Why Aren’t Millennials Choosing New Construction?

While you might be tempted to assume millennials‘ financial difficulties are what’s keeping them out of the housing market, you’d be missing half the story if you did. Personal preferences are also among the reasons some millennials may not choose to buy a new construction.

new constructionHow Millennials‘ Housing Preferences Differ

Burdensome student debt and poor job prospects have forced many millennials to delay home buying. When they are ready to buy, however, they’re faced with a lack of starter homes that fit their budgets.

Unlike previous generations, who typically started families in their early- to mid-twenties, millennials are holding off until their late twenties. In addition, more young people are opting to avoid marriage altogether. For many, this is a personal choice, not merely a consequence of financial insecurity. These singles have little incentive to move out of their tiny rented apartments and into family homes of their own.

Location preference is also a factor. Many millennials favor urban areas, preferring easy access to amenities and short commutes over the spacious homes and big backyards of the suburbs. When you consider the regulatory costs and other expenses of urban building, you can see why most builders construct a few large buildings rather than many small starter homes.

Your Options as a Construction Professional

Ultimately, the biggest roadblock keeping millennials out of the housing market may be the lack of affordable homes in the sizes and locations they prefer. Even those who are ready to buy may not find a new construction that meets their needs. Recently, only around 20 percent of newly built homes were entry-level properties, down from 30 percent before 2008.

The demand doesn’t necessarily mean you’ll profit by building these homes, though. In fact, current trends suggest you’re better off not doing so. Older millennials are now starting to make the traditional move to the suburbs, just at a later age than previous generations. In addition, rising rent prices in urban areas are likely to make suburban home ownership increasingly appealing.

For more information on the new construction home market, contact the construction leads experts at Construction Monitor today.

Avoid Complications with These Documenting Tips for Contractors

Running any business, particularly a construction business, is difficult and complex. This complexity requires owners and managers to maintain clear, accurate, and thorough records.  Documentation of meetings, agreements, expenses, and other important factors can help keep the business running smoothly while also reducing disagreements and disputes. Here are some useful documenting tips for contractors.

Establish the habit of documenting all transactions, interactions, events, and other elements of your day-to-day business activities.  Although this sounds like it could become tedious and time-consuming, it will actually save time in the end by ensuring that important information is recorded and available when needed.

Proper documentation may include anything from making brief notes after a conversation with a project manager to executing complex contracts that are signed by all participants and stakeholders. You should also:

  • documenting tips for contractorsKeep notes covering discussions and meetings with clients, customers, suppliers, employees, and managers.
  • Maintain receipts, order forms, and other documents from suppliers and subcontractors.
  • Make detailed notes about all disputes or disagreements, changes to plans, or other interactions that could cause legal, financial, or procedural issues.
  • Record information about delays or other problems, the reasons for the delays, and what is being done to resolve them.

Remember, having a written contract is not just a matter of proper documentation: a contract, when properly executed and signed by all affected parties, provides critical legal and financial protection for all parties involved. Have a qualified attorney prepare the contract and ensure that the client’s attorneys, managers, and owners review it. Contracts should set out details such as project milestones, due dates, financial information and responsibilities and expectations from both sides. Have the contract signed by the proper representatives on both sides. Customer and contractor should address any later additions or changes in an addendum that is also reviewed and signed.

Construction Monitor helps today’s construction professionals take charge of their business with important information such as data on housing starts and reportage on the latest best practices in the industry. Contact us today for more documenting tips for contractors and suggestions for maintaining your important records.

Pitfalls to Avoid When Hiring Subcontractors

The skill and reliability of your subcontractors can make the difference between a profitable, trouble-free job and a major headache. By knowing how to hire good subcontractors, you can ensure you get more of the former.

How to Hire Good SubcontractorsSpotting Quality Subcontractors

Don’t rely on internet searches to find subcontractors. While that may be the fastest way to find specific types of tradespeople in your area, websites tell you little about what it’s like to work with those individuals.

Instead, tap into the construction community for references. If you need a drywall installer or a plumber, ask drywall suppliers and plumbing wholesalers if they can recommend someone. If you see construction work or renovations underway, introduce yourself to the person in charge to find out who’s doing the work and how it’s going. It’s also worth contacting your former clients to find out if they can recommend subcontractors.

