10 Things Your Renovator
Won't Tell You

This article originally appeared in the May 2002 issue of MoneySense magazine, Copyright 2002 by Rogers Media, and may not be reprinted in part or in whole without express written permission.

Too many home upgrades end with inflated bills and angry words. Here's how to get the house of your dreams without enduring a nightmare.

by Sandra E. Martin

Photography By Natalie Kaufmann

HOME INSPECTORS like Graham Ashdown can be invaluable allies in planning and carrying out a renovation. Get an inspector to assess your home before work starts, to save yourself money - and potential trouble - once the reno is underway.

AN ART DIRECTOR BY PROFESSION, Penny Argue could see the possibilities hidden beneath the tired skin of the 80-year-old house that she and her fiancé, Rob Northcott, had just purchased. The beautiful wood trim and stained-glass windows-those details would stay. But the old cupboards and the constricting wall between the kitchen and dining room would have to go.

In their place, Argue and Northcott envisioned a bright, open space for cooking and entertaining, with a granite-topped island where guests could pull up their stools and enjoy a glass of wine while their hosts put the finishing touches on the evening's meal.

Renovations on the Toronto home began in February 2001, and for a while everything seemed to be going well. Argue even scored a major discount on the granite for the countertops by asking an associate at work to use his connections at a stone-supply company.

That slashed the cost to $2,000 from $3,000. Excited at the prospect of a gleaming new kitchen, the couple trashed their old setup, figuring the new countertops, cupboards and fixtures would all be installed together within a matter of days.

Too bad they didn't realize there would be a month-long wait for delivery and installation of the countertops. And, of course, you can't install a kitchen sink without the counter in place. So Argue and Northcott were forced to struggle on, without a kitchen, for six weeks.
"We did our dishes in the bathtub for a month," she says. And the thousand bucks she saved on the granite countertops? "I'll have to put that money back into glazing my tub upstairs, after I scratched it all to hell from doing my pots in there!"

Anyone who's survived a home renovation can relate to Argue's tale of woe. Maybe the problem is a delay in getting materials; maybe the pain is unexpected cost overruns.

Or maybe the torture comes in more subtle, psychological forms, as a result of messy handymen and the unexpected stress of living amid sawdust and bare drywall for months at a time. Whatever the case, it's rare to find a homeowner who can look back on a renovation project without an involuntary shudder.

Bypassing problems depends on finding a good renovator, but therein lies the challenge. Sure, many renovators are skilled and reputable tradespeople. But those who bend the truth are as common as shingles on a roof, and seriously dissatisfied clients are only a little less so.
Last year in Ontario alone, 1,599 homeowners called and wrote the Ministry of Consumer and Business Services to seek advice about renovations or complain about shoddy work they received from professional home contractors. According to the ministry, renovation work is one of the top 10 consumer beefs.

What you need is an insider's guide to the treacherous world of home renovation. Stick with us as we reveal the top 10 things your renovator won't tell you.

"I love it when you're disorganized"
"A home inspector can be your best friend"
"I may have absolutely no professional qualifications"
"I may have pulled your quote out of thin air"
"The strong, silent type could be trouble"
"You can save a bundle by pitching in"
"If I can start tomorrow, you'll hate my work"
"Every job needs a formal contract"
"Permits are not optional"
"You'll forget I was ever here"

"I Love It When You're Disorganized"

Renovators feast on clients who don't know what they want. "I want to fix up my kitchen" is not a renovation plan; it's a recipe for disaster.

A reputable contractor will sit down with you before a deal is made to discuss the exact specifications of the job, but many others will give you an estimate based on what they think you want done or, worse, based on what they think you want to pay. Either way, the work is almost guaranteed to cost more than the estimate.

The more specific and detailed you can be about your desires, the easier it is to compare quotes. If the cost seems overwhelming, remember that you don't have to do everything at once.

"Lay out what you want to do, then prioritize," advises Paul Gravelle of the Canadian Home Builders' Association (CHBA). "If you have a very thick wallet, you may be able to do it all at once."

If not, a detailed plan will help you schedule the work in small, affordable stages. Lots of help is available, some of it for free. For instance, the CHBA Web site (www.chba.ca) has a Home Renovation Resource Centre that's full of good advice and printable worksheets.

