Remodeling Tips:  10 Essentials for Second Home Owners Greg Lowitz 

You own a second home that’s ripe for remodeling. Most remodeling projects present challenges; but remodeling a vacation home presents unique challenges that warrant special consideration. How do you budget? Who should you hire? How can you manage a project located hundreds, even thousands, of miles away? Follow these 10 essential remodeling tips to keep you in command.

1.  Do your research:  Prioritize your Needs     What’s your objective?  Do you need more space?  Or, do you want to update a few rooms.  Kitchen and bathroom makeovers are especially popular and are among the most expensive projects per square foot.  If your second home is in an upscale location, a new kitchen with hardwood floors, custom cabinets, gourmet appliances and granite counters could easily top $100,000.  Figure at least $20,000 or more per bathroom. 

2.  Hire a Competent Designer or Architect     The design process is creative, interactive and requires frequent communication.  You may be tempted to work with a local designer if your second home is in a remote location.  But this has significant risks and tradeoffs.  The advantage is that you can meet frequently with your designer and discuss aspects of your design.  The drawback is that the designer likely won’t have connections to builders, suppliers and building officials in the area.  Knowledge of local codes, ordinances and temperament of the planning department is key to efficient design and construction.    Furthermore, you would need to pay travel expenses to have the designer visit the property with you at various times during the project timeline.  Finally, if you hire an architect, be aware that he or she must be licensed in the state in which you plan to build and submit plans.  Given the considerable tradeoffs, you’re better off to hire a design firm that’s rooted in the vicinity of the remodeling venue. 

3.  Define your total Project Budget     Many second home owners are financially well off and pace project budget secondary to desire.  However, even if you’re financially independent, you didn’t achieve critical mass by squandering your hard-earned money.    For new construction of major remodeling, the following fees are handy “rules of thumb” as a percentage of the base construction costs:    Geotechnical engineering and surveying:  1 percent; Architectural design and engineering (structural and civil) 12-15 percent; Landscaping: 5-10 percent; General contractor markup: 15-20 percent; Construction contingency:10 percent; Other expenses include Owner furnishings (varies); Associated application and inspection fees (varies); City, school tax, utility connection fees:  1 percent; and Rental and utility fees:  1 percent.   Take note:  these additional costs add 45 to 60 percent or more to the base construction costs. 

4.  Design for Low Maintenance and Sustainability       When remodeling a second home, maintenance considerations are particularly important since you won’t always be present to prevent or repair problems.  At the same time, there’s growing interest in sustainable building materials that spare the environment and improve energy efficiency.  Trend-setting clients are asking for:  bamboo flooring; FSC wood materials; organic paints; engineered countertops; high-performance, low-maintenance windows; simulated wood exterior decking; tankless on-demand water heater; and photovoltaic solar panels.

5.  Get 3 bids        Getting multiple bids is smart planning and demonstrates you’re a savvy consumer.  Even if the prices are comparable, having multiple eyes look over your plans is a great way to identify unclear items or conflicts in the plans.  Sometimes contractors will also suggest ways to save cost without impacting the overall effect that you’re trying to achieve. 

6.  Do Reference Checks     When you find a contractor you like, ask for current references.  Check with the state contractor’s license board and verify that the license is in good standing with no unresolved complaints. Verify identify. Confirm that liability and workman’s compensation insurance is current and that any legally required performance bonds are in place.  If the contractor has trouble producing credible references, be guarded.  Also, check with the building department to see if they’ve had experience with the contractor.  Sometimes you’ll get some inside knowledge.

7.  Plan at Least 10 percent Contingency Fund     This is factored into the total project costs, but is often the first line item to chop when budgets get squeezed.  This is risky; things don’t always go as planned.  Remodeling is full of surprises and unexpected turns.  If you cut your contingency fund too tight, you’ll regret it.  And, if you don’t spend it, you’ll be thrilled. 

8.  Synchronize Payments with Work Completed     Some contractors front-load payment milestones, which puts you at a distinct disadvantage, especially if your builder is in another state or country.  Make sure payments reflect work performed and keep a 5-10 percent holdback for final completion of punch-list items.   Find out what laws govern down payments on construction contracts and insist that the contractor stick to them.  Some states, such as California, allow only 10 percent down or $1,000, whichever is LESS upon signing a contract.  Finally, be sure to get lien releases from all contractors before you make final payments, otherwise you could be held liable for unpaid bills from suppliers. 

9.  Hire an Experienced Project Manager     If you’re remote, you may not be able to monitor your project on a regular basis.  Often your architect will provide this service as part of your agreement.  Or, you might consider hiring an independent inspector/construction project manager as your proxy to monitor the progress and give you timely feedback. 

10.  Anticipate Issues and Stay Focused       Remodeling is a complex process that involves many disciplines and interactions between people of all walks of life.  Few projects go without a glitch from start to finish.   Educate yourself.  Expect the unexpected.  Anticipate issues and address them aggressively before they’re irreversible.  And if you’re ever feeling uneasy about anything, ask for a meeting between your architect, contractor and any suppliers.  After all, you’re the customer and this is your money.   Greg Lowitz holds a masters degree in engineering from Stanford University and is president and founder of Builders Websource (www.builderswebsource.com) a nationally recognized source of construction advice and structural projects for the building trade.