February 2010

When It Pays to Do It Yourself

Article From HouseLogic.com

By: Oliver Marks
Published: September 01, 2009

Doing home-improvement jobs yourself can be a smart way to save money, but choose the right DIY projects or you’ll end up paying dearly.

Why pay someone big bucks to do something you can just as easily do yourself? That’s the thinking that has gotten more Americans than ever swinging their own hammers. In a recent Time magazine poll, nearly a quarter of people said they were taking on more home-improvement projects themselves-understandably so, when you consider that it usually means a 50% to 75% discount, since all you pay for is materials.

But sometimes doing it yourself costs more than it saves, like when you decide to replace the toilet, end up flooding the basement, and have to pay a pro to fix your mistakes. Or, worse, if you become one of the more than 100,000 people injured each year doing home-improvement jobs. Here are some guidelines for deciding when DIY can save you money and when it could cost you.

Stick to routine maintenance for savings and safety

Seasonal home maintenance (http://www.houselogic.com/categories/maintain-structures-systems/) is ideal work for the DIY weekend warrior, since you can plan tasks in advance and get to them when your schedule allows. Because these are repeat projects, your savings will add up to big bucks over the years. Just by mowing your own lawn, for example, you can save $55 to $65 a week for a half-acre lawn during the growing season. The bigger the lot, the bigger the savings: with two acres, you’ll pocket around $150 per week.

When It Pays: Look for maintenance jobs that are relatively easy and need to be done regularly, so you can hone your skills over time. In addition to mowing, other good ones are snow removal, pruning shrubs, washing windows, sealing the deck, painting fences, fertilizing the lawn, and replacing air conditioner filters.
When It Doesn’t: Unless you have skill and experience on your side, stay off of any ladder taller than six feet; according to the U.S. Consumer Product Safety Commission (http://www.cpsc.gov), more than 164,000 people end up in emergency rooms every year because of ladder injuries. The same goes for operating power saws or attempting any major electrical work-it’s simply too risky if you don’t have the experience.

Act as your own GC on small jobs

If you’re more comfortable operating an iPhone than a circular saw, you may be able to act as your own general contractor on a home-improvement project and hire the carpenters, plumbers, and other tradesmen yourself. You’ll save 10% to 20% of the job cost, which is the contractor’s typical fee.

When it Pays: If it’s a small job that requires only two or three different tradesmen, and you have good existing relationships with top-quality professionals in those fields, consider DIY contracting.

When It Doesn’t: Unless you have an established network of contacts who will show up as promised, the time to spend on oversight, enough construction experience to spot potential problems, and the skill to negotiate disputes between the various subcontractors, trying to manage your own project can quickly send the schedule and budget off the rails.

Pitch in with sweat equity on big jobs

Contributing your own labor on a big job being handled by a professional crew can cut hundreds or even thousands of dollars off the contractor’s bill. Tear the cabinets and appliances out of your old kitchen before the contractor gets started, say, and you might knock $800 off the cost of your remodel, says Dean Bennett, a design/build contractor in Castle Rock, Colorado.

When it Pays: Grunt work-jobs that are labor intensive but require relatively little skill-makes the best homeowner contribution. Offer to do minor interior demolition like removing cabinets and pulling up old flooring, daily jobsite cleanup, product assembly, and simple landscaping like planting foundation shrubs and grass seed around your new addition.

When It Doesn’t: If you get in the crew’s way, you may slow them down far more than you help. Make your contributions when the workers aren’t around, such as in the morning before they arrive, or on nights and weekends after they’ve left.

Put on some of the finishing touches

Unlike the early phases of a construction job, which require skilled labor to frame walls, install plumbing pipes, and run wiring, many of the finishing touches on a project are comparatively simple and DIY-friendly. If you do the painting yourself for a new basement rec room, for instance, you can easily save $1,800, Bennett says.

When it Pays: If you have the skill-or a patient temperament and an experienced friend to teach you-finish work like setting tile, laying flooring, painting walls, and installing trim are all good DIY jobs.

When It Doesn’t: The downside to attempting your own finish work is that the results are very visible. Hammer dents in woodwork, for example, or sander ruts in your hardwood floors may cause you aggravation every time you see them. So unless you have a sure eye and a steady hand, it may not pay to embark on these tasks.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.
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What Your Remodeling Contract Should Say

Article From HouseLogic.com

By: Oliver Marks
Published: September 30, 2009

Review your remodeling contract carefully and adjust it to make sure it protects you in terms of payments, work schedules, and project specifications.