Aim to collect at least three names for each trade to encourage competitive bids, and avoid depending on one subcontractor who may not always be available. Establish a pre-qualification process to speed up hiring for future projects.

Controlling Your Costs

Before you invite bids, develop a clear scope of work. This helps you avoid receiving widely divergent bids. Even so, never assume the bids you receive cover the same scope. Read each bid carefully so you know exactly what the subcontractor is offering. For instance, one bid might be cheaper than others because it doesn’t include the cost of clean up.

Low bids can be tempting, but realizing when something sounds too good to be true is an important part of knowing how to hire good subcontractors. Some subcontractors keep their bids low by cutting corners and using low-quality material, while others bid low, but find ways to raise the price later.

Be wary of subcontractors who expect a large deposit. Anything more than 10 percent upfront is worth questioning. Also, avoid those who won’t provide everything, including guarantees and payment schedules, in writing.

For more tips on how to hire good subcontractors, contact Construction Monitor.

4 Tips for Protecting Your Construction Lien

Construction liens, sometimes called mechanics liens, are important legal protections that ensure a construction company is paid for the work it performs. Dealing with construction liens can be complex, with variations in each state. In most cases, they should be handled by your company’s attorney. Here are four tips for protecting your constriction lien and ensuring that your financial interests in a construction project are protected.

dealing with construction liens1. Verify Property Ownership

Make sure to verify the owners of the property where the construction project is to take place. A good place to start is in the county’s public records department. Look for a deed that identifies the owners and clearly describes the property where you expect to be working. Double-check the contract you executed for the construction work to make sure the person you contracted with is truly the owner of the property.

2. File Appropriate Documents

File all the necessary documents for the lien, including all preliminary documents and other material required by state and local authorities. Skipping this step or missing one of these critical documents can deprive you of the protections you’re seeking and could have legal repercussions later in the process.

3. Maintain Timely Communication and Responses

When a response document is required, such as lists of suppliers and subcontractors, ensure that the response is delivered within the timeframe specified by the contract, agreement, or regulation. If the owners or other stakeholders have questions or want to contact you, get back with them as quickly as possible, or ensure that your attorney responds in a timely manner.

4. Close out the Project Properly

When construction is completed, take all the necessary actions to close out the project. This can include final agreements, inspections, indicators of satisfactory performance, and related legal documents.

Construction Monitor is a leading source for advice and industry insight to help construction companies succeed with their business. Contact us today for more information on dealing with construction liens and for suggestions on other important business protections.

Top Tips for Preventing Construction Site Theft

Preventing construction site theft will not only save you thousands of dollars, but also protect you from delays caused by missing materials and equipment, and the hassle of replacing your losses. The most effective theft-prevention methods are some of the simplest.

preventing construction site theftKnow that everything is a potential target – Copper pipes and lumber aren’t the only items thieves are eyeing. Don’t assume something won’t be stolen just because it isn’t highly valuable or it’s difficult to move. Securing not only power tools and heavy equipment, but also tile, cables and other less expensive material goes a long way toward preventing construction site theft.

Light the premises well – Your after-hours lighting should cast even illumination over the whole area, leaving no shadows for thieves to hide in. To save energy, use low-wattage lighting connected to motion sensors. Even a soft glow draws attention to suspicious activity and a light that suddenly turns on is often enough to scare away a would-be thief.

Have material delivered just in time – The sight of valuable material lying around your construction zone attracts attention from those looking for something to steal. The longer you store those materials on site, the more time thieves have to make off with them. Schedule materials to be delivered as needed and keep detailed inventory records so you notice if something goes missing.

Lock up everything – Place materials and tools in heavy-duty sheds secured with a combination of a mortise lock and a high-security hasp with a strong padlock. A simple padlock alone offers little security. Use wheel locks or immobilizers on movable equipment to make it harder to drive them away unauthorized. Secure the site’s perimeter with fencing, high-quality locks and alarms.

Get to know the neighbors – Introduce yourself to neighboring home and business owners and take time for the occasional chat. The better your rapport with them, the more likely they are to look out for your property and alert authorities when necessary. Being neighborly also cuts down on noise and dust complaints.

