The Biggest Myths About Hiring a General Contractor for a Remodel

When planning a remodel, it's common for people to quickly turn their attention to finding a general contractor (GC). But before jumping headlong into hiring someone, homeowners should make sure that they fully understand what they're getting when hiring a general contractor.

In this post, I'll help in that process by going over some of the biggest and most common misunderstandings and misconceptions about the role of a general contractor in a home remodeling project.

Misconception: “General Contractor” Means “Full Service”

General contractors are responsible for managing project timelines and budgets, but that doesn't mean they offer the full scope of services that you need to complete a high-quality remodel.

Most general contractors are construction managers and don't handle design work. That means that you'll need to hire an architect or interior designer to create the project plan before you hire a general contractor.

For a remodel to be truly successful, you need both great design and expert execution. Even when a GC can deliver the latter, they typically can't help much with the former. On top of that, some GCs will take issue with the project plan that you bring to them -- they may want to make changes, or they may estimate a higher price than you anticipated for doing the work.

Misconception: Line-Item Contracts Are the Most Dependable Type of Budget for Construction Work

Most homeowners assume that a line-item contract (also known as a time and materials contract) is the best for optimizing their budget and avoiding unanticipated costs. This line of thinking is understandable, but it's also a misconception.

The problem is that a line-item contract is really just a glorified price list. It tells you what you'll pay per hour or per unit for different types of labor and materials, but it offers no guarantees about how much of each line item you'll actually need.

When a general contractor submits a bid, there's no requirement that they hit their estimate. It's the customer who foots the bill if they underestimate what it takes to do the job.

So while the line-item estimate seems transparent, it actually offers very little reassurance to homeowners about what they'll really pay in the end. This is why some general contractors become known for the practice of habitually underbidding just to win business, knowing they'll recoup the costs when the final bill comes due.

In reality, the most dependable type of contract for homeowners is a fixed-price (or lump-sum) contract, since it features an "all-in" price, putting the remodeler on the hook for any higher-than-expected costs.

Misconception: The General Contractor Does Most of the Work in Your Home

While a general contractor oversees the construction process, they are rarely the person actually doing work on your property. General contractors often provide skilled labor and subcontractors for specialized work, including plumbing, painting, and electrical work.

There isn't anything inherently wrong with this. After all, it's hard for anyone to be a master of all the trades needed to complete high-quality work in a home remodel. However, it means that you're not relying on the general contractor's technical skills so much as their ability to hire and manage subcontractors.

If you hire a general contractor who works with subpar subcontractors or struggles to keep subcontractor schedules organized, it can lead to disappointing results for your project.

Read more: Questions To Ask Your Remodeling Contractor

Misconception: A Handshake Agreement Is Good Enough

Many of us long for the good old days when a handshake was enough for almost any kind of transaction. But that's certainly not the case anymore, including in the construction industry.

Clients should communicate their vision clearly to remodelers and general contractors. A comprehensive project roadmap should include clear timelines and efficient resource allocation. As part of that, a detailed written contract should reflect that vision and plan, specifying the full scope of work, materials to be used, price breakdown, payment schedule, responsibility for cleanup, and any warranties or guarantees.

Even if you have deep trust in a remodeler or contractor, having these items in writing offers clarity and protection for you and the firm you hire.

Misconception: General Contractors Are Qualified for All Types of Remodeling Projects

General contractors oversee construction and remodeling projects, but that doesn't mean they are qualified for everything. For some types of projects, especially high-end or custom remodeling, it's important to hire someone with direct experience doing comparable work.

Choosing a contractor with relevant experience involves selecting one who has worked on similar projects and reviewing a portfolio of past work. If you have any complex or custom elements of your remodel, ask to see examples that demonstrate that the contractor has the know-how to get the job done.

Even further, homeowners should ask for references and check reviews before hiring a general contractor. Whenever possible, you want to contact multiple past clients to inquire about the contractor's experience, communication, and problem-handling abilities.

Taking these steps before hiring someone can prevent all kinds of headaches and regrets down the line.

Misconception: You Don't Need to Check a Contractor's Documents

Too often, homeowners take for granted that a contractor who submits a bid actually has all their paperwork in order. But it is worth checking and making sure that anyone you might hire is fully licensed, bonded, and insured.

General contractors must be licensed and insured to operate legally in most areas. Iowa does not have a specific 'general contractor' license, but all contractors earning over $2,000 annually must register as a construction contractor with the state's Department of Inspections, Appeals, & Licensing (DIAL).

There are also other regulations for remodeling professionals in Iowa:

• Iowa requires a $25,000 surety bond for registered contractors, which provides some financial protection if the contractor fails to meet their obligations to the project owner. In reality, homeowners should ensure that the firm is bonded for a much higher amount.

• Contractors must maintain public liability insurance (minimum of $500,000 in coverage) and workers' compensation insurance if employing workers.

• Contractors must secure necessary building permits and adhere to local building codes, safety standards, and state regulations. In our area, contractors must obtain all local building permits and schedule inspections with the Des Moines Permit and Development Center.

Before hiring a remodeler or contractor, you can ask to see their documentation to make sure that everything is on the up-and-up.

Misconception: Hiring a General Contractor is Your Only Option for a Home Remodel

Unfortunately, many homeowners are stuck thinking that their only option is to hire a general contractor for their remodeling project. There's actually a compelling alternative: hiring a design-build remodeler.

Design-build firms offer true full-service work, handling the entire project from soup to nuts. They have in-house designers who create the project plan and an in-house production team that carries out the construction plan. Throughout the project, these team members can collaborate, allowing them to take advantage of the entire firm's expertise (while also reducing the risk of miscommunication).

Most design-build remodelers offer fixed-price contracts, which, as I mentioned before, create a more predictable budget with less risk for homeowners. Working with just one firm also creates a single point of contact, so the entire process unfolds more smoothly and with more transparency for clients.

Planning Your Home Remodel in Des Moines, Iowa

Compelling Homes is a design-build remodeling company with nearly two decades of experience working in the greater Des Moines area. We specialize in custom remodeling, working closely with homeowners to create tailored project plans and deliver stunning results.

If you're thinking about a remodel, we'd love to chat. Contact us today to schedule a consultation about how we can work together to upgrade your home and make it uncompromisingly compelling.