Even if you never intend to pick up a hammer for your remodeling project, there’s one tool that’s absolutely essential-a solid contract. But just having one often isn’t enough. That’s because the document a contractor gives you is designed to protect him. It’s up to you to add in some basic protections for yourself. Here’s what you need to know to make sure the remodeling contract you sign includes solid legal protection for you and your home.

Hiring a lawyer to review and make changes to a contract is a safe bet, especially since each state has its own construction-contract statutes. But not many homeowners are willing to shell out $500 for an attorney review, plus $1,000 to $1,500 additional fees to make wholesale revisions to a flawed contract. However, you can hand-write changes and additions in plain English and make sure both you and the contractor initial each change to the document, says Tampa, Fla., attorney George Meyer, who is chair-elect of the American Bar Association’s Forum on the Construction Industry. Here’s what you want to add (and subtract).

Project specs

Start by reviewing your contract, a process that should take several hours. The most important element of a contract is a thorough and complete description of the project, and the materials and the products that will be used. “It should say that the contractor will secure all necessary permits and approvals as well as what walls are being moved where, what type of countertops are going in, what type of sink, what type of faucet, and so forth,” says Meyer. “You can’t rely on everyone’s memory because if there’s a problem later, people may remember different things.” The contract needn’t contain these specs on its pages, it can simply refer to the contractor’s attached itemized bid. Avoid allowances (http://www.houselogic.com/articles/getting-best-work-contractor/), which are pools of money set aside for work to be determined later, and which often lead to cost overruns.

Payment schedule

The contract (http://www.houselogic.com/articles/getting-best-work-contractor/) should also state the total price for the job, and that it’s a fixed price-not an estimate. It should provide a schedule of how the payments will be made by linking them to milestones in the work-such as when the foundation, rough plumbing, and electricity will be completed-so you’re paying for work only after it’s done. “You should always have enough money left to hire someone else to finish the work if need be,” says Meyer. In general, the first payment should be no more than 10% of the total job and the final payment should be at least a few thousand dollars to ensure that it’s a big enough incentive to get the contractor back for the final niggling details. If you’re unsure whether the payment schedule is proportional to the milestones your contractor suggests, ask a friend who’s familiar with construction process or consult a construction attorney.

Start and end dates

A contractor’s boilerplate contract rarely includes dates for when he will begin work and when he will complete the job, so make sure those details are included. It’s not that he’ll be penalized if it runs late, only that if you ever have a major problem and need to sue him-or defend yourself from a suit he brings-showing that the contractor is, say, two months behind schedule will help you make your case. The dates needn’t be too exacting. If he says it’s a six to eight week job, eight or even nine weeks is fine for the contract, says Meyer.

Statement about change orders

Make sure the contract contains a line stating that any changes that will affect the cost of the job must be priced in writing and countersigned by both the contractor and homeowner before that work commences. That ensures that an offhand discussion about a possible change to the project won’t result in a huge unforeseen additional cost (http://www.houselogic.com/articles/getting-best-work-contractor/). It also helps you, as the homeowner, keep track of exactly how much you’ve added to the bottom line, so you can avoid the very common urge to keep expanding the job.

Binding arbitration

Many contractors include a line that says that rather than going through the courts, disputes will be resolved by an arbitrator. Some legal experts feel that this is a quicker and lower-cost solution to problems, so a binding arbitration clause isn’t necessarily a problem. What can be trouble is if the contract requires a specific arbitrator. “There are some big, national, well-respected arbitrators, like the American Arbitration Association (http://www.adr.org),” says Meyer. “And there are other questionable arbitrators that always side with the contractor. If a particular arbitrator is specified, I’d do some internet research about the agency to make sure it’s legit.”

Warranty

Having the contractor’s warranty in the contract seems like a good thing, right? Well including it is often actually a technique for limiting how much liability the contractor has. “It’s usually loaded up with exclusions and time limits,” says Meyer, “and you’re actually better off with no mention of warranty at all because then the only limits on his warranty are what’s in the state statutes.” In other words, keeping the contractor’s warranty language in the contract will likely mean you’re agreeing to less than what state law provides. For example, state law may specify a longer warranty term than what the contractor’s warranty offers. So, unless you’re having a lawyer review the contract, strike the warranty clause.

