T: 604.918.4281
Guest on Havan's New Podcast

Ask Matthew Senf

Matthew, principal owner of Sasen Homes is a “renaissance man”.   He loves building things such as motorcycles and enjoys riding them.  When he’s not in his office he can usually be found tinkering in his workshop building and creating beautiful projects for his family and home.  Matthew is an avid reader who studies theology and enjoys speaking in various settings as part of his volunteer work.

More recently, Matthew was asked to lend his expertise to a HAVAN (Homebuilders Association Vancouver) initiative to provide more informational content to the purchasing public on various elements integral to the building process (both renovation and custom home building) by way of a series of interview style blogs.  The concept was for Matthew to share his depth of experience in the fields of renovation and custom home building and specifically the process of complicated construction budgets.  The goal was to empower homeowners with a working knowledge of not only how much money is needed to complete a typical project but how that figure is calculated, deployed and accounted for during a typical construction phase.

LISTEN HERE

In the words of Matthew,  “Budget is one of the biggest stress points in the design/build process and the cure for that stress is knowledge”.    

Got a question?  Ask Matthew and our team at Sasen Homes.  We would love to help you with your building needs.  From renovations to home builds, we love what we build.   Reach us here.

Nailing down your budget with a proper scope of work will help keep your homebuilding budget on track. Matthew Senf of Sasen Homes suggests taking the time upfront to disclose your goals and budgets. 

LISTEN HERE @HAVANofficial 

FULL TRANSCRIPT OF PODCAST

Here’s the Full Transcript of this Episode

Jen:

Welcome to Measure Twice, Cut Once the podcast from HAVAN, the Homebuilders Association Vancouver from code to closets, safety to skylights.

Mike:

We’ll take you behind the walls and all things, home building and renovation, and give you the

Jen:

Ins and outs from the experts on what you should know in plain language about home building design and renovation. I’m Mike Friedman, and I’m Jennifer Lee. Now that you’re here, why not hit subscribe? And you’ll never miss an episode.

Mike:

And don’t forget to share with your family, friends or anyone else, you know, who might be thinking of a project in their home now, or in the future.

Jen:

We have Matt Senf from Sasen Homes and he is going to be talking about one of the scariest topics. And then of course his budget,

Mike:

If you don’t talk to Matt ahead of time, but if you talk to Matt, it won’t be scary. It shouldn’t be something that intimidates you. It should be something that helps both of you maintain your objectivity in the project because it’s really, really easy in any sort of project to go I’ll just add this and I’ll just add that, and all of a sudden you’re over budget. So he’s going to help with the planning. Planning is really, really, really, really, really, really important to successful results. And that way there’s no issues with budget and the budget stays where it’s supposed to stay and it doesn’t gravitate way bigger than it’s supposed to be.

Jen:

And just understanding the budget because sometimes when people give you a budget sheet, it can just look like a whole mess to you. You’re like, I don’t understand what this is. And so you want to be able to know, like, why am I paying for the extra coat of paint on that wall? You want to know all these things, because at the end of the day, the more you know about the nuts and bolts of your home, then you’re going to understand why it costs the way it costs and why it’s important to have those things in your home for longevity. I’m so excited to have somebody in the studio besides Mike and I, which I do enjoy your company, Mike, I just nice to have another person in here. We’ve got Matt Senf from Sasen homes. How are you today?

Matt:

I’m doing well. Thank you very much. It’s great to be here with you both. Hey Matt, thanks for joining us.

Jen:

Perfect. And for people that don’t know who you are, and this is kind of your time to shine can you let us know a bit about your company.

Matt:

Sure. Thanks. So Sasen Homes we used to be Sasen Design development Inc, but Sasen Homes is what we’ve been operating under for the last little while. We are a full-service residential renovator and custom builder. We operate mostly from New Westminster to West Vancouver. We have won I’m pleased to say pretty much every major award there is to win even HAVAN awards. Yeah, so we struck our company, uh, as a proprietorship in 04. So, from ’96 to now, really I was, I started as a labor on construction sites. It was still the 1900’s.

Jen:

You said you have other things behind you too. And I think that makes you a well-rounded contractor. Can you tell us a little bit about some of the things before you got into construction?

