Case Study - hiring a builder
How do you hire a builder who is going to produce a quality result, within your time scales and within your budget? How do you find a builder who will do a good job and not over charge you?
I had never hired a builder before, so this was all new to me. Over the years I had seen many of my friends doing extensions to their homes with rather mixed outcomes. In most cases the relationship with their builder worked out fine but for some of my friends the project ended up being a bit of a nightmare. Their expectations had not been met and the relationship with their builder completely broke down. Worse still, the overall costs ended up being much higher than anticipated.
I think the first things to consider when you are looking for a builder is look at your own situation.
Will you be living in the house while the building work will be taking place?
- Do you have a job that keeps you away from home, which means that you will not have the opportunity to monitor the build progress during the day?
- Are you a practical person who is good with your hands? In other words can you build and repair things yourself?
- Are you any good at managing projects? Could you get involved in the details of ordering stuff and progressing deliveries etc?
- Are you good at managing people to get the best outcome?
In my case I worked from home and would be intending to be present during the whole project. I am a fairly practical person and woodwork has always been a hobby of mine. I am not a Surveyor or an Architect or a builder, but over the years, through my company Local Surveyors Direct, I have had a lot of contact with property professionals and I have picked up snippets of knowledge here and there. I think I am good at running projects. I think I am reasonably good at working with people but I have had no experience of working with builders and I would suspect that I would not be good at it.
The next question I had to ask myself was; did I want a fixed price quote or did I want an estimate?
If you go for a fixed price, this has the advantage that you will hopefully keep within your budget (assuming you do not make any changes half way through). The builder will also be incentivised to get everyone involved working to their full capacity. But there is a downside. The builder will be highly incentivised to take every shortcut that he can get away with, as he will be wanting to keep his costs as low as possible, so he can maximise his profit. There is also an element of financial risk. The builder will require you to pay significant sums of money in advance, as he will be ordering and paying for all the materials. If you fall out with the builder, or if he were to go bankrupt during the project, you could lose a lot of money.
If you go for an estimate, you will retain complete flexibility to make changes as you progress through the project and you will be able to ensure that everything is done to meet your quality requirements. But there is of course a downside. You will be totally reliant on your builder working efficiently to keep the costs down where ever possible. If your builder gets a bit slack and does everything very slowly, this will cost you a lot of money.
Another question is; did I want to be involved in ordering materials and paying invoices?
Being directly involved in the project management can be quite involved but if you are fairly organised it can give you much more control and it can save you a bit of money. If you are paying all the bills on a weekly basis, it means that you are not making any advance payments to the builder and you are minimising some of your risk.
I think most people go for a fixed price when embarking on an extension project, their objective being to keep costs under control and stay within their budgets. However, in my case I decided to go for an estimate, rather than a fixed price. In addition I decided that I would prefer to be involved in ordering some of the building materials but not all. I decided that I would definitely want to pay all the invoices directly.
I now needed to find a builder who I felt would be best for me. My first option was to go with my friend Giles. He had given me some good help when I was applying for planning permission and he had also done some excellent work producing a detailed spreadsheet to indicate likely project costs. I had of course paid him for this and I was very happy with the work that he had done for me. In addition we were both members of the local Rotary Club and we had both worked on various fund raising projects including the Clarendon Marathon (Salisbury to Winchester, first Sunday in October each year, www.clarendon-marathon.co.uk). I had always found Giles to be organised and reliable.
However, I felt it would not be prudent to give the job straight to Giles until I had investigated the other possibilities. So I asked other friends for possible builders that they could recommend and I went on various websites to get contact details for even more builders. While I was doing this, I also received a few letters from builders who had seen my planning permission listed on the council website.
Altogether, I had about 10 builders who came to see me. They were all fairly reasonable in their presentation but they were all very different. Some felt that we would need to erect a lot of scaffolding and make a temporary tin roof over the whole house, then take the roof off and build the loft conversion. Other builders were quite certain that this would not be necessary. The other problem was the new beams that would need to be bought to go on at roof level. The span was 8m, so using wooden beams would not be possible. Most of the builders felt that we would have to have some special iron girders manufactured and these would need to be 35cm high and we would also need the hire of a large crane to put them in place. However, one builder suggested using a new telescopic aluminium beam that would only be about 20cm high and would not require a crane (www.telebeam.co.uk), thus producing a considerable saving. Subsequently I was very pleased that I had met all these builders and I learnt a lot by talking to them.
Although they all these builders said they were interested in doing the project, about half of them never actually sent me a quote. So my 10 builders were quickly whittled down to 5. One of these quoted a price that was so ludicrously high that I can only assume that he was hoping to subcontract the whole job and just retain a large profit for himself. He was quickly off my list and I was down to 4. I was very happy with all these builders and their price estimates were all in a similar ballpark.
My wife and I discussed it and we decided to go with our friend Giles (www.teamworkproject.co.uk). We were comfortable that he would be reliable and his price estimate was similar to his competitors. His preferred way to work was by using a detailed estimate and invoicing weekly, with me paying all the men and all the suppliers directly myself. By working on an estimate, and with me being present every day, it meant that we would be well placed to get the best quality that we wanted. Also anything that we did ourselves would be a small saving for us.
So what was the outcome?
Over all we were incredibly lucky. Giles and his team all started within a few weeks. We took great efforts to learn all their names as soon as we met them and they all turned out to be great people. The summer in 2014 was very dry and this probably also helped us a lot. Each week Giles and I had a meeting where he presented all the invoices for payment and I duly paid them on the same day without delay. We did end up making a few changes and a few additions, as we progressed through the project but despite these changes, the job was finished on time and within the estimated budget. The quality was just what we wanted and we were very pleased. Giles was even more pleased as half a dozen of our friends subsequently place orders with him for their own building projects.
Article written by JJ Heath-Caldwell