Technicalities

There are numerous state-by-state requirements for construction contracts. He may have to include his contractor’s license number, for example, and he may have to include a clause saying you have the right to rescind the contract within a certain time period after signing. And unless you and the contractor sign the document, it doesn’t matter what it says-it’s not a valid contract.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.

Should You Move or Improve?

Article From HouseLogic.com

By: Oliver Marks
Published: August 28, 2009

Whether to move or improve is a harder question to answer than it was a few years ago, but a few cost-benefit calculations can help you make the right decision.

What do you do when your family outgrows your house, or when the quirks you once found charming about the place just aren’t livable anymore? A few years ago, the answers were easy. With house values climbing an average of 50% from 2001 to 2005 and lenders handing out big checks to nearly anyone who asked, you could quickly unload a too-small house and use the profits to help pay for a larger one. Or you could borrow against that growing equity to fund a big home-improvement project, with the full expectation of making your investment back someday when you sold. Flash forward a few years, and the rules of real estate have changed. In this marketplace, with home equity shrinking and banks reluctant to lend, is it smarter to move or improve? Here’s some advice to help you decide.

Moving has gotten harder

With median housing prices down 25% since their peak in 2006, some 15 million homeowners-almost one in four-owe more on their mortgages than they could get from a buyer, according to Celia Chen, senior director of Moody’s Economy.com (http://www.economy.com). And even folks who bought before the big run-up and can afford to sell at today’s lower prices still face steep odds trying to unload their homes with the glut of inventory on the market (36% more lawns wear For Sale signs now than a few years ago). There was an uptick in units sold in early 2009, leading some economists to predict that the market has begun to rebound, but selling a house is likely going to remain difficult for a while.

Still, there can be an advantage to trading up now: If your house has curb appeal and a good kitchen-and you price it right-offers will come. You may not turn a big profit, but once you sell, you become a buyer in this buyer’s market. That means you’ll find what you’re looking for and pay less for it than a few years ago.

To analyze your trade-up options, check local listings to ballpark the price you could realistically get for your home and what you’d have to pay for the next place. Then contact a bank to see if, based on those figures and your financial situation, you’re likely to qualify for the new mortgage. Or do your research online: Investigate home values at online real estate sites and how much of a mortgage you’d qualify for at bankrate.com (http://www.bankrate.com).

Improving has gotten easier

The economic slump has actually made renovating the home you already own a bit easier. The construction-industry slowdown has lowered the cost of some building materials: Plywood is down 46%, for example, framing lumber is down 42%, and drywall is down 25%, according to Bernard Markstein, senior economist for the National Association of Home Builders (http://www.nahb.org). Many contractors are also charging less for labor, to compete for the smaller pool of available jobs. What’s more, you won’t have to wait months for a contractor to show up-chances are he’ll be able to start in a matter of days.

Of course, you’ll still need to come up with cash to pay for the project. And the news is good there, too: As a general rule, improving costs less than trading up. Figure somewhere between $100 and $200 per square foot for new construction or a major remodel, depending on the scope of the project and labor costs in your area. (For help with budgeting and financing, see”Budgeting for a Remodel” (http://www.houselogic.com/articles/budget-for-remodel/) ) A two-story addition with a family room, bedroom, and bathroom costs an average of $156,309, according to Remodeling Magazine’s 2009-10 Cost vs. Value Report. (http://www.remodeling.hw.net/2008/costvsvalue/national.aspx)

Now more than ever, though, you need to make sure that you invest your money wisely. In other words, will your $75,000 kitchen remodel increase your home value by $75,000-or by anything close? For guidelines, check out the Cost vs. Value Report, which gives national average cost and payback figures for 30 popular remodeling projects.
To assess what’s right for your particular house, let your neighborhood be your guide. If there’s any chance that you’ll move within the next 10 years (and in this economy, who can be sure?) keep your improvements in line with those of other houses on your block, or you risk losing the money when you sell.

The most important considerations haven’t changed

Your house isn’t just your largest investment, of course, it’s also the place where your family lives. Financial considerations aside, the question of whether to move or improve should be decided by the things you cannot change about your current home: the school district, the amount of traffic on your street, the size and layout of your yard, your commute, the ease of access to markets and malls, and your neighborhood quality of life. If you love the spot, improving makes sense. But if a different location would be an improvement in its own right, then trading up could be the way to go.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

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Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.

5 Essential Questions to Ask Before Hiring a Contractor

Article From HouseLogic.com

By: Oliver Marks
Published: September 30, 2009

You’re ready to remodel but you want to make sure you get the best contractor for the job. Here’s what to ask the candidates before you decide.

