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Thursday, March 22, 2018
Article written by Dan Fritschen

Remodeling Costs: How to Control How Much You Spend

There are four key remodeling cost drivers that impact how much you need to spend when undertaking any remodeling project: The design of the remodel, the materials you use, who manages the project, and how you pay for it. This article focuses on where you can save on project management, and three different options you should consider.

When it comes to project management of your remodel, you can:

• Hire a general contractor
• Manage the project yourself
• Hire a fee-based project manager

General Contractors.
General contractors will do the project management for you and usually do some of the work themselves. Often, the general contractor will do the framing, install the doors and windows, do the finish work, install fixtures and then subcontract with others to do the rest of the work.

General contractors typically will provide a fixed bid for your project based on their management of the job and subcontractors, and may charge you additionally for time and materials for the actual work they perform. They will include in their fixed bid a fee for their management time, and possibly will mark up the subcontractors’ fees to cover their own time to manage the variety of subcontractors’ activities. They will also take care of paying all the subcontractors, so instead of writing twenty checks, you only have to write one, to the general contractor. To better understand the costs of employing a general contractor, try the “Manage it Myself” option in the Remodel-or-Move Calculator at www.remodelormove.com. You can also gather information on your remodel at www.remodelestimates.com.

Manage the project yourself.
Just like a general contractor, whose primary duties are to coordinate the activities of the remodel and make decisions on your behalf, you can manage the project yourself. Even if you hire a general contractor, you will be required to make most of the decisions, so doing the task coordination is a natural offshoot of decision making. Even if you don’t have construction experience, there are resources available to help along the way.

The more important question to ask yourself is do you have the time and interest to take on and complete this project? It can take an hour or two each day to keep on top of things, make timely decisions, and follow up on the phone. If you have other things you would rather do, then you should probably hire a general contractor. If you don’t enjoy learning new things or the stress that comes along with hiring and working with subcontractors, then you should definitely hire general contractor. However, if you have good people skills, strong organizational abilities, and most importantly, the time -- then being your own project manager can be a fun and rewarding adventure.

A critical component of managing any remodeling project yourself is finding and hiring good, reliable subcontractors. With a big project, this may take more time than you can budget. If you consider that you may need six or more different skilled subcontractors (electrical, plumbing, drywall and texture, etc.), you will have to interview quite a few people before picking the right person or company for each task, and evaluate at least two estimates from each one. This is where networking helps.

One good subcontractor will often know others. Ask your neighbors and friends; look in the newspapers. Good subcontractors are out there! Also try the contractor referral service at http://www.remodelormove.com. The benefits of being the project manager yourself include the pride of knowing you had a hand in the creation, the empowerment that comes with knowing that you made the decisions along the way that produced fine results, and the money you will save.

As described above, without a general contractor a project can be 20 to 50 percent less expensive. This savings can allow you to make more improvements or keep more of your money in savings. A great tool for helping you organize your remodeling project is The Complete Remodeling Workbook and Organizer available at http://www.remodelingorganizer.com.

Hire a fee-based project manager.
A third option is a compromise between the previous two. Most homeowners choose to use a full-service general contractor, many manage remodel projects themselves, and only a few choose a fee-based project manager. Fee-based project managers will do all the project coordination and subcontractor hiring tasks at an hourly rate, usually between $50 and $100 per hour. They do not mark up the subcontractor charges; you typically will pay them directly.

This can be a very attractive option because it can save you money over using the full services of a general contract, yet take away a lot of the burden of managing the project yourself. Unfortunately, these fee-based contractors are not nearly as common as general contractors, and it may be hard to find one in your area who can do everything that may be required.

No matter which option you choose, you will need the tools to organize the information you will be receiving from many sources. Business cards, quotes, invoices, receipts, contractors, notices, warranties and contracts will all begin to pile up before you know it. Scheduling tasks using check sheets and tables to compare quotes, product specifications and costs can all be organized in one place with The Complete Remodeling Workbook and Organizer. You can learn more about it at http://www.remodelingorganizer.com.

Copyright 2005 ABCD Publishing LLC
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