To Bid or Not To Bid

If you needed heart surgery, would you ask three surgeons to submit bids and go with the lowest price?
To Bid Or Not To Bid

If you needed heart surgery, would you ask three surgeons to submit bids and go with the lowest price? Many homeowners think nothing of shelling out tens of thousands of dollars and opening their building project to a builder who was selected based solely on the price. Granted, building is not a life threatening operation. But it could have a definite effect on the family’s well being and financial health. Many factors other than price should be considered before the best contractor for the project is found.

A common tactic is to ask three builders for bids. The homeowner will often throw the high and the low and take the middle bid, confident the risk minimized by dropping both extremes. There can be many reasons for the low-ball bid including shabby materials, poor craftsmanship, inadequate safety precautions or lack of insurance and licensing. Or, if you’re lucky, the bid just may be from an inexperienced builder who’s never done a house like yours before. Price drive the selection. A homeowner should check the builder’s reputation, references, insurance’s and licensing documentation.

One of the first things to check is references. It is important that you talk with people who have hired the builders do a house similar to yours. You will want to ask the references if they had any problems with the work quality, payment schedule, employees or completion time. The most important question you can ask a reference is: “Would you hire this contractor again?” Some people will be hesitant to make negative comments, but the enthusiasm with which this questioned is answered can usually tell you everything you need to know. After you have talked with the references, take a look at the work. Check the quality and craftsmanship and materials, overall aesthetics and creativity.

Also, verify the builder’s licensing and insurance. If you hire a builder who doesn’t carry workers’ compensation insurance and one of the employees falls off your roof, you could be liable for the medical bills and lost wages.

One indication of a professional builder is membership in local or national trade associations such as the Golden Sands Home Builders Association and the National Association of Home Builders. A fly-by-night con artist intent on ripping people off is not going to leave a paper trail by joining a professional trade association.

Once you have done your homework and feel confident that the builder has a proven track record of quality and service, then it is time to discuss the project’s details and price.

As with most job applications, the decision may very well come down to feeling comfortable with the builder and being able to communicate. The builder will be spending many hours at your building project, so it is important you feel comfortable from the outset. You should be able to work together combining ideas and expertise to turn the vision into a final product.

When you have selected a builder to ask for a bid, make sure the bid and eventual contract are as thorough and as specific as possible, including material brand names and models, cost payment schedule, procedure for change orders and completion date.

If you like the contractor and are confident with the work, but the bid comes in beyond your budget, all hope is not lost. Ask what can be scaled down to meet your budget. Look at minor items, such as using stock utility cabinets, instead of custom designed ones, or selecting a different model of tiling, counter tops or trim. Quality is never cheap and good research may seem like a headache. But see what an expensive headache really is by having a low-ball bidder start the job and leave no forwarding address as he skips out with the final payment and project not complete. Do your homework and then choose a builder that will be around today, tomorrow and in the future.

April 13, 2020

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