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Cash in handPublished on 25th Jul 2012 The Treasury Minister David Gauke slated tradesmen and homeowners for using cash payments in transactions for building work. Oddly, this was something that Ryan Notz was already writing a blog about, focusing on how VAT thresholds are the real problem. http://www.mybuilder.com/blog/why-builders-ask-for-cash/ He was also asked to comment on the problem for the Daily Telegraph http://www.telegraph.co.uk/finance/personalfinance/consumertips/tax/9422946/Tradesmens-anger-over-cash-in-hand-claims.html

Why you should pay for quotes Ryan Notz August 8, 2012 21 Comments As consumers, we are used to comparing prices. After all, a better deal is usually only a mouse click away. But this has become so much a part of everyday life that the mere suggestion of paying someone to give you a quote sounds utterly absurd. Well, call me absurd, but I’m about to suggest that you do just that. I firmly believe that it’s often in your interest to pay for a quote from a builder. Let’s take the case of a house extension. “How much will it cost to extend my house?” you might ask a builder. “How long is a piece of string?” he would reply. “Ha ha, but really… roughly how much?” Your question seems reasonable enough to you. Of course you understand that it depends exactly what kind of extension you want, but you still need to know roughly how much you’re looking at before you decide. Will it be £20,000, £40,000 or (heaven forbid) £60,000? Of course, it’s easy enough for a builder to ask a few straightforward questions and reply with one of those numbers as a ‘guesstimate’. However, most good builders would not do that and with good reason. A house extension is very complicated, not least because it involves an existing property, which has all kinds of quirks, constraints, unique problems and unknowns. It also requires teamwork and careful orchestration of multiple trades. But even before you hit all those problems, you need to decide what exactly you’re building… which is not easy in itself. In order to start getting to grips with the scale and cost of a project, you need a plan. Getting a plan drawn up and then getting a detailed quote for the project is a huge amount of work. If that’s not done properly, you’re off to the worst kind of start. And, unless you’re Usain Bolt, you’re not going to end up with a good finish if you don’t have a good start. Even after the plans are drawn up, there are still so many things the builder needs to think about and account for. Let’s start before the job can… what is the access like? Can you easily dump the materials in the right spot or do you have to carry them, brick by brick, through the front door and out the back door through the kitchen? Time is money. What kind of spec are you looking for? What kind of materials? Each bit needs to be looked at carefully. A kitchen tap can be £50 or £200. Then you have the unknowns. These are the potential problems that a builder might run into but can’t predict up front… like digging the foundations and discovering an ancient burial ground that unleashes a poltergeist. Hey, it happens! What about structural problems with the house that were unforeseen? Asbestos? A nasty wasp nest that sends the builders screaming down the road and afraid to come back? You get the idea. Building is a risky business and you never know what’s around the corner. Careful preparation pays off, but it takes time. If you tell a builder that you’re not 100% sure if you’re going to do the project or which builder you’re going to use if you do, but that you want a free quote to help you decide, then you should not be surprised if the builder does not want to spend the necessary time preparing a good, well thought out quote. Working for free is not a good way to stay in business, so inevitably you will get a ‘guesstimate’, which is worse than useless. Why so, you ask? Well, if the guess is too high and you hire the builder, you’ve paid too much. If it’s too low, you’ll pay for it later. We hear stories all the time where homeowners get ‘quotes’ ranging from £25,000 to £60,000 for an extension. This happens no matter where you find your builders and it’s simply because builders can’t justify the time spent to prepare a proper quote for free. Getting a bad quote is bad for the client whether it’s too high OR too low. You are buying a service from a builder, which needs to be delivered over a long time period and they operate on tight margins. If a quote is significantly too low, the builder is likely to run out of money and won’t be able to afford to continue paying subcontractors and buying materials. It’s not just a case of turning up to work for nothing, it’s a case of not being able to pay the plasterer, electrician and plumber to finish the job. And the subcontractors definitely won’t work for free just to make sure you get your new kitchen or conservatory. If you get into this situation as a client, it’s really bad news. You either pay more or pay a lot more or the quality of the project is at risk. If you opt for giving your builder more money it could possibly end up costing more than the highest guesstimate you got. If you can’t pay then you’ve got an unfinished project. If you source another builder to finish the job it will probably cost even more time and money, since they have to schedule you in, get to grips with the project and figure out what is left to do. It’s not the sort of thing that builders relish doing, so it might even be hard to find a good builder who wants to take it on. So, quite obviously you want to avoid getting into that situation to begin with, at almost any cost. So, what is the cost of avoiding this outcome? For a couple of hundred quid, you can get a well-prepared, itemised quote, which will be refunded if you hire the builder. If you don’t hire the builder then you still have a proper quote to use as a benchmark for other builders. It’s money well spent and definitely one of the most sensible things you can do if you’re undertaking a complex building project.