Featured – Second Suite

Choosing the right contractor to renovate your home does not need to be hard. If you take the time to follow the steps below you will be able to find a great contractor who can help you achieve your goals, and at a price that is reasonable.

But before we even get into that let’s quickly look at what a contractor does.

What does a contractor do?

The contractor meets with you to discuss your vision for a project, and then works to turn that vision into a reality. They do this by hiring the right labourers, pulling all of the permits that are needed, and organizing when each worker needs to go into the job site to make sure the work is happening as efficiently as possible. They ensure that the work is being done to a high standard and that there are not any mistakes that an untrained eye might miss.

Contractors usually make their money by charging between 10-20% of the total cost of the job (including supplies and labour). When you receive a quote from a contractor the mark-up will already be added in.

How to find contractors

The Internet

Kijiji, Craigs List, Angies List, and many other sites have pages for contractors to post ads saying that they are available for hire. Many of these pages show pictures of previous jobs that have been worked on, and you can get a basic understanding of the contractor.

There are a many great ways to find contractors, especially with the ease of the internet.

You can also google for contractors in your city and find the websites of contracting companies. Contracting companies usually charge a bit more for their work, and usually have multiple projects on the go, but they became bigger for a reason. You can be confident that when hiring a contracting company that work will be done to the quality that you want.

Referrals

This is my preferred way to find good contractors (and just workers in general). Talk to people that you know and trust about their experiences. If friends and family have not done this before, then your realtor will have suggestions that he can give.

In the last house that my wife and I built, the contractor that we ended up hiring was a referral from our home inspector (who was referred to us by our realtor).

How to select the right contractor

Get multiple quotes

This is the big one people. There is nothing more important in the entire process of finding the right contractor than this. When I was last looking for a contractor I was amazed at the variance between the cost, expertise, and quality of work between the multiple contractors that I connected with.

I would make sure that you get quotes from a minimum of 3 separate contractors. Doing this will help you learn more about them, and it may also give you other ideas on how a renovation can be done.

Ask your contractors for references from previous clients. Some questions that are worth asking are; “How close was his initial quote to the final price?”, “How accurate was the project timeline that was quoted?”, and “would you recommend this contractor to your friends?”

See if you can visit previous projects. At the very least, look at pictures of the jobs that your contractor has done.

Have they done a legal suite before?

Adding a legal suite to your home has increased regulations in comparison to building or renovating a regular home. Make sure that the contractor you are working with has worked on a legal suite, or make sure that you are well versed in the codes of your city.

Get to know the contractor

It seems kind of silly to say this, but it is really important that you like working with your contractor. You will be working alongside this person for the next few months and you will want to make sure that their working style matches your own.

How hands on do you plan on being during this project?

If you want as little involvement as possible then it is worth making sure that the person you work with is a competent informer, and is able to send you updates on the work that is being done. You need to be confident that this person is very details oriented and will hold his workers to a very high standard.

If you are a bit more like me, and enjoy visiting the site to see what is being done, and being a bit more hands on you should make sure that your contractor is ready to deal with that. Many contractors do not always enjoy having the homeowner drop by asking questions or pointing out issues (by the way, if you see issues, always point them out).

Nothing like surprise visits with the whole family

It is vital that you don’t just hire a good contractor, but that you hire a contractor that is good for you.

How many other jobs are they working on right now?

I have seen a project with a 3 month quotation turn into a 6 month reality because of contractors that are working on too many different jobs and can’t be organized enough to get them all done on time.

Ideally your project will be the only one that your contractor will be working on. The reality though is that something like a basement renovation is usually less lucrative than building an entire house, and some contractors will take on between 2-5 projects at a time.

If your contractor is taking on multiple projects, be sure that they are very organized, and look for some form of guarantee from them if they go over their quoted time.

Price isn’t everything

At the end of the day, the price is important, but not at the sacrifice of the quality of the work that is being done. The highest quote does not mean the highest quality, just like the lowest quote does not mean the work is shoddy.

Many contractors started working in a certain construction field and may be able to complete tasks on their own without hiring it out. This can save them money, and they pass those savings onto you.

Conclusion

The most important thing to take from this article is that getting multiple quotes is a must. Spend time getting to know the contractors that you are thinking you want to work with, and do your due diligence to make sure that they meet the standards that you have, and that you will survive (and maybe even enjoy) the next few months of working with them.

We hope that you have found this article helpful. As always, feel free to leave comments below, and please share this article with your friends.