Matt:

I’m married, I’ve got two daughters. They’re teenagers. I have a 15 and a 14-year-old daughter, in these Covid days are pretty great kids, but I studied in political science and religious studies. And then I went on to do some graduate work. I got a Master’s in Divinity, which has no practical application in the world, except as a pastor having to be Lutheran in 2012, because I did mine part-time, obviously, because I was, uh, I was also doing my apprenticeship at the same time. Of course of study, I was ordained as a pastor in the Lutheran tradition. So right now I’m the interim pastor at Oak Ridge Lutheran Church.

Jen:

So could Mike and I go and like, watch you in action.

Matt:

And in fact, you don’t even have to come because the doors are shut in these Covid days, but you can tune into my weekly, reflections.

Jen:

Other things that I was reading about you that I wanted to ask you about that I already had the HAVAN members dig information on you. But it said that share an interesting fact about your life, and you said, I have climbed to the top of the great pyramid of Giza. I Googled that. Apparently, you can’t do that.

Matt:

You can’t, that was ah, you were fact-checking me.

Jen:

Yeah, I was, it says you could go to jail.

Matt:

And this was in 1989, tail end of high school. We went on a, on a school trip. It was amazing. We landed in Cairo, went to Aswan all the way down the Nile and then back up. And I did all kinds of world, wonder stuff. Stood in front of the Sphinx. I mean, it’s so depressing. It’s only it’s as big as this table.

Jen:

I heard Kentucky Fried Chicken is across the street from it.

Matt:

If you look, you’re absolutely right, if you stand on the pier, so in those days you could, we climbed up, but we climbed up with our tour guide Haladis. I still remember. It was amazing. And we looked this way and you thought like, Oh, I’m in, I’m in Last Indiana Jones, Last Crusade. Cause it was desert. And you know, you’d see a camel. And if you turn around and look that way, it was the full city of Cairo with yeah, like a Kentucky Fried Chicken.

Jen:

Let’s talk about your Netflix guilty pleasure because I just watched the movie of this the other day and I do like it.

Matt:

We’re spooling up to watch it again, Downton Abbey, my wife and I, I don’t, I think it’s just, I love it because it’s such really well-written character development. There is, you know, there’s nothing and, and quite dare I say sort of wholesome, right? I mean, there’s some racy bits. Ooh, but it’s not, nobody’s getting their head cut off or cars blowing up and whatnot. It’s really, it’s really great character development. And at a time in history, I was reading somewhere that at that point between the two Wars, something like 48% or 42% of all people in England were in service. Were working as a valet, as a butler, as a cook, as a stable boy, as a whatever. Can you imagine that? Maybe not for you. I don’t know it was an improbable percentage. And so it’s, it’s a window into a world that we don’t clearly have anymore.

Jen:

No, I, I, I love watching as well. And on a building note too, I just love taking, look at the architecture because it’s gorgeous.

Matt:

It is. It is. Yeah. That’s fascinating, there are a series about that, about what has happened to all these great manor homes and in England, but yeah, they’re, they’re disappearing by the second. Yeah.

Mike:

Oh great deal of gone by the wayside. They just don’t have the money to keep them. They’re just falling into disrepair, which is tragic. Now seems like an opportunity for some of our HAVAN builders to get together and write some of the wrongs of history.

Matt:

Let’s do it. Let’s do it. We’ve done. I mean, certainly not on the same scale, but we’ve done some, uh, some heritage work in places like Queens park and New West and so on. And I love that work

Jen:

That’s where I grew up with Queens Park. Yeah.

Matt:

So we did Thrushveil. It actually has a name, uh, but across from the armory,

Jen:

Like Sixth and Queens Avenue

Matt:

For a lovely family there, and that was 1899 that house was built in. And as we were taken off, the awful stucco that it had been smeared with in the, in the seventies, it was like an architectural or sorry, archeological dig. We were pulling out all these amazing hand-carved knee braces and all this stuff that had just been clapped up with chicken wire and you know, one by four and buried. So that was really, really, fun.

Jen:

Yeah. So, so many great aspects of course, to building. And one of them, when you’re wanting to build a home is, you know, the scary topic of budget, which not everyone likes to hear. And I always laugh when I watch TV shows on HGTV and they’re like, what’s your budget? And they’re like a hundred thousand dollars. And they’re like, I can work with that. And then all of a sudden they go back and they’re like, Oh, sorry, we ran into some asbestos that we didn’t even plan for. And so we’re going to need more money and then they get into a fight and then none of this gets put into writing and you’re just like, cringing is somebody on the other side. So, can you tell us what is the first step that somebody should understand about the world of budget? I’m making it some way more cool than it is.