For more experienced-based tips on preventing construction site theft, contact us at Construction Monitor.

The Rise of Drones on Construction Sites

Remote control flying drones have taken on an additional role in construction in recent years. Drone use in construction has the potential to improve the performance of construction teams and boost overall profitability and efficiency, notes reporter Will Knight in an article on the website of the MIT Technology Review. Even so, drone use in construction also has a controversial side that could lead to objections by workers.

drone use in constructionDrone Use in Construction: The Positives

The types of drones used in construction projects are usually the smaller, boxy drones with three or more propellers. These drones can be flown vertically or horizontally and controlled with considerable precision by a remote operator. The positives that these drones bring to construction sites include:

  • Better project management: Drones can fly over a construction site and take multiple pictures and videos that can then be converted to a three-dimensional picture of the site. This image can be compared to drawings, plans, and expectations to ensure progress is on time, or to identify areas where troubles might occur.
  • Improved efficiency: Drones can be used to monitor the progress of a construction project as well as the day-to-day activities of the workers on the site. With a drone, managers can see how well and effectively employees are working and if there are areas where bottlenecks occur or where efficiency can be improved.
  • Increased safety: Drone video footage can help managers identify safety violations or areas where safety may be a concern.

Drone Use in Construction: The Negatives

Some believe that using drones to monitor construction activities is an invasion of privacy, or at the very least, the imposition of an unacceptable level of surveillance on employees and construction teams. Drone surveillance could be used in an intimidating way to urge employees to work more hours.

Construction Monitor provides industry professionals, managers, and owners with information that helps expand businesses, including coverage of the latest developments in construction technology. Contact us today for more information on the development of drone use in construction and how drones can help you maintain a more efficient and better-organized building project.

New Report: 2016 Construction Continues to Grow

In the last several years, US construction industry growth rates have shown a general upward trend. Thanks in part to overall economic growth, this year is shaping up to bring more of the same favorable environment for your firm.

More Residential Building

US construction industry growth ratesAccording to data from Dodge Data & Analytics, U.S. construction is set to see a gain of 6 percent over the course of the year. Certain segments of the industry are especially likely to benefit. The market for single-family homes is one of these. With mortgages easier to obtain and would-be home buyers gaining confidence, the amount spent on single-family homes is predicted to increase by 20 percent. Investments in home renovations, particularly of luxury homes, will further add to the gains you’ll see in this area.

Multifamily housing has been a booming market recently, and while growth in that market is likely to slow down some, the market will continue to advance. The expected 7 percent increase in spending on multifamily housing is still a positive even if it isn’t quite the abundance of the past few years when growth rates rose above 10 percent.

The overall trend is for the rate of expansion in the multifamily housing market to ease while growth in the single-family housing market picks up momentum.

Modest Growth in Commercial and Public Buildings

The commercial building segment is also expected to improve. Technology and finance firms are flourishing in today’s economy, and many are seeking room to expand. Their demand for office space is a large part of what’s fueling an anticipated 11 percent increase in commercial building.

In the institutional building segment, Dodge Data & Analytics figures predict a spending increase of 9 percent. Much of this comes from the increased demand for K-12 schools brought on by a recent improvement in financing options for these facilities.

Public works, on the other hand, aren’t fairing so well, and little growth will be seen in the coming year outside of environmental public works, such as water treatment facilities.

To find out about US construction industry growth rates in more detail, contact Construction Monitor.

Leveling the Bidding Competition

Your skill at bidding on a construction project is a major factor in ensuring your firm’s success. There’s no need to overcomplicate the process, though. Sometimes a few minor improvements in your technique are all it takes to outmaneuver your competition.

bidding on a construction projectCover the Basics

It may seem obvious, but before you create your bid, thoroughly review the project requirements and make sure you can meet them. Avoid the temptation to take a scattershot approach by bidding on everything you can. Bidding on a construction project you’re not a good fit for only wastes your time and resources.

If the general contractor requires a prequalification form, you’ll need to submit one to even be considered. Show you’re serious about the work by filling out the prequal form with complete and accurate information, and include all requested supporting documentation.

Review the latest version of the project plans, along with the most recent addenda. Skip this step and you could end up submitting a proposal that fails to address a critical point. When you create your proposal, state what plans you based it on and note the approval dates of any addenda.