One of the last decisions that many landlords of secondary suites decide on is how they should split utilities. But this is something worth thinking about before you’re about to post your suite online. Should you go 50/50? Or include it in the rent? These are great questions to ask, and there are many factors to consider. Let’s dig into what options you have, and what we recommend.

Should I Include Utilities In the Rent?

Including utilities in the rent can simplify payments between landlords and tenants. The way you would do this is think about how much rent you would like to get on a monthly basis, and then average what utilities cost over a year and add that to the price. Tenants like this because it creates consistency in how much they pay each month, and if your tenant is careful with how they use their power, then the landlord can potentially make a bit more on warmer months.

There are a few downsides to going down this route however. First, expect your utilities prices to go up, as tenants who are not responsible for how much power or water they consume will tend to use them all more freely.

Second, including utilities in the price makes your home look more expensive on renting sites. We have tried renting our properties both including utilities and separating them, and we found renters faster by not including utilities nearly every time. Rentals at lower prices on rental sites consistently get more views, which means there is more potential in finding a great renter.

Ultimately, we think that including utilities can be a good option if a landlord is looking for a simple way to charge their tenants. It does have the ability to eat into your profits and can make finding a tenant take longer. If you are willing to communicate with your tenants consistently, then there could be better options for you.

A Simple Way to Split Utilities

If you decide that you want to keep utilities separate from the rent then there are a few choices that you need to make.

Whose Name is on the Bill?

If you are living in one of the suites, then the answer to this is pretty simple. It will be under your name.

If you are renting both the upstairs and downstairs however, you can choose to have them still be in your name, or choose one of the tenants to have it in their name. If it is in the name of one of the tenants then it will be between both of the renters to work out how much they each need to pay, with money being transferred between the two parties. Alternatively you can keep the utilities in your name, and just let each tenant know how much they need to add to the rent they send you each month.

Although both options have their pros and cons, we would recommend keeping the utilities in your name. It is not too challenging to send a text at the end of the month saying how much utilities is owed and needs to be included in the rent. And instead of money exchanging hands through multiple people you are the main point on contact for a single transaction each month.

How Much Should Each Suite Pay?

You can ultimately split the utilities in whatever way you see fit. One of the ways that many consider to be most fair is to look at how much square footage each suite has, add them both together, and then divide the square footage of each suite to the total to get a percentage.

Basement (600sqf) + Main Floor (1200) = Total House (1800sqf)

Basement(600sqf)/Total House (1800sqf) = .3333 or 33%

In the example above you can see that with the calculation the basement should pay 33% or 1/3 of the utilities, and the upstairs should pay 2/3 of the utilities. When you do this in real life, you probably won’t get percentages that are quite as clean as above. We would still recommend choosing whatever is closest to a simple fraction, so 1/4, 1/3, or 1/2.

Pros and Cons

The benefits of going down this route is that as a landlord you are always getting the exact amount of rent that you excepted each month, and that the tenants are responsible for the utilities that they use. As mentioned in the utilities included section, you may also find that you can rent the suite faster as a lower cost properties on rental sites get viewed more.

The downside to this is that splitting utilities is never perfectly fair. The basement tenant may be paying less. but if he is always taking long showers, and likes to keep an electric blanket or heater on most of the day, then the upstairs tenants might be fronting a portion of what should be on his bill. It will be important that if you choose this option that you are able to foster open communication with your tenants and listen for their concerns and see what you can do to find solutions.

One Thing to Consider

While you are building your home, or legalizing it, you do have the option to contact your utilities company and have then instal a second electric and water metre. Going down this route can have a high upfront cost, but it could save you headaches in the future.

For this to happen the utilities companies would need to dig a ditch by the nearest outside wall to where your utilities room is located in your home. They would then drill a hole through the wall, install the second metre and connect it to the panels in your home. When we looked into doing this in our Nolan Hill home, we were told the cost would be between $5-10k all in. We ultimately decided that the return on investment would take too long to recoup, but it is an option that some may consider.

In Conclusion

There are many ways that you can deal with utilities for homes with secondary suites. If you are ok with potentially leaving money on the table then including utilities in the rent is easily the simplest option. Alternatively, charging for utilities outside of the rent is more accurate, and you get the same amount in rent each month, but there are a few more headaches to deal with.

Please let us know in the comments what your preferred method is, and subscribe to Second Suite to stay up to date with the best tips on legal secondary suites in Canada.

Category: Featured

Choosing the Right Contractor