Any time you need to hire a contractor for a home improvement project, you should get at least three estimates before choosing who to trust with such a significant responsibility. This is especially true when buying or selling a home. The wrong decision can drastically affect your property value and/or ruin a home you just invested so much money, time and effort in purchasing.
During a real estate transaction, you need a team of real estate lawyers, a real estate agent and, if applicable, a contractor you can trust to protect your interests. When looking for a contractor, as with the other members of your team, this means doing your research, reading reviews and checking references. Getting written estimates from a contractor helps you better assess potential candidates and make an informed decision.
Many contractors you come across may not provide written estimates. This is a major red flag for significant renovations that require a professional who will honour a service contract and takes their business seriously.
With an estimate for a reno project, homeowners often focus on the prices for materials, labour and the overall cost, but how a contractor prepares an estimate can help you decide if they are trustworthy and reliable.
These are some of the things you should look for when you get an estimate for a home renovation project.
Contact Information and Business Details
A contractor’s invoice should provide at least a few options that allow you to reach someone at the company. Comparing the business name and/or number, phone number(s), email address, business address, etc., with what’s on their website and what’s listed on Google can help ease your doubts if they are consistent.
You can also use that business name or number to look them up on the Ontario business registry to learn more about them, including how long ago the business was registered and their principal place of business.
If they are licensed and provide a license number on the estimate, you may also be able to look them up on the licensing body’s website for more information.
The Work to be Completed
When a contractor comes to inspect your property, they should be asking you questions about your goals and expectations as they assess the project area. Having this conversation can get you and the contractor on the same page and help them more accurately predict how much work is involved.
When you’ve agreed on the work to be completed, ideally, the estimate will detail each step in the process, the predicted timelines for each, and the overall time to complete the project.
Terms and Conditions of the Estimate
This section should clearly state that what you’ve been provided is only an estimate and not a contract for services. There may also be a disclaimer regarding material and labor costs and possibly an expiry date on the prices in your estimate. Prices for construction materials can fluctuate, and this type of clause protects the contractor in case material costs change between when you get the estimate and when you sign a contract for services.
Look for this section to know your timeline. The law in Ontario is that a contractor cannot charge you more than 10% above the total estimate cost if it is included in the home reno contract unless you agree to a new price or work order, so have the contractor include the estimate as part of the contract for services.
Potential Risks and Contingencies
A contractor’s estimate may also include stipulations and policies for dealing with delays and unforeseen circumstances.
Possible delays and increased costs can be attributed to weather, injuries or property damage that isn’t visible until the work begins. For example, mould inside your walls that is only discovered during drywall demolition that requires professional cleaning or a leak needs to be repaired.
It’s vital to know how a contractor will deal with these situations and potential increased costs to help you in your selection process before your final decision.
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