Avoiding home improvement disasters - includes related articles

Black Enterprise, Nov, 1992 by Margaret Sabo Wills

Alva and Greg Campbell had their first doubts about their contractor when they noticed that the flooring in the new downstairs hallway looked familiar. Upstairs, to their shock, they found a large hole in the center of the bedroom's original red-oak-and-mahogany parquet. Later, eight long months into a $100,000 contract to renovate their 70-year-old Dallas house, the contractor simply disappeared. When the Campbells found him six frantic weeks later, they agreed not to sue for breach of contract. But a year later, they ended up in court anyway, over that foundation's crumbling, incorrectly mixed concrete. Then they found out that the contra ctor wasn't insured.

A classic renovation horror story, complete with cost overruns, nonexistent schedules, shoddy work and mental anguish. In 1991, the Better Business Bureau heard more than 30,000 similar tales on repairs and renovations. How can you make sure that your home improvement epic ends more happily?

"Homeowners hire a contractor because building is not their field of expertise," points out David Creech, president of Creative Design Contractors Inc., in Charles County, Md. "And there are unscrupulous contractors who take advantage of people's ignorance. Unless homeowners take an active part in the project and research the contractor's ability and reputation, they leave themselves wide open to being ripped off."

Homeowners often fear sharp operators, but it can be just as risky to hook up with a poor business person. "A lot of folks don't realize what it takes to make money in this business," observes Ann Marie Moriarty, senior editor with the trade journal Remodeling. "Some [contractors] might be doing good work. But if their prices are too low, eventually they run out of money. It's always the last one or two clients who get burned."

During the 1980s, spending for remodeling products and services more than doubled, reaching $106 billion in 1990. Between 1990 and 1991, however, according to the Remodelors Council division of the National Association of Home Builders (NAHB), home improvement expenditures dipped 8%, largely because of a drop in high-ticket renovations and additions.

Has this created a buyer's market in home remodeling? Probably yes, if that buyer is careful. In slow markets, warns Moriarty, more contractors may underbid to keep afloat, and be forced to cut corners or walk away mid-project. "Bigger, better-run companies will probably cut their margins just a tad to be competitive," she continues. "Therefore you can probably afford a better-quality remodeler."

Laying The Groundwork

Despite its sour turn, the Campbells' project was carefully thought out. The contractor came highly recommended for his work on several of the historic neighborhood's old houses. "He's a wonderful craftsman," Alva concedes generously, "but he'd never overseen a massive overhaul like this. Managing the money and the people were just beyond him."

Greg and Alva spent the spring of 1988 walking through the house with various remodelors. "Our first concerns were very basic--foundations, plumbing, wiring," Alva says. "We'd say, 'Anything is possible for unlimited money, but can we do this for what we have to spend?'" As the budget took shape, the Campbells decided to hold off on landscaping and some decorative frills. And, because reworking existing space is usually cheaper than building on, they moved several walls to make the floor plan more usable.

"Most people just don't understand construction costs," says East Coast contractor Creech. In early planning sessions, he and his clients discuss choices for the visible components--windows, door trims, light fixtures and appliances. But equally important are the unseen framing, plumbing, wiring and insulation. "Homeowners tend to overspend on their initial wish lists," Creech says. "When the reality hits them, we have to start finding ways to cut back."

When costs are a concern, advises Remodeling's Moriarty, try to leave plumbing, heating or electrical systems in place if they're sound and up-to-date. "In appliances and cabinets," she continues, "you can usually get a good value with a better-quality brand at the bottom of their line." She also suggests tapping your contractor's experience in choosing products. A builder might know that those jazzy faucets you crave are impossible to repair. Bear in mind, however, that remodelors lean toward what's standard, tested and available. Don't be talked out of what you really want.

"One thing we discovered was that renovation is an art, not a science," Alva recalls. "If you go in expecting a single solution, you're fooling yourself. So you collect information, and finally you, the novice, has to make a judgment call." But, she jokes, "you learn a lot very fast. I was suddenly talking pier-and-beam foundations like an expert."

The Campbells learned too late that their contractor needed closer supervision. Regular business meetings and detailed progress reports might have kept problems from snowballing, Alva says. "The contract should spell out and budget for how work is managed day-today."