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Priced for Problems
Why Remodeling Horror Stories Often Start with
a Great Price
  Unlike when purchasing mass-produced, brand-name
products, which are identical to each other regardless of the
price, comparing
the prices of one remodeling firm to another is rarely the best
indicator of the value you will receive. In fact, one industry
observer has said many times that “remodeling horror stories
often start with a great price.” Why is that?
There are many factors that affect the remodeler’s costs
when pricing a project. In order to present you with a lower
price, they can estimate based on using lower quality lumber,
cabinets, flooring, windows, doors, roofing and other materials.
You won’t know this until a few years after the project
is finished and things start to warp, fade, crack, jam, leak
or squeak. They can skimp on things like the thickness of the
sub flooring, the actual amount of insulation they use, and the
quality of the insulation they use. They can use ‘allowances’ for
products you will have to pick out after you sign the contract
that are based on the lowest-cost products instead of products
in-line with the quality of your home or the quality you are
expecting the remodeler to provide. When you select the type
of product you expected to be covered, you could find out that
the allowance only covers a small part of what you select, requiring
you to pay extra for what you thought was already included in
the price.
Skilled carpenters, project managers, and specialty tradesmen
command higher salaries than those with lower skills. A well-trained
and coordinated staff works better and runs your jobs smoother
than a crew that uses low-cost labor that is picked up at a street
corner on the way to a project. Effective project management
and a project that is run smoothly, on budget, and on time require
more time, skill, planning, effort and cost than low-priced remodelers
allow for.
Nothing about any of the above practices
is illegal, but they can affect the price of any given project
by 50%, 100%, 200%,
or sometimes more. Of course, without quality materials, skilled
craftsmen, and professional project management, a remodeling
project can become a nightmare. So can a project where the remodeler
so under-priced the project they can’t finish it.
However, some remodelers go even further
to cut costs. They don’t carry workers comp on their workers, meaning you
can be responsible for medical and other expenses should their
workers be injured on the job. They may not carry general liability
insurance, or they may ’save you money’ by not pulling
a permit or getting inspections. If they take these illegal short
cuts, they may take other shortcuts when constructing your project.
Some remodelers may suggest that you take out the permit in your
name so that you will save money. True, you might save some money,
but the person whose name is on the permit is legally and financially
responsible for the project and it meeting code. Your remodeler
knows this, but likely won’t tell you. Do you want that
responsibility? Or do you want your remodeler to be responsible
for their work?
Looking at a construction contract, the low-priced contract
could look very similar to a reasonably and honestly priced contract.
On the surface, they both describe the same project, but as you
now know, the devil can be in the details.
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