Put in a Little Extra Effort

Submit your bid to all the GCs involved, not just the one you usually work with. By limiting yourself to one, you’ll lose out if your favorite GC doesn’t win.

Sitting around waiting to hear back on a bid is not only frustrating, it’s often counterproductive. Instead of waiting, check up on your bid in a friendly, professional manner. GCs have a lot going on, so your check-ins keep you on the radar and help you stand out from your competition.

When you’re offered work, take the time to protect your own interests by thoroughly reading every contract involved before you sign it. Signing off on something you assume is a routine formality could lead you into some expensive, time-consuming trouble if the contract contains unexpected requirements you weren’t prepared to meet.

For more tips on bidding on a construction project, contact Construction Monitor today.

Improving Communication Between GCs and Subcontractors

The success of construction contractors in Cedar City depends heavily on our local partners, especially subcontractors. To do their jobs well, subcontractors need an open and reliable line of communication with the GC. There are many ways to foster productive communication like this.

construction contractors in Cedar CityGet Off to a Good Start

Create a cheat sheet for your subcontractors to follow when submitting a bid. Outline everything you want to see in the scope sheet that will come with the subcontractor’s bid. This should include the subcontractor’s name and contact information, bond rate, base and alternate bid amounts, and divisions or specifications.

Carefully review each scope sheet before you delve into the rest of the documents. Subcontractor proposals are based on their own interpretations of what work is included and what isn’t, so there’s a risk of comparing apples to oranges. One bid may be cheaper only because it excludes so much.

Hold a pre-construction conference with everyone involved in the project, including the owner, architects, and all subcontractors. Make sure everyone understands the design intent, and is clear on the budget, scheduling, and their individual responsibilities.

During the Project

Successful construction contractors in Cedar City are those who ensure a constant flow of updates among employees and partners in management positions who, in turn, inform their subordinates.

Nip developing issues in the bud by addressing them head-on as soon as they appear. Drawn-out email exchanges waste time and short text messages can cause confusion, making problems even worse. Impersonal exchanges are also more likely to turn into a battle of wills. A phone call or quick in-person meeting will usually resolve the problem more efficiently.

Maintain transparency. It may be tempting to conceal cash-flow problems, but if you’re not paying your subcontractors on time, they’re likely to assume the worst. If things aren’t going as planned, sit down with your subcontractors, explain the situation, and offer a solution. Your show of good will sets the foundation for a win-win compromise.

For more tips on how construction contractors in Cedar City can succeed, contact us at Construction Monitor.

Pros & Cons of Using a BIM Model for your Next Project

Building information modeling, or BIM, is an effective technique for conceiving, planning, and designing structures of any size and complexity. As you decide whether a BIM system is right for you and how BIM and general construction go together, keep in mind the following pros and cons of BIM modeling.

BIM and general constructionAdvantages of BIM

  • Better planning and design: Using BIM, you can visualize a completed building and all its components and systems before the first shovelful of dirt is moved on the construction site. This information allows better planning and design that takes best advantage of available space and resources.
  • Fewer reworks: BIM allows you to see potential problem areas and fix them before the error is committed in the physical world. This reduces the need for costly rework and revision.
  • Savings on materials: BIM systems track and monitor resources and provide detailed information on needs even before construction begins. You are less likely to order more than needed and can replenish supplies only when necessary.
  • Support for prefabrication: BIM allows you and your partners to more easily prefabricate components of the project offsite, which saves time and money.

Disadvantages of BIM

  • Incompatibility with partners: BIM is not yet universally used among construction professionals. There is always the possibility that one of your partners or subcontractors may not use BIM and may not be able to use your models.
  • Legal issues: The legal ramifications of using BIM software have not yet been extensively tested, let alone settled.
  • Cost of software: BIM software requires a substantial investment in new technology. The advantages usually make the investment worthwhile, but only if the software is used to its full capacity.
  • Lack of experts: The relative newness of BIM means that there are limited numbers of experts working in the field. Your software purchase may require an additional investment in training and education.

Construction Monitor helps companies in the industry stay informed about how new technology will affect all phases of the construction process. Contact us today for more information on how BIM and general construction will continue to be a valuable and effective combination.