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Contract for General Contractor

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  • May 20th, 2021 9:56 pm
[OP]
Newbie
Feb 15, 2021
10 posts
4 upvotes

Contract for General Contractor

This forum has been a terrific resource for me as a new property owner so thank you everyone for that. I'm hiring a general contractor to do a major condo reno, and I'm wondering about contracts.
1) You never pay a deposit without a contract on a large job, correct?
2) Is 15% deposit okay? I've heard it's usually between 10% to 15%.
3) Do you usually get a lawyer to look over the contract? How do you find a lawyer that specializes in this sort of thing?
4) Do you usually ask the contractor for references - is this standard? They were recommended to me by the building management, so that's one reference, but I'd like to talk to at least one other.

I just want to cover my bases before getting started, without being unreasonable.
Thanks!
2 replies
Member
Jan 22, 2013
221 posts
93 upvotes
Vancouver
I think the smaller the job, the higher the deposits usually as start up costs for projects tend to be roughly the same. I paid 10% deposit at signing and another 10% once we received building permits and were ready to actually start. For a much more expensive house remodel it could be as little as 5% which on a $1m reno would be 300k.

It's totally acceptable to ask for references, mine was referred by my designer and we also saw two of his other projects in person that were nearly complete.

I just signed the contract which he walked me through, no lawyers involved.
Deal Addict
Jun 26, 2019
1411 posts
1142 upvotes
GTA
CedarGray wrote: This forum has been a terrific resource for me as a new property owner so thank you everyone for that. I'm hiring a general contractor to do a major condo reno, and I'm wondering about contracts.
1) You never pay a deposit without a contract on a large job, correct?
2) Is 15% deposit okay? I've heard it's usually between 10% to 15%.
3) Do you usually get a lawyer to look over the contract? How do you find a lawyer that specializes in this sort of thing?
4) Do you usually ask the contractor for references - is this standard? They were recommended to me by the building management, so that's one reference, but I'd like to talk to at least one other.

I just want to cover my bases before getting started, without being unreasonable.
Thanks!
First things first, seeing as its Covid I would 100% recommend you getting all the materials on hand before you start. Work with your contractor, maybe say you can store stuff in the storage locker or one room while you gather everything. Then pay for all the materials. Sure if you want to add another little bit as a deposit, I don't see much harm, but really if you just pay for materials + a bit of markup, the contractor should be satisfied to start.

During Covid it has been insane, how many contractors start a job, demo a kitchen or something, then come to this crazy realization that they can't get cabinets or something else critical. Then they pack up, and leave you without a bathroom or kitchen for 10 weeks until something comes in. So stuff like this is just crazy. So long story short, work with you contractor, make sure you have all your bases covered, so you're displaced for 6 weeks instead of 16.

1) You should always have a contract that clearly states as much as possible. The exact scope, materials, dates, etc, etc.

2) Basically what I said above. If you pay for all materials, that will probably be stored at a place you own, then maybe a bit extra, or just see what the contractor wants and if it reasonable go for it. Really, covering materials and bit up front should be fine. After they demo you entire condo, you're most likely in the worst spot. Then the contractors exposure builds, until he gets to the first agreed upon milestone and gets paid. So figuring out these milestones and how much of the contract you pay at each step is most likely more critical than than the deposit. That said, I would always hold 10% or some amount until everything is 100%. Just in case there is this one piece of trim or something small that some contractors would take 8 weeks to get around too. But if you're holding 10% or something, they will get it done really fast.

3) Don't really think lawyers are needed. Depends how much you're looking at I guess, but it is not a standard practice whatsoever.

4) Yes, ask for references, pictures of past work, check online, do your homework, etc etc.

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