You think, “I’m an educated person. I work with people, respond to deadlines, and deal with budgets every day. I know my way around a spreadsheet and the internet. What’s the big deal? I bet I could handle being the general contractor when we remodel our home. It sure would save us some money.”
Hiring a general contractor (GC) has its pros and cons, just as being your own GC has its pros and cons. Just talk to any homeowner who lived through their own construction project. Regardless of the size of the project, they will have words of wisdom to share. We, as architects, have participated in many projects built by contractors and quite a few by homeowners. Here are some important points to consider when making the decision whether to be or not to be your own general contractor.
Hiring a General Contractor
Overhead and Profit: GCs are in business to make profits, so you may expect that they will add between 15 and 20% (or more) to the cost of materials and labor. On the flip side, they can purchase materials and fixtures at wholesale or with a contractor’s or volume discount to which you may not have access.
Time: A good general contractor will be able to give you a general timeline and an anticipated date of completion. The GC will also keep you on track for making timely selections. It is frustrating to learn you didn’t order the new windows early enough to arrive when the house is being framed. Delays are cumulative and will cause a ripple effect through your schedule.
Making Changes: If you make unscheduled changes to the scope of work during construction, you may get pushback from the contractor. Most GCs work on fairly strict project timelines: otherwise, they risk losing clients and money. There are contractors who are more flexible and are accustomed to working on custom projects where adjustments during construction are expected. Be sure to ask questions when interviewing GC candidates.
Logistics: It’s part of a general contractor’s job description to coordinate all work done by subcontractors; check to see that the work is completed in compliance with local building codes; warranty the work and deal with any problems that develop during and after construction, and collect lien releases and process payments.
The Unexpected: Suppose your home is a historic property. An experienced general contractor will know how to handle the challenges that older wiring and plumbing systems, as well as an aging structure and foundation, may pose. Good GCs will not only know the safest, most cost-efficient way to work; they will also know who to call to get the job done.
Being Your Own General Contractor
You are in Control: As the Owner and the General Contractor, you have the ultimate control in the decision making. You control not only what gets done, but also how, when, and by whom. You have the opportunity to create something personal, useful, and beautiful. If you do it right, being your own GC earns you full and unlimited bragging rights.
Saving Money: If you are good with numbers, resourceful with finding deals, negotiating, and keeping a close eye on your budget, you should be able to save money at the end of the day. Right off the top, you won’t be paying the GC’s overhead and profit. The cost of labor is always a big portion of any construction project, so if you are good with tools and can measure accurately, you may benefit from putting in your own sweat equity. Keep in mind you’ll have the cost of renting equipment if you or your subcontractors don’t already own it. Also, if your project is large enough, purchasing a membership in one of those wholesaler-direct-to-buyer programs might make financial sense.
Fun, if you have the Time: Being your own GC can be fun and rewarding, possibly even addicting. However, be realistic about how much time you can devote to the project. If you already have a full-time job that has a demanding schedule and has you traveling several times a month, you may not have the time that is required to stay on top of the day-to-day operations of your project.
Financing and Insurance: You should know that if you act as the general contractor and need a construction loan, it may be tricky to get one. Most banks require that a general contractor be on a project. They may want to see proof of liability and worker’s compensation insurance and bonding. You may also run into problems with your homeowner’s insurance company as well. They may also require that a GC be signed on before they insure a house during construction.
Speaking the Language: You need to know how to read the architectural drawings. Architects, home plan designers, even your nephew in architecture school are all trained to draw lines on paper that then translate to what is being built. It is a language just like any other. If you don’t understand what’s on the page, then it is difficult to direct others in building it correctly.
Subcontractors: You will be hiring subcontractors, such as carpenters, plumbers, electricians, concrete workers, millwork builders, painters, countertop fabricators, tile installers, drywall installers, glass and mirror installers, and on, and on. Check out their credentials very carefully. Create a contract with them so that each of you is clear on the details of what work is being provided and who is responsible for which expenses.
Dealing with the City: The inspectors at your City will not buy the excuse, “I didn’t know I had to pull a permit; schedule an inspection; pay that fee.” For example, if you install the drywall before the inspector has signed off on the wiring or plumbing, be ready to open the wall back up – at your own expense. Ask plenty of questions before you begin.
If you still can’t decide which option would be best, you can always talk to the architects at HPD about your individual situation. We’re always happy to share the details about the risks and rewards associated with hiring a general contractor or being your own GC.
If you want some more ideas for improving your home environment, hpd architecture + interiors can help. Just give us a call at 214.751.2304.
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