For all of the excitement of choosing plumbing fixtures, cabinets, and tiles for a remodeling project, the most important decision you make won’t involve color swatches or glossy brochures. It’s the contractor you pick that makes or breaks the job. That choice will determine the quality of the craftsmanship, the timeliness of the work, and the amount of emotional and financial stress the process puts on you. To make sure you’re getting the best contractor for the job, here are five questions to ask the candidates.

1. Would you please itemize your bid?
Many contractors prefer to give you a single, bottom-line price for your project, but this puts you in the dark about what they’re charging for each aspect of the job. For example, let’s say the original plan calls for beadboard wainscot in your bathroom, but you decide not to install it after all. How much should you be credited for eliminating that work? With a single bottom-line price, you have no way to know.

On the other hand, if you get an itemized bid, it’ll show the costs for all of the various elements of the job-demolition, framing, plumbing, electrical, tile, fixtures, and so forth. That makes it easier to compare different contractors’ prices and see where the discrepancies are. If you need to cut the project costs, you can easily assess your options. Plus, an itemized bid becomes valuable documentation about the exact scope of the project, which may eliminate disputes later.

The contractor shouldn’t give you a hard time about itemizing his bid. He has to figure out his total price line by line anyway, so you’re not asking him to do more work, only to share the details. If he resists, it means he wants to withhold important information about his bid-a red flag for sure.

2. Is your bid an estimate or a fixed price?
Homeowners generally assume that the bid they’re seeing is a fixed price, but some contractors treat their proposals as estimates, meaning bills could wind up being higher in the end. If he calls it an estimate, request a fixed price bid instead. If he says he can’t offer a fixed price because there are too many unknowns about the job, then eliminate the unknowns.

“Have him open up a wall to check the structure he’s unsure about or go back to your architect and solidify the design plans,” says Tampa, Fla., attorney George Meyer, who is chair-elect of the American Bar
Association’s Forum on the Construction Industry. If you simply cannot resolve the unknowns he’s concerned about, have the project specs describe what he expects to do-and if he needs to do additional work later, you can do a change order (http://www.houselogic.com/articles/what-remodeling-contract-should-say/) (a written mini-bid for new work).

3. How long have you been doing business in this town?
A contractor who’s been plying his trade locally for 5 or 10 years has an established network of subcontractors and suppliers in the area and a local reputation to uphold. That makes him a safer bet than a contractor who’s either new to the business or new to the area-or who’s planning to commute to your job from 50 miles away.

You want to see a nearby address (not a PO box) on his business card-and should ask him to include one or two of his earliest clients on your list of references. This will help you verify that he hasn’t just recently hung his shingle-and will give you perspective from a homeowner who has lived with the contractor’s work for years. After all, the test of a quality job, whether it’s a bluestone patio or a family room addition, is how well it stands the test of time.

4. Who are your main suppliers?
You’ve found a few potential contractors, you’ve talked to the happy former clients on each of their reference lists, now it’s time for one additional bit of homework: talking to their primary suppliers. There’s no better reference for a tile setter, for example, than his preferred tile shop; for a general contractor than his favorite lumberyard or home center pro desk; for a plumber than the kitchen and bath showroom where he’s on a first name basis.

The proprietors of these shops know a contractor’s professional reputation, whether he has left a trail of unhappy customers in his wake, if he’s reliable about paying his bills-and whether he’s someone you’ll want to hire. The contractor should have absolutely no qualms about telling you where he gets his materials, as long as he’s an upstanding customer.

5. I’d like to meet the job foreman-can you take me to a project he’s running?
Many contractors don’t actually swing hammers. They spend their days bidding new work and managing their various jobs and workers. In some cases, the contractor you hire may not visit the jobsite every day-or may not even show himself again after you’ve signed the contract. So the job foreman-the one who’s working on your project every day-is actually the most important member of your team.

Meeting him in person and seeing a job that he’s running should give you a feel for whether he’s someone you want managing your project. Plus, it gives the general contractor an incentive to assign you one of his better crews since you’re more likely to hire him if you see his A Team. If the contractor says he’ll be running the job himself, ask whether he’ll be there every day. Again, he’ll want to give you a positive response-something you can hold him to later on.