In addition, some suppliers offer no-charge design consultations if you buy your materials from them. Argue was able to work with a Home Depot kitchen designer for free because she ordered her new kitchen cabinets from the reno chain.

If you know what you want but you're not sure about technical details, one relatively cheap source of impartial advice is an independent home inspector (we'll talk about these handy experts in more detail later).

On the other hand, if you're having a hard time visualizing what you want a new addition to look like, or if you're running into trouble agreeing with your spouse on how the new kitchen should be laid out, consider hiring a registered interior designer.

These professionals are trained to marry your desires with your budget and they can be invaluable at helping you articulate what you want. Candice Olson, a Toronto interior designer with 11 years' experience, stresses the importance of functionality in her clients' plans.

"A lot of times, contractors will come in and it's all about the space and how it will look, no matter who's living there," she says. "But if you're five-foot-two, you can't have 36-inch kitchen counters."
While designers' fees vary widely, you should expect to pay 7% to 10% of your overall construction costs to the designer; the larger the job, the smaller the percentage.

Very large or complex jobs may require the services of an architect, whose fees can run several times that of an interior designer, but you probably won't need to take that expensive step. According to Darrel Smith of the Canada Mortgage and Housing Corp., a qualified designer can handle all the structural and esthetic planning for even an extensive addition.

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"A Home Inspector Can Be Your Best Friend"

Like many folks, you might have hired a home inspector before you purchased your house to ensure there were no cracks in the foundation or bugs behind the walls. But some inspectors are also available for pre-renovation consultations. These experts can be invaluable allies in planning and carrying out a renovation. Think of them as divining rods for potential screw-ups.

"If You're Price Driven, you may go for the cheapest quote," says Graham Ashdown, below. But the cheapest renovator may not be the best one for your job. A home inspector can help you determine who is.

By assessing your home's condition before you start planning, an inspector can advise you how to make that wonderful new addition structurally possible. Later, when you're shopping for a contractor, your home inspector can help make sense of different estimates.

"Let's say you get three quotes to replace a furnace, from $1,700 to $3,500," says Graham Ashdown of Grassroots, The Inspection Specialists, in St. Catharines, Ont. "If you're price-driven, you may go for the $1,700 quote. But what you may not know is the lifespan of the unit, its ability to heat the space or how much energy it's going to use."

A home inspector will take the guesswork out of your decision by assessing each quote and translating the jargon into plain English.

If you wish, an inspector can visit your job site at key points throughout the renovation, to ensure the work is being done properly. And, when the renovation is done, the inspector can eyeball the job for potential problems before you hand over the final cheque to the renovator.

It's a lot easier to fix mistakes at this point than to take your renovator to court when problems appear months later. But if things do turn nasty and you wind up pleading your case before a judge, a home inspector can provide photographs and professional documentation to back up your claim. Fees for a simple inspection usually don't exceed $500.

Finding a reputable home inspector requires a bit of detective work. Don't just pick the first name out of the Yellow Pages; you could get stuck with a part-time handyman who's had no formal inspection training.

To help consumers identify qualified home inspectors, a national certification plan is being developed and should be in place by early 2004. Until then, however, your best bet is to choose someone with membership in both your provincial home inspection association and the Canadian Association of Home Inspectors (CAHI), the national umbrella group for this profession. Log on to www.cahi.ca and click on Find an Inspector.

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"I May Have Absolutely No Professional Qaulifications"

"Anybody can just grab a Skil saw and a hammer and call themselves a builder," says Brent Cliff, president of the Fredericton Home Builders Association and owner of Brent Cliff Builders in New Brunswick. But between the jam-packed Contractors section of your local Yellow Pages and the stack of flyers in your mail every week, how can you tell who's qualified and who's not? These tips may help.

Judge them by the company they keep. In most parts of Canada home renovators don't need a licence to ply their trade, so it's up to you to spot frauds. At a bare minimum, you should insist that a contractor produce a GST registration number or business number. (Fly-by-nighters will try to get by with a P.O. box address or nothing at all.)

You should also ask for proof of insurance. This protects you if an employee of the contractor is injured on your job or if the contractor puts a ladder through your front window.
Inquire, too, about whether a contractor is a member of local, provincial and/or national home builders' associations. Many of these groups require that members sign a code of ethics, and will field client complaints and questions.