Matt:

Yeah. Well first let me, can I say this an HGTV GRRR HGTV. Thanks. Thanks for the help. Don’t bother.

Mike:

What do you mean you can’t build an entire house in three days?

Matt:

You know, and for yeah. A hundred thousand dollars? Oddly enough. No.

Jen:

Sometimes the budget and I’m like, Oh,

Matt:

It’s super frustrating. I mean, you know, Hey, they’ve done a lot of great things in terms of up the level of education and, and people’s awareness of different technologies and, and maybe sort of the life of the contractor, but it’s TV. Right? And, and so there’s a lot, that’s you know, a standard by which we’re supposed to be operating here, that is fantastical dare I say. So, the very first thing about budget – disclose it. Tell your contractor not what you think it costs. That’s not your job, that’s their job. But tell them, hey, I have X amount of money to invest in this thing. And ideally, like before you go and buy a car or go and buy a watch or go and buy whatever you have a sense in your mind of, well, I want a Volkswagen or I want a McLaren and then expect to pay for what you’re going to get. But disclosing it is the key thing. Especially if you’re, if you’re doing a design-build situation, like we are, how many times has it happened, where we have got, you know, drawings, can you quote these? And so we meet the clients a little bit, we’d take their drawings, we take them home and pour over them for two weeks and come back with this really well articulated detailed scope. And it’s going to be $837,000. Mr. Smith. And Mrs. Smith is on the ground and everybody’s time is wasted, right? Because we didn’t have an opportunity to say, what do you want to spend on your reno Mr. Smith and $400,000. Okay, well, we’ll just take these plans and throw them out. And let’s talk about what we realistically can do. Like we want a chance to after the design phase, because we’ve got quite a few phases after that for you to be happy and thrilled and, and engaged.

Mike:

Well the people you’re working with know relatively what these things cost. And I think that goes back to establishing that initial trust and building that relationship is saying, I have X dollars to spend. The right professional in this industry will say, we should be very close or they should be able to say, we cannot do it for that amount of money

Jen:

And setting expectations. I think it’s hard too, because we have so much, especially with social media, like back in the day, you would get like the new House and Home and like, be like, oh, maybe I want this or whatever, but now you can go Pinterest your HOUZZ. People are building their pages. They’re, they’re setting so much expectations for their selves. It’s not usually aligning with their budget. And they’re like, but I want that beautiful home that I taped to my Pinterest page. And so as a contractor, it’s hard because you don’t want to crush their dreams. You want to help them in a realistic way that’s going to satisfy them at the end.

Matt:

So if we were to percentage this out, right, let’s say 75% of people, they want a beautiful bathroom, but they’re in that $30, let’s say to $30 to $40,000 a bathroom. Well, all these amazing bathrooms that they’re seeing pictures of on housing Pinterest, that’s not the $30,000 bathroom. That’s the $60, $80, a hundred thousand dollar bathroom. So exactly. There’s great things because people can see what they want and love it.

Jen:

How do you get them from their dream images that they collect from Pinterest, from HOUZZ and magazines? And how do you get them from there to their actual real budget?

Matt:

I think you want to, and somebody said earlier on the interview to manage expectations, right? It’s great first of all that they’ve done that. That they’ve collected images. They’ve ripped the page out of the magazine and they have something when you arrive so that you’re not trying to, you know, tell me what I like. So, if they’ve done that, that’s great that they’re on the right track. I think in terms of matching that to their budget, you need to have, you know, the manage expectation talk as quickly as possible. So first please disclose your budget to us. So we can say, this looks really good. This is very doable. This really is going to pressure that button maybe end up in disappointment. So, but I would say the key thing is I would hope from our clients that they would allow us the time to dig into things that are really complex, right?

Matt:

I mean, it, lots of moving parts, lots of options for finishes, lots of stuff going on. Give us the time to really dig into that. Right. It’s a major investment. Don’t ask me, what’s a ballpark figure. And I say a number and then 10 months later ‘but you said’ we have what we talked about something completely different, right? Let me get my trades in here. Let’s see what’s going on in this, especially in a rental situation what’s going on in this existing building, let’s have time to really explore this super complex thing.

