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How to avoid home renovation hell

CHRISTCHURCH, NEW ZEALAND - FEBRUARY 28: Chris Williams dismantles a collapsed wall at a property in the suburb of Fendalton on February 28, 2011 in Christchurch, New Zealand. The death toll has risen to 147 and the hope for finding survivors is fading as rescuers search through debris for over 200 still missing following a 6.3 magnitude earthquake that struck Christchurch on Tuesday. The quake, which was an aftershock of a 7.1 magnitude quake that struck the South Island city on September 4, 2010, has seen damage and fatalities far exceeding those of the original. (Photo by Cameron Spencer/Getty Images)

Be it a small update or a professional overhaul, spring is often referred to as the season for home renovations. From kitchen cleanouts to luxurious living room makeovers, many people want to improve their home before summer kicks into full gear.

The demand for housing in Canada’s urban centres has fueled what the Consumer Council of Canada refers to as a “renovation boom” and a nearly $37 billion home improvement market. Supported in part by government incentives and access to easy credit, thousands of Canadians have already committed to renovating their home this year – but at what cost?

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Renovation services and contractor quality have long been leading sources of consumer complaints in Canada. Whether it’s an exclusive news report or an angry blog post, the home renovations industry has, justly or unjustly, been branded as unreliable, expensive, and downright dishonest.

“Any renovation project, big or small, will present unique problems,” explains Bruce Misner, a 20-year contracting veteran of the Winnipeg home improvement industry and president of NrGreen Electrical Contractors. “If you’re not careful, you could end up hiring the wrong person for the wrong job, a mistake that will have costly repercussions.”

While it’s possible to obtain certification for common trades needed in home renovations – think electricians, plumbers, carpenters and drywallers – there is no formal training or accreditation program in place for individuals who claim to offer all-inclusive home renovation services (currently, only one community college in Ontario - Canada’s largest provincial market for home improvements - offers a program that claims to provide the overall training necessary to become a home renovator).

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As such, it’s up to consumers to make careful choices when it comes to finding an affordable and qualified contractor. “There are plenty of honest and reputable home improvement professionals out there,” insists Misner. “The trick is knowing what questions to ask when recruiting members to your home renovation team.”

In order to cut costs and ensure quality, Misner recommends abiding by the following five home renovation rules…

5 little known home renovation rules

1) Get it in writing

“Never, ever, under any circumstance, agree to a home renovation project with just a handshake,” advises Misner. A home renovation contract is designed to protect you, the homeowner, against an unscrupulous contractor or home renovator. This contract should be easy to read and clearly outline the scope of work that is to be done for the quoted price to avoid misunderstanding, conflict and over-billing. Your contract should also clearly outline the payment plan; contractors and home renovators will work more quickly and efficiently if it means they will get paid sooner.

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Also ensure that your contract makes note of any permit requirements. “It’s typically the homeowner’s responsibility to obtain the proper permits. As such, make sure your home reno contract clearly states if the permits are to be supplied by the contractor instead and that all work will be completed to building code by certified and licensed contractors and sub-contractors.”

2) Pay based on milestones, not set time periods

When drawing up a contract with your home renovator, be sure to review the payment schedule closely. “Be very cautious of contractors asking for too much money upfront,” says Misner. “If your contractor asks for a down payment, a reasonable amount is 10 or 15%, not 50%.”
The rest of the contract should be paid out based on pre-determined milestones, also known as progress billing. For example, if you’re installing a bathroom, you may want to break your milestones into the following: 25% when the electrical services and new plumbing are roughed in; 25% when the bath, wall linings, waterproofing and tiling are complete; 25% following the final fit of plumbing and electrical fixtures; and the remainder once the finishing touches (painting and accessories) have been completed.

3) Ask for proof

It’s your legal right to request that your home renovator show you valid licenses before he begins working. This is true for any member of his team, as well. “If you hire a contractor, ensure that the sub-trade workers are licensed, and that your contractor isn’t doing work that they are not properly licensed to do, such as plumbing or electrical, or heating/cooling.”

What’s more, feel free to ask your home renovator to provide you with a list of references (both their names and contact information). Touch base with these people before you sign any contractual agreement with your provider. You’ll want to make sure your chosen home improvement expert is as good as he or she claims to be.

4) Be wary of expensive extras

Extras are a key area where your contractor makes money. When contractors quote on your project, they are usually competing against other contractors to get the job; therefore, the initial quoted price is usually competitive for labour and material. As the project moves forward and there are changes required or unanticipated issues arise, your contractor will take care of the extras but more often than not at a premium rate. Before venturing into large projects or renovations, do your homework, understand the scope of work to be done, and plan properly to avoid costly extras.

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“Save yourself some serious cash by having all of your fixtures, appliances, etc. selected prior to the design process,” recommends Misner. “Then simply provide your contractor with prints, makes, and model numbers. A common mistake is that people choose items after the project is underway or change their minds partway through, a decision that will result in costly delays and additional charges.”

5) Don’t settle for deficiencies

Not satisfied with your finished home renovation project? Do not pay in full until all the deficiencies have been completed; a reasonable holdback amount is 10%, according to Misner. “Any home renovator who takes pride in his work will do whatever it takes to meet and exceed your standards of excellence,” he says.

Keep it professional

In the end, you want to protect yourself and your home by planning ahead, hiring professionals and documenting your project with a formal agreement. These steps will ensure that your renovation is executed efficiently and professionally, without hidden costs and frustrating delays. is a free personal finance and education site for women.

Nothing contained herein is intended to provide personalized financial, legal or tax advice. Before implementing any financial strategy, you should obtain information and advice from your financial, legal and/or tax advisers who are fully aware of your individual circumstances.

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