The rule of three. Everyone knows you're supposed to get at least three references from at least three renovators before deciding which one to hire, but most of us fall down on the follow-up.
Once you have those references in hand, you've got to get on the phone and grill each one of them. Why did they hire that particular renovator? Were they satisfied with the work? To help you with your interrogations, the CHBA Web site has a printable reference check worksheet you can use with every call, which includes a thorough list of questions with space for the customers' responses (log on to www.chba.ca and look for the online renovation toolkit).

It's also a good idea to visit one or more of the renovator's completed projects (the more similar to yours, the better) to see the work for yourself.

Longevity preferred, but not essential. If a renovator has been in business for years, that's a good sign. But don't dismiss newcomers out of hand.

"You can't blank out a guy because he's just starting out," says Cliff. "Referrals are the most important yardstick."

Choose a contractor whose previous work is very similar to the work you want done. If that means going with a younger firm, you may save money as well.

"Some people who are very new in the business are going to cut their prices down to build up their client base," says Cliff. Translation: top-notch work for reasonable prices.

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"I May Have Pulled Your Quote Out Of Thin Air"

The best contractor isn't necessarily the one with the cheapest estimate. A low quote could be a sign of inexperience - the contractor may have underestimated the scope of the job or the amount of time it will take to complete.

A low quote could also be the sign of a failing renovator who will bid low to get your gig, then hike up the final price with unexpected additions (sometimes called change orders) as the job progresses.
One way to avoid these problems is to ask a home inspector to vet the estimates. Get him to explain which bid offers the best value and why.

Or, if you've been working with an interior designer, you can give each bidder a copy of the detailed renovation plan, outlining the exact materials to be used and the amount of labor involved. This forces each of the candidates to bid on the same job and allows you to easily compare quotes.

Some designers, such as Candice Olson, work with a stable of builders they've grown to trust over the years, and will refer you to the one who's best suited to your job. For example, if you have children and pets, and need to live in your home while the renovation is under way, she'll choose a builder with discreet staff and impeccable end-of-day cleanup habits.

"When I started out [as a designer 11 years ago], I was in the position of your average homeowner. I worked with builders on recommendation and just had horrible experiences," Olson says.
The good news for her clients is they will benefit from her early mistakes. Now that she knows who the "bad guys" are, she can steer her clients away from them.

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"The Strong, Silent Type Could Be Trouble"

It's important to choose a renovator with whom you have an easy rapport. If a problem crops up halfway through your renovation (and it probably will), you've got to be able to negotiate the solution.
And that's easier done with a willing communicator than with a brick wall. Finding a good fit is especially important if your renovation is going to stretch through weeks or even months.
In those cases, you are going to be living cheek-by-jowl with your renovation crew, and it's a lot easier to negotiate the boundaries - are they allowed to raid your fridge; where can they leave their tools - if you're on comfortable speaking terms.

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"You Can Save A Bundle By Pitching In"

If you're willing to get your hands dirty, you're well on your way to saving big reno bucks. The more you're willing to pitch in, the less you have to pay a contractor for.

Think you're all thumbs? Doing it yourself doesn't have to be an all-or-nothing proposition. When you're working out the details of your renovation contract, figure out the parts of the job that you can handle and simply have the contractor come in as needed to do the rest.

Even with zero construction experience, you can rip out old carpet or swing a sledgehammer to tear down a wall. And if you're interested in doing more, there are plenty of resources to help you pick up the skills that you need.

Just ask Rennie Soogrim. He had never built anything until four years ago, when he and his wife became the proud owners of a late 1960s-vintage, three-bedroom house in Brampton, Ont. The cedar deck in the backyard was pretty, but in desperate need of patching.

Soogrim suspected that any work he put into the decaying structure would probably have to be repeated the next summer and the next, so rather than repair the existing deck, he decided to replace it. By himself. The key was investing a few hours in education before making the first cut.
"I went to a couple of seminars at Home Depot," he says. "Those things are extraordinarily helpful, and they're free."

If, like Soogrim, you're the hands-on type, renovation centres such as Home Depot and Revy/Rona offer no-charge, step-by-step lessons on common renovation jobs, ranging from garden fencing and decks to wall framing and fancy paint finishes - in-store at the Home Depot (check the white board in your local store for upcoming seminars) and on the Internet from Revy/Rona (www.rona.ca).

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"If I Can Start Tomorrow, You'll Hate My Work"

Well-regarded renovators have no shortage of clients, which means they have jobs lined up for the next several months. Interior designer Candice Olson tells her clients to prepare for a long wait.

