5 THINGS YOU MUST KNOW BEFORE HIRING A TRADIE
If you’re about to undertake a renovation on an investment property, here’s how to make sure you’re not being ripped off.
As a home owner and property investor, there are some key areas to check when using a tradie for construction work on your property. There are different laws designed to protect you, as the home owner, and regulate residential building work. These can cover construction work on single dwellings, villas, houses and units.
1. Once the cost of materials and labour for a construction job reaches a certain limit, you need to engage a licensed contractor.
By law, all builders and tradies must be licensed for the type of residential work they perform where the cost of the job is above a certain amount set by your State or Country (in some specialist trades, such as electrical and plumbing they are required to be licensed regardless of the amount). You should always confirm the licence details of your tradie by completing a licence check. Think of the contractor’s licence as the equivalent of quality assurance label on a consumer product. There is usually a very good reason why a tradie is unlicensed (common examples include a history of poor or faulty workmanship and no formal qualifications, to name just two). By using an unlicensed tradie you run the risk of any warranties being voided and work performed being either substandard or illegal, which can result in additional cost for the work to be rectified. By looking to cut corners and save a few dollars upfront by using an unlicensed tradie, you run the risk of substantially more cost being incurred down the track.
2. A written contract is required to be provided by your tradie for residential building work valued over a certain amount set by your State or Country.
For smaller jobs, the information required regarding a job is quite basic. However, for jobs valued over the set amount, the information required is far more extensive and designed to outline the rights and responsibilities of both parties to the contract. Some of the main areas to be included are an accurate description of the works to be carried out and the contract price clearly detailed or an explanation provided for why it cannot be (if this is not provided, don’t sign the contract).
3. Key Benefits of having a legitimate contract in place include clear details on what happens in the event of a dispute and how variations (which can be common) are to be addressed.
This reduces the risk of any grey areas arising as to what was and wasn’t covered in the original contract. Bottom line, without a contract in place that details both parties’ obligations, there is an increased risk of disputes arising, which is in no one’s interest. So be wary of a tradie who does not provide you with a clearly detailed and professionally written contract. The last thing you want is to get chased by the debt collector claiming you owe a tradie money because of “additional” work which could and should have been clarified before the job began
4. Your tradie may also ask for a deposit to be paid prior to work starting.
There are different rules surrounding deposits in each State and Country. If your tradie requests a deposit from you, ensure you review the laws in your area to make sure the deposit fits within those boundaries.
5. Home warranty insurance.
In some areas, this insurance is required by law and is designed to allow you to make a claim for loss due to defective or incomplete work, in the event your tradie suffers insolvency, death or disappears. Be aware that not all tradies are licensed for this type of work, so once again – check this before commencing. If not, good old “Murphy’s Law” may happen at some point in the future when you need to make a claim.
By knowing these basic rights, you ensure your project has the best chance of running smoothly, without the risk of being caught our and costing yourself financially.