It’s not only the answers to these questions that will help you judge potential contractors-it’s the way they answer them. Were they easy to talk to and forthcoming with details or did they hem and haw and make you ask more than once? Difficulty communicating now means difficulty communicating on the job later. But clear, timely and thoughtful responses-combined with terrific references, great completed work that you’ve seen, and a smart take on your project-may mean you’ve found the right pro for your job.

A former carpenter and newspaper reporter, Oliver Marks has been writing about home improvements for 16 years. He’s currently restoring his second fixer-upper with a mix of big hired projects and small do-it-himself jobs.

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.

Budget for a Remodel

Article From HouseLogic.com

By: Oliver Marks
Published: August 28, 2009

To calculate how much remodel you can afford, follow these four steps: Ballpark the cost, establish a spending limit, make a wish list, and set your priorities.

What’s on your remodeling wish list? Maybe you’re longing for a spa-like master bathroom, a new eat-in kitchen, or a garage with space enough to fit your cars and your outdoor gear. Well, when it comes to home improvements, knowing what you want is the easy part. The tougher question is figuring out how much you can afford. Follow this four-step plan to arrive at the answer.

Ballpark the costs

The first step is to get a handle on how much your remodeling dreams will cost. Remodeling Magazine’s 2009-10 Cost vs. Value Report (http://www.remodeling.hw.net/2008/costvsvalue/national.aspx) gives national averages for 30 common projects. Or you can use a per-square-foot estimate: In general, major upgrades, such as a bathroom remodel or a family-room addition, run $100 to $200 per square foot. Your local National Association of Home Builders (http://www.NAHB.ORG) affiliate can help with estimates. At this point, you’re not trying to nail down exact prices, but to get a rough sense of what your project might cost.

Figure out how much you have to spend

Once you have a ballpark cost estimate, the next question is whether you have the money. If you’re paying cash, that’s pretty easy to answer. But if you’re borrowing, you need to assess how much a bank will lend you (http://www.houselogic.com/articles/a-guide-to-equity-loan-options/) and what that loan will add to your monthly expenses.

For the vast majority of homeowners, the best way to borrow for a home improvement is a home equity line of credit (http://www.houselogic.com/articles/consider-home-equity-line-of-credit/). A HELOC (pronounced HEE-lock) is a loan that’s secured by your home equity, which means that it qualifies for a lower rate than other loan types, and you can deduct the interest on your taxes. Because a HELOC is a line of credit rather than a lump-sum loan, it comes with a checkbook that you use to withdraw money as needed, up to the maximum amount of the loan. For help shopping for a HELOC, download our free worksheet.

The catch is that the minimum payment on a HELOC is just that month’s interest; you’re not required to pay back any principal. Like only paying the minimum due on a credit card, that’s a recipe for getting stuck in debt. Instead, establish your own repayment schedule. You can do this simply by paying 1/60th of the principal (for a five-year paydown) or 1/120th (for 10 years) in addition to the monthly interest. If you can’t afford that much, then you should reconsider your project.

Get quotes from contractors

Once you have ballpark estimates of what your job might cost and how much you can spend, you know whether it’s feasible to move forward. Assuming the numbers are within shooting range of each other, it’s time to get a nuts-and-bolts assessment of project costs.

Don’t ask contractors for bids yet, though. First, you need to determine exactly what you want, right down to the kitchen countertop material and the type of faucet. By specifying these details up front, you ensure that contractors are all pricing the same things, rather than the countertop and faucet they assume you want. If you’re using an architect or designer, bring them in now to help with these choices. If not, consult magazines, go to showrooms, and visit friends’ houses for ideas.

Next, get recommendations for at least three contractors from friends, neighbors, and other tradesmen that you trust. Give each one your project description and specific product lists and request an itemized bid. To make a final decision, assess some of their previous work, their attitudes, and their references, and then choose the contractor who impresses you most.

Prioritize and phase

Reprinted from HouseLogic (houselogic.com) with permission of the NATIONAL ASSOCIATION OF REALTORS®
Copyright 2009. All rights reserved.

Open Source Documents-Unbelievable Resources-Find YOUR topic of Interest

If you’ve never visited http://www.Archive.org, you are missing a wonderful site.  From this site, you will find many resources that are out of copyright and you can download and use them as you wish.  You will find all the classics and some fun things as well.  Just for fun, I have the download of a book called “Little Gardens” which is a book about setting up a garden on a city lot.  This is just one of the MANY fun things you’ll find.  You can download and watch old music, movies, and cartoons as well.  Plan to spend some time on the site should you decide to visit, as it is very cool.  Click here to download the book Little Gardens