"I try to have clients get their permit in hand one year, shop for their builder over the winter and plan for their renovation to begin in the spring," she says. "If you're really gung-ho, you can find someone to build it immediately - everybody's got a brother who's a builder or a contractor. But that's when you get into trouble."

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"Every Job Needs A Formal Contract"

"Let's shake on it" might be an appropriate way to seal a deal between friends, but it's the last thing you want to say to a professional home renovator. Every job, no matter how small, has got to be laid out in writing, in a legally binding contact. Make sure yours includes these essential elements.

Full disclosure. The contract should detail the scope of the renovation (including which parts of the job, if any, you intend to complete yourself), what materials are to be used, as well as warranty coverage (one year is standard).

Start and finish dates. How many times have you heard friends and neighbors complain that the contractor didn't show up when he said he would? Putting an official start date on paper nips that problem in the bud.

And while writing an estimated completion date into your contract can't guarantee you'll get your house back by then - renos almost always take longer than you or the contractor expect - at least it gives you a yardstick for measuring your contractor's progress.

"If you're going in for a bathroom changeover, you shouldn't be off by more than a day," advises Fredericton contractor Brent Cliff. On a larger renovation, however, unexpected problems or last-minute additions could tack a week or two onto your timeline. (Tip: any work not specified in the original contract shouldn't start until you and your contractor have signed an addendum or change order outlining the details.)

To protect yourself from a months-long delay, you could have a penalty clause written into the contract, stating that your contractor must rebate or discount your bill by a certain amount if the job isn't completed by a specified date.

But not every contractor will agree to a penalty clause, or they'll agree only if there's a counterbalancing bonus clause requiring you to pay the contractor extra if the job gets done early.

Payment schedule. Insisting on staggered payments can give you the upper hand in middle-of-the-job disputes: if you don't like the way things are going, you can insist on withholding payment until they're back on track. (See the section on Holdbacks, coming up next.)

Never pay in cash, no matter how good a deal you're promised. With no proof of payment, you'll be up the creek if something goes wrong or you're dissatisfied with the finished product. Always pay by cheque and insist on a signed receipt.

Your deposit payment, if any, should be minimal, especially if the job is small. For example, when Cliff does a one- or two-day job, such as a bathroom renovation, he asks for a goodwill deposit of 10% when the contract is drawn up - "to verify that when I get there, the job will still be there" - then asks for the balance upon completion.

For longer-term jobs, Cliff and his clients usually agree upon equal monthly instalments, with the cost of additional work not laid out in the original contract to be paid within 30 days of completion.

Holdbacks. If your renovator tries to skip out on payment for supplies or subcontractors' services, the firms who are owed money may place a lien against your property until they receive payment. Ensure that you don't get stuck with your renovator's debt by holding back a portion of each payment until after the entire job is completed.

How much you should hold back, and for how long, depends on where you live. In British Columbia, for instance, a holdback of 10% of the full payment amount for 55 days is standard; in Ontario, it's 10% and 45 days. Check with your provincial government for the details about holdbacks where you live.

For a full rundown of everything your renovation agreement should include, along with a sample contract and tips for interviewing candidates for your job, log on to the Canada Mortgage and Housing Corporation Web site (www.cmhc.ca) or the Canadian Home Builders' Association Web site (www.chba.ca/renovatingyourhome/resourcecentre/toolkit/_homerenotoolkit.html).

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"Permits Are Not Optional"

If your contractor has promised to take care of your building permits, make sure he actually has them in hand before work begins. Because building renovation requirements vary from city to city, you should check with your municipality if you have any questions, while you're still in the planning stages.
If a city building inspector discovers that a permit was neglected, you could be forced to tear down your entire renovation, even after the work is done. Just as grim, the lack of a permit could void your homeowner's insurance.

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"You'll Forget I Was Ever Here"

Anytime you're going through a rough patch, remember why you agreed to do all this renovation nonsense in the first place.
Eventually, the banging, the dust and the refrigerator-raiding will come to an end. Your contractor will go home and you will get your privacy back.

And, if you heed the advice in these pages, you'll still have enough money left over to toast your new and improved digs with a gourmet-style home-cooked meal and an above-average bottle of wine.

Visit Money Sense today at: www.moneysense.ca

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