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Avoid the Cowboys – Top 5 things you should do before appointing a tradesman

22/07/2010

 

1. Decide exactly what you want.

Determine the scope of works, by this I mean list out all of the jobs that you expect the tradesman to do on your behalf. It may be better in the long run to have the tradesman do most of the jobs as often a novice or even competent DIY’er can be more hindering than helpful in terms of a tradesman most efficient way of executing the works.

2. Obtain like for like quotes.

Get a minimum of three quotes, ensure that each of the tradesmen visit the property, confirm that they have priced ALL of the items on your list, included for materials and also provided a programme/sequence of works. You MUST get this in writing. NB If you get a broad range of prices or haven’t got three comparable quotes in terms of scope, get a fourth or even a fifth price. Remember lowest cost is not always best value. Aim to get quotes from referrals if possible.

3. Stop and review.

Review your scope of works in conjunction with your best two quotes. This is the time to step back and think. Are the quotes cheaper/more expensive than you thought?  This is the time to consider changing the scope, sequencing etc. Go back to your two preferred tradesman and advise them of any changes, obtain any re-quote in writing.

4. Final selection, the negotiation stage.

Select your preferred tradesman. It’s important to hold a meeting with your preferred tradesman to discuss programme and payment, make sure that you take notes and keep a copy.

Do not agree to buy all materials ‘up-front’ or pay half now, half at the end. Explain to the tradesman that you are embarking on a property development career, looking to establish long term relationships and want to work together.

Agree a schedule of stage payments based on your scope of works & programme; get this in writing.

Allow 5% of the overall sum for ‘snagging’ Agree on the programme that all snagging will be complete within say two weeks of the completion date, you could consider a damages clause for delays (more later)

5. The Contract.

Once all this has been agreed, you need to enter into contract. This can either be using a formal set of conditions or by letter. If the latter, the letter should state the nature and scope of the works, the programme, schedule and frequency of payments and. making specific reference to and including copies of all correspondence, records of meetings etc. If you don’t formalise matters at this stage, it may well be that the contract formed is verbal. In the event of a dispute arising, it could be very difficult to demonstrate which party was right or wrong.

Make sure that the works are agreed on a ‘fixed price, lump sum’ basis this (subject to no variations) will give you a fixed price.

This probably sounds very laborious and completed but it’s vitally important to avoid potential dispute at a later date. I’ve been involved in this sort of thing for the past twenty years so if you need/want any help, just shout.

No reputable tradesman will refuse any of the above.

Allow yourself a contingency, if you change anything no matter how insignificant to you, it may affect the tradesman’s sequence of work etc. which could incur him in additional cost. Discuss any variations (changes) with the tradesman well in advance.

About Walker Fox

Walker Fox Land & Property Ltd act as professional property sourcers working with investors to add to their property portfolio in Wakefield & the Five Towns (Pontefract, Castleford, Normanton, Knottingley & Featherstone)

Rob Hubbard has over twenty years experience in the construction industry in commercial roles dealing with procurement, valuation of works and variations, agreement of accounts and dispute resolution.

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