Home Owner Alert – The Craigslist Contractors to Avoid
The allure of Craigslist contractors for your renovation job is obvious – the cost.
Chances are, your project is going to be much less than if you hired a contractor through more traditional channels. But in the end, the true costs may be hidden. You may be putting yourself and your home at risk. And you may be breaking the law.
What Losing $15,000 Can Teach Us about Contractors
Such is the story of a man from New Westminster, BC, who needed a handyman to build a dormer and bathroom in his home. This gentleman didn’t have a contract, and relied on an email from the renovator detailing what the job would cost. The end result – it was a disaster.
The homeowner had saved for years for the work, but is now borrowing from a line of credit to finish the botched job that the handyman performed. At first, the project seemed to be going well. The work was plugging along, as the contractor built the walls and got the roof on. Then, without notice, the work stopped. The contractor never finished the job.
It was built improperly, and the dormer sank half an inch into the kitchen. There were no structural beams, and everything was just thrown together. And even though a permit was obtained, the structural engineer performing the inspection failed it. In the end, the homeowner has been left with a monetary loss of around $15,000.
Don’t Forget These Critical Things When Looking for Contractors
The story is not uncommon, and shows how homeowners can be too trusting of Craigslist contractors, and are left on the hook for thousands of dollars and more. Home renovation is a multi billion dollar industry in Canada, bigger even than new housing construction.
With popular television shows like Love it or List it, House Hunters Renovations, and Holmes on Homes inspiring a generation, people are turning their old homes into new and functional spaces in which they can live or grow. Nevertheless, renovating a home has risks, especially in the hands of unskilled and/or unlicensed tradespersons.
The word “contractor” is a derivative of the word “contract” – and that is exactly what you are going to need if your renovations go awry. Any renovation contract should be detailed enough to indicate the costs and specs involved with the work being done, and to protect the homeowner in the event things go wrong.
The contract should fully outline the roles and responsibilities of both parties – the contractor and the homeowner – what is to be done, when the money is to be paid. What’s most important is to ensure the contractor or tradesman is compliant with WorkSafeBC regulations, because if that’s not the case, the homeowner is assuming a huge risk in the event someone is hurt while working on their home.
Peter Simpson, President and CEO The Greater Vancouver Homebuilders Association
How Contracts Minimize Risk
According to health and safety laws surrounding jobs such as home renovations, the homeowner needs to assign prime contractor status to a company that is working on their property. This is to protect the homeowner from having the responsibility to ensure all the workers are complying with health and safety regulations.
In British Columbia, for example, if you don’t assign a role of “prime contractor” to the company, you can be liable or financially responsible for any injured workers who aren’t registered with WorkSafeBC.
Unfortunately, thousands of unlicensed or unscrupulous contractors are breaking the law every day by posting deceptive ads on sites like Craigslist. In addition, these contractors are creating an unfair playing field in which legitimate companies cannot compete, mostly due to the low rates that these unlicensed businesses are offering.
A lot of people try to save money and take shortcuts and turn to Craigslist to hire someone that they know nothing about.
Keep in mind that it is the homeowner that must take responsibility to check out any contractor:
- Is the company is a member of the Better Business Bureau?
- Have they had any trouble in the past?
- Do they carry liability insurance?
A written contract alone is not sufficient when hiring a contractor. You need to use your due diligence and check out all the references, and even visit past jobs that they have worked on to see what kind of result they will give. With a reputable business, research done, and a contract in writing, you are protecting yourself as the homeowner. That way, if anything happens to your home, yourself or to the contractor, you are covered. Further, if for whatever reason the job ends up in legal trouble, a contract will be binding in court.
Risks of Hiring Unlicensed Contractors from Craigslist Ads
It may seem tempting to hire someone that offers “cash only” or tax breaks on the final fee. And beware of the so-called “contractor” that skips out on getting permits for the work he or she is doing. You may get an unexpected visit from a city building inspector, who will promptly shut down your renovation if you don’t have the proper permits.
This could significantly delay your renovation, and worst case scenario, could cause your “Craigslist contractor” to take off with your money and not finish the job at all. If caught, the homeowner has two options: either obtain the proper permits, which will can end up costing double the original fees, or remove the work completely.
How Legitimate Contractors Compete
Sites like Craigslist are having a negative effect on legitimate contractors. In fact, they are potentially ruining the trades in general by driving down labour pricing expectations. Even though these Craigslist contractors are offering low introductory rates, the homeowners often end up spending more in the long run on hidden costs and recoups.
Legitimate contractors are combatting this culture by being accountable, having pricing up front (either on-line or in advertising), and being totally transparent in terms of fees and work to be done. They’re also relying on word-of-mouth from past clients to help their prospective clients see the quality of their work and the experience that their customers had.
Overall, if you are about to undertake the task of renovating your home – whether on a small or large scale – protect yourself and your bank account by doing your research. Even though it might seem desirable to pay the lower price for the job, it is often not worth it in the long run, and could end up costing you thousands of dollars above what you initially intended to spend.
Finally, it’s important that home and condo owners undertaking renovations, verify the liability and workers’ compensation coverage of contractors. To be as protected as possible, make sure the contractor has proper licenses, solid references and both workers’ compensation and commercial general liability insurance coverage. Most home insurance policies require owners to notify their insurance providers of any renovation costing more than $5,000.