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Labour Costs

By: Chris Hogan MSc - Updated: 22 Jun 2010 | comments*Discuss
 
Property Renovation Homes Price Houses

The price of people’s time is one of the major proportions of a renovation budget and explains why many people want to do a lot of the work themselves. But the nature of the housing market means that although the proportion allocated to labour has not risen as much as the price of houses over the past five to ten years. The fact that house prices have continued to rise means that margins can still be made so if you’re renovating for profit, the outlook can still be good as long as you pick the right project.

Labour Rates

If anything, the price of labour has come down slightly, because of the influx of migrant workers from the new entrants to the European Community enjoy. Many UK-based builders and tradesmen work to wage rates agreed by guilds and trade bodies and those rates have risen considerably. But this has been off-set by the arrival of Eastern European labour not bound by those agreements and the slowing down, in many regions, of the house price rise.

This situation also explains the rise of self-build project, because the prices of materials and labour have not risen at the same rate as the price of houses and land over the last five years. This means that although land is more expensive, those other two major costs are not, so people can build a house that will be worth a lot more than the cost of building it.

How to Get the Right Labour

What does this mean to someone renovating a property, either for their own use or to sell on at a profit? It means that there’s now a better chance of getting reliable tradesmen either by directly employing some of the new labour from Poland, Latvia and the like or because this competition has shaken up the UK building trade and made it pull it’s socks up.

There are three golden rules about hiring labour that apply to any area, from architects down to labourers. The first is to get at least three quotes or estimates for the work that needs to be done and compare them against each other. You may then be able to play them off against one another. Get a specification together so that you can be sure they’re all quoting for the same thing (see below).

The second rule, if possible, is to get those three candidates by personal recommendation. Talk to friends and neighbours who have had work done and how happy they were with the work. See if you can go and have a look at local examples of the candidate's work and talk to their customers. If they baulk at that then walk away.

Check Credentials

The third rule is to check people out with trade and crafts associations such as guilds. Don’t take their word for it that they are members, call and check them out. You could even try calling the local planning department and the trading standards authority. They may be able to recommend qualified people in a particular files, if you have a listed building to renovate, perhaps, or warn you that a particular person or firm is under investigation.

Once you’ve got your estimates, choose the person who you think will do the best job, and note that this doesn’t always mean the cheapest person. Check the quotes carefully against each other to make sure that they have quoted for exactly the same items and work. If you don’t do this, there’s a chance that you might pick the cheapest firm but then find yourself being charged more further down the line, because you didn’t notice that something you wanted done had been missed off the original estimate.

Then check their prices against other sources. There are a number of websites that will give prices per square metre for bricklaying, for example, or plastering. There are also books and trade directories, which you can either buy, or borrow from your local library. Search for ‘building price books’ on the internet to find some examples or check out the adverts in home renovation and self-build magazines.

Keep an Eye on Progress

Once you’ve chosen the right person and the project is underway it’s just as important to keep a close eye on the progress and make sure that the work will be brought in on time and under budget. See our articles on ‘Contractor’s Costs’ and ‘Budgeting and Cost Control’ for more help in doing this.

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