Building a new home is a big investment and not for the faint at heart! If you want a home building experience that’s relatively stress-free and budget-friendly, be sure to interview and hire the right builder.
A qualified builder is there to oversee your new home construction project from start to finish, hire and oversee subcontractors, order and purchase materials, interact with building and zoning officials and inspectors, and ensure your dream home meets codes and regulations.
To find the right person for the job, here are 7 crucial questions you need to ask:
1. Are you licensed and insured?
A reputable builder will have a professional province-issued contractor’s license, a local license to do business, and enough business or commercial General Liability (GL) insurance to cover a residential construction project — usually $500,000 or more. GL covers property damage or bodily injury, medical payments, and legal defence costs in case of litigation.
In addition to being licensed and insured, builders with two or more employees are required to carry Workers’ Compensation insurance which covers accidents and injuries on the job, including wage replacement, medical treatment, vocational rehabilitation, and occupational illnesses.
2. How many homes have you built?
Don’t let the home improvement shows fool you! Building a house may look simple, but don’t hire a DIY wannabe. Your local building and zoning commission will insist that certain phases of your project such as electrical, plumbing, and HVAC, be completed by licensed contractors.
New homes must be built to code, meet city regulations, and pass strenuous inspections before the city will issue a certificate of occupancy. During the interview, ask the builder for a list of addresses or a website which features past projects.
3. Do you have references?
The Better Business Bureau (BBB) and other websites that issue ratings for area contractors are a good place to check references and ascertain whether a prospective builder has a good reputation for completing projects to the customer’s satisfaction.
The BBB publishes negative and positive feedback and reveals whether there are pending complaints or lawsuits against a contractor. Ask the builder for a list of references and be sure to check them out.
4. Will you present a contract and will the contract include a scope of work?
Gone are the days when deals were sealed with a handshake and a cup of coffee. Be sure to get a purchase contract and a full understanding of how your new home construction will proceed.
A written agreement between homeowner and builder will include contact information for both parties, physical and legal address of the property, and a scope of work stating in precise terms the nature of the building project, the cost, how and when contractor payments are to be made, special stipulations, warranties, and signature blocks for all parties concerned.
Before you sign the contract, consult with your attorney and make sure you’ve covered all contingencies, including what happens if either party elects to cancel the contract before work is completed.
5. Can we make revisions to the scope of work? If so, will revisions affect the overall cost?
The most common mistake homeowners make is assuming changes, revisions, and alterations to an existing construction agreement can be made easily and the costs absorbed into the original contract.
Bear in mind your builder’s proposal is based on constructing your new home according to the original blueprint and within a specified budget. Add-ons, upgrades, reorders, and alterations cost more money and should be negotiated with your builder. A professional contractor will keep good financial records and provide a running account of costs.
Another inquiry to make regarding costs is whether or not the builder is currently offering any promotions. This could get you certain price reductions or upgraded features at a lower price. But remember, no two builder promotions are created equal so don't let this affect your decision heavily.
6. Who is responsible for paying subcontractors and suppliers?
Unscrupulous builders often leave subcontractors and suppliers unpaid, which can be problematic for homeowners. Unless otherwise specified, your new home construction contract should stipulate how and when the builder should pay all subcontractors; and that money should be a part of the overall project price.
Don’t be duped into paying out of pocket for labour and materials that should be part of your contract. Read what you sign and sign only if you understand the stipulations.
How important are subcontractor and supplier payments? If at the end of the project, there are outstanding bills, those subs and suppliers could legally put a lien on your property until the debt is paid!
7. Who will keep the job site clean and dispose of construction waste?
Again, part of your contractor’s agreement should include provisions for cleaning and disposing of construction waste. A professionally managed project should include waste management: daily cleanup, delivery of a trash bin or dumpster, and heavy construction debris removal — all priced into the contract. As the homeowner, you can be fined by municipal authorities if trash and debris are not cleared from your property in a timely manner.
The Bottom Line:
Don’t become so distracted by the prospect of building your new dream home that you neglect to keep a level head when choosing the right builder. Take time to conduct a thorough interview and ask the right questions to make your building project a dream come true and not a nightmare.
Luckily, Calgary is home to some of the best builders in the business; here are 12 advantages of working with a Calgary home builder.