Why You Don’t Want to Be Your Own Contractor
By Richard Blumenberg – RLB Architecture | Chamber Board Member
Many homeowners think that by being their own contractor they will save money—this is a big mistake. That is because the work needs to be done in a specific in order for it to turn out right. Scheduling subcontractors yourself may result in costly mistakes and work needing to be redone. Building inspections must be done at specific stages of the work in order for the subsequent work to proceed. If work is covered up prior to the inspection, it may have to be ripped out to expose the work needing to be inspected.
Contractors typically schedule workers and subcontractors and are responsible for seeing that the work is done in a timely manner and the workmanship is satisfactory. Unless the homeowner has extensive knowledge about how to construct what is being done, the homeowner will be at the mercy of the building trades.
There is no savings of material and labor when a homeowner acts as an owner-builder. The cost of materials is discounted based on volume. A contractor who does several projects gets his materials discounted based on how much is ordered for the year. A homeowner only orders once and as a result pays the highest price.
On a previous remodel I as the architect, thought I would save on the construction cost by not paying the contractor’s fee and handling the project myself. Deal with subcontractors was very time consuming, and I found that I was spending so much time on the project that my business suffered.
Since I knew which windows I wanted to use, I got a price directly from the window manufacturer. Later I heard about a window broker and requested a bid for the same window order. The broker’s price was thousands less. When asked why this was so, I was told the pricing was based on the volume that the window broker ordered, and I was a one-time shot. When it was time to do the drywall, I got a bid from a drywall company. Then I asked my stucco contractor to provide a bid for the drywall. His bid was substantially lower so I told him to proceed. When the drywall was being done, I noticed that is was the same company I had originally bid. When asked why he gave me such a high price initially, he said that he doesn’t like working directly with homeowners.
I had gotten a Workers Compensation policy from State Fund in order to protect myself in case a worker got injured during construction. No premiums were required for subcontractor work if they had their own insurance. The framer showed me the cover page of his workers compensation policy as proof he had insurance. When the framing was done, I turned in the paperwork to State Fund. It turned out at the framer cancelled the policy immediately the next day. As a result, I had to pay for the workers comp for the framing which was over a thousand dollars. The lesson learned is to get the certificate directly from the insurance company with a request a notice of cancellation.
It is extremely important to get a permit for any construction work. Many contractors say that this is not necessary but it is an important to get the work inspected to insure that it complies with code. Doing work without a permit will need to be disclosed to a buyer if a property is sold. Although a homeowner may obtain a permit by being an Owner-Builder, a contractor must prove that he/she has Workers Compensation insurance and contractor’s license before a building permit may be obtained. This is extremely important should a worker get injured on the job. If a homeowner decides to be an Owner-Builder, then getting a Workers Compensation policy is necessary to cover the construction workers should an accident occur.