ASK YOUR BUILDER...
DO YOU HAVE YOUR OWN STAFF?
If your main contractor employs their own tradespeople, how many? It can work both ways: direct staff are easy for him/her to get hold of and control and, depending on the salary, usually works out cheaper than employing subcontractors, even taking into account the additional pension, NI, holiday contributions and so on. It is certainly a sign of the business being established. On the other hand, many main contractors struggle with the time it takes to co-ordinate and set up their staff every day and deal with all the admin involved in employing people – rather than bringing in specialists as and when required.
TELL ME ABOUT YOUR SUBCONTRACTORS…
Ultimately, the people carrying out the work will not be your main contractor but the tradespeople he or she employs. You’ll need to find out about them and their work. How good is the bricklayer? Can they do the mortar lines you want? Is the electrician they use able to install a smart thermostat?
ARE THEY HAPPY TO GIVE YOU CONTROL OF KEY AREAS?
Chances are, you have your heart set on a particular set of doors, windows, bathroom, kitchen, or even heating system. Your main contractor will have their own views and their own set of contacts in these areas – some of which they might expect to make a percentage off for supplying to you. Is your main contractor willing to let you take on these packages, and what are the implications?
WHAT ARE THE PAYMENT TERMS?
Main contractors require working cash flow to pay their tradesmen – either weekly or monthly – and for a while you’ll be the main source of this cash. Most projects work on a stage payment basis, with the main contractor splitting the contract into a handful of stages and invoicing at the end of each element (e.g. roof on and secure, first fix complete, etc.). Money is one of the few elements of leverage you have as a homeowner, so you would ideally be holding as much of this towards the end of the project as possible. Beware contracts that are front loaded, i.e. the bulk of the overall payment is balanced early on. So-called commencement payments are fine, within reason – but again, you shouldn’t be paying for small day-to-day materials or tradesmen. If you want a £20,000 kitchen, on the other hand, why wouldn’t you buy it yourself rather than ask the builder to fork out for it or even put it on their account and use up all their credit?