If you get a general contractor, make sure he/she is licensed, bonded and insured. Get lien releases and proof that all materials are paid for before they come on the property. When we built and remodeled, we also put time limits on the work as many contractors and subs take on more than they can handle. I am not familiar with construction management. You can also go to your local city/county building dept, they cannot tell you what contractor to use, but can tell you if there are any major complaints. Oh, yes, make sure that either you or your contractor gets the permits needed. And they are posted, if required on the job site. You should keep copies or actual paid receipts. DO NOt pay up front, pay 1/3, 1/3 and after final inspection and you are completely satisfied the final 1/3. Not sure about guarantees, depends on what you have done. Most of this information is based on Los Angeles County Building as my DH worked for Public Works and we built our own house, but he acted as prime contractor. Hope this helps a bit.
Good luck

I think you're confused about the terminology. Cost plus (or time and materials) and hard bid are two different job pricing and contract vehicles. There are different flavors of the former, but the idea is that the job costs what it costs, and you pay for it. The argument against is that there isn't much incentive for the GC to control costs, but there are ways you could write incentives to do just that into the contract (consult a lawyer with construction experience for that). The latter puts the onus for cost on the contractor- his profit is the difference between what it takes to do the job and what you pay. It also can create an adversarial relationship, where the contractor works to find changes that you'll pay extra for, as these can be a source of profit.

You're going to need construction management in either case- that's the function that makes sure that the concepts and requirements in your architect's design package are built as specified and in a quality fashion. If you're expecting the local AHJ (agency having jurisdiction) to ensure that the quality is there, please don't.

Often, folks use their architect as the construction manager. But then some architects are better at arranging space and detailing the finishes than they are at the nuts, bolts, and guts of the construction. I've also heard of hiring an experienced general contractor, maybe someone who's retired or otherwise has time, as the construction manager. This can also create conflict in the event that this individual disagrees with the architect or finds errors in the design package.

In any case, it's your money, so you should be on top of what's going on and not handing off responsibility completely to someone else. Good luck.

A Time and Materials contract is usually limited to small contracts where no subcontractors are involved since the payments to the contractor are for the actual cost of materials plus the time of the workers times an agreed upon hourly rate.

A Cost of the Work Plus a Fee contract is used for larger projects like a house where the General Contractor is paid the actual cost of the materials/rentals plus the cost of his own forces and the costs submitted by the subcontractors (where the mark-up is not revealed).

Cost control is often achieved by allowing the Owner to be involved in the subcontractor selection process but this obviously requires a fairly sophisticated contractor and owner (or an owner representative).

Individual General Contractors should be asked for the labor mark-up on their own on-site staff (excluding home office staff) and for the basis of their proposed "Fee" (usually a lump sum or a percentage of the total construction cost).

If a Construction Manager is used it must be determined whether or not he/she is at risk for the project cost and if he/she is responsible for the job site. The term Construction Manager is used for so many arrangements it is difficult to say much more about it.

A Cost of the Work contract can have a Guaranteed Maximum Price (GMP) which puts the project cost risk onto the GC and to balance that situation a Shared Savings can be included. Such contracts require a contractor/manager with more management skill that the average home builder.

Thank you all for the replies, and the clarification on the terminology. Just to give more detail the project we are undertaking will be a pretty sizable one with 1000 sq ft two story addition, and renovation of another 500 sq ft.

To clarify my original post then using the correct terminology we are definitely going to have a general contractor but we are debating between "A Cost of Work Plus a Fee" contract or a hard bid. We haven't yet reached out to general contractors yet but will be doing so shortly.

Our architect is really design only, he doesn't get involved in the construction end of things other then to ensure that the plans are being followed. He would not be able to manage/schedule the construction, and my wife and I do not have the skill set or time to take it on as a full time project.

I do like several aspects of the "Cost of Work plus a Fee" contract as I feel that a fixed bid can incentivize cutting corners to maximize profit and can also incentivize building in extra profit as a GC doesn't know exactly what they are going to run into at construction. However, I do like for the fixed fee that there is a balance with the competitive bidding process where you know you aren't severely overpaying. I guess where I struggle is identifying the quality/cost balance of each general contractor and the subs they use without a fixed bid. I will know the relative quality they provide by checking references and looking at past work, but I won't know their relative costs. I guess as macv pointed out you make up for that in the sub-contractor selection process and understanding all of the mark ups for the general contractor besides their overall fee. And as Thull and macv mentioned there are ways of structuring contracts to incentivize cost savings.

Thank you all.

Here's something I wish I had done before hiring a builder: talked to the previous WOMEN customers. Since my husband knows most of the male halves of the references we were provided, I left it up to him to make the inquiries. I still might have hired him, but at least I would have known more what to expect...

V

Since my husband knows most of the male halves of the references we were provided, I left it up to him to make the inquiries. I still might have hired him, but at least I would have known more what to expect.

Usually, we expected to be married to the woman, but whatever works for you . . . . . . .

Huh? I just meant I would have known the builder was a male chauvinist pig that had rather call my husband and tell Wes to ask me a question than call me directly. Among other issues I've had related to the fact that I *am* a woman. If I had talked to any of the women, I could have found this out ahead of time.

It was a joke, nothing more. Your phrasing made it sound like you "hired" your husband.

Ok, sorry. I'm a little stressed out and cranky right now. :-P

I understand that. We've been in for months, and I'm still finding stuff that I have to deal with because the builder or a sub screwed up. Mostly, the subs.

Today, I found a roof runoff drain pipe was left too short. They just buried the end under the grade, instead of running it all the way to the woods, a few feet away. A torrential downpour revealed the problem when one of the rain gutters overflowed.

It's like it never ends.

I know exactly what you mean, unfortunately. My latest is the garage door guy came this morning to install the door and discovered that the opening was the wrong height. That's what I get for assuming that the builder made it the height I asked for instead of "what we always do". We checked the width, but not the height--kind of dumb on our part, I guess.

Yesterday, it was the phone call from the countertop guy telling me that he wasn't coming yesterday like he promised and it would be friday or monday. After much pleading on my part, he moved it to friday or saturday. We were supposed to be DONE this friday, but now it will be monday because the plumber has to come plumb the kitchen sink and pot-filler. Our closing deadline is September 2. Ugh.

V