Mike:

Matt, I’m a consumer, I’m a homeowner. I’m looking to do some work in my house. You’ve made it very clear. We have to start with a budget, but sometimes that budgets an arbitrary number based on what I can get a loan for, not necessarily reflective of what I can actually do. And we all know our good friends on television, maybe cloud the waters of reality, as far as what we can actually do and timelines and things like that. When it comes to setting up the initial planning stages, do you recommend, we start with a list of things we want to do and apply a budget to that, or do we start with a budget and then we shortlist what we can do within the context of that budget. So for the planning process for consumer, even before they talk to you, what’s the best way to get started that will create the most realistic reflection of what they want in a tangible budget after the fact.

Matt:

I mentioned that the conversation is even more high level than not to begin with. Why are we here? What do you need? What are you trying to achieve? Is it just that you want a nice sort of gourmet kitchen and, and fair enough, you know, this is how we’ll go about that. Is it that you’ve, you know, there is an addition to the family or are you going to do some intergenerational living? Mum’s moving in, we need a suite, this doesn’t flow right. You know, it never, we never liked whatever it is. Have that high-level conversation first. Oftentimes you know, the why will direct the where you’re going to push your, your, your finances.

Mike:

Is there a general rule of thumb for someone looking to establish a budget for their project? I mean, I can say a hundred thousand dollars because that’s the budget I have to spend, but that’s kind of arbitrary that doesn’t really speak to what I can do just to how I can do it. Do you have any guidelines, tips, or tricks so someone can start to think and fabricate some of these numbers in their own minds so that you both starting from relatively the same page?

Matt:

It’s tough because finishes, push a lot of it. Right. And everybody’s quite unique in that, but I would say this if I walk into somebody’s home and they say, so Matt, we want to work with you. We want to work with him because we’ve heard that you’re great and so on and so forth, give us some sense around how these things are going to pan out. So I would say, you know, your bathroom, like you certainly don’t go under $25K for a bathroom, a full gut. These are all full guts. And nobody really wants to do a partial bathroom, right? If we’re going to do the bathroom, that’s got the whole thing and do everything properly because, you know, it’s likely that technology in terms of membranes and in terms of energy, saving appliances or fixtures and whatnot are elevated so much that you want to look into that stuff. So let’s say, you know, $20 to $30 and beyond if per bathroom per three-piece bath. For a kitchen, say your average kitchen is again, starting at maybe $50K you know, with appliances and so on, dollar amounts per square foot, super difficult in reno, quite easy and in new construction, I think are certainly easier. But then again, that if you look across a company is that changes and this pushed in different places, depending on whether somebody wants to, you know, all kinds of passive host technology in their house or their, you know, appliance budget is, I mean, it’s, it’s really hard. You sort of have to build these things from the ground up.

Mike:

Let’s take a couple minutes and have a brief break. We’d like to say a huge thanks to our industry partners and our sponsor FortisBC for all they’ve done to help us bring this podcast to life.

Jen:

Thank you for supporting us with this podcast Measure twice, Cut Once to benefit homeowners and help them make the right building decisions the first time. And review us and please follow us. We are a brand new podcast and we would love it if you shared it with your family and friends and by following us and reviewing us, you could win a chance to have a beautiful barbecue from FortisBC.

Mike:

Barbecue. Oh, I love barbecue. I really love Napoleon Barbeques. This is a Napoleon Barbeque. So it’s a premium cooking device. You can do some amazing things on it. Now I don’t know about you, but I’d love to win it. And I’d probably use it to make some ribs for us. That’d be my first cook, you know.

Jen:

Ok Mike, we got to get back to talking about budgets, but we got the point.

Mike:

You can win a barbecue and make ribs.

Jen:

Awesome. Okay. Let’s get back to budgets. Yeah. And going into the next thing is there are two most common types of budget they’re usually used. I know we tend to use cost-plus a lot. And, um, but a lot of people use fixed price as well. And right now a lot of people are probably wondering, what does that mean? It took me a while to understand both. And I know they’re hard to kind of make a Coles note version of each one and there’s so many things to do with them, but can you tell us a little bit about the difference between them?

Matt:

Cost-plus is fairly, fairly straight ahead. You get effectively every dollar that’s spent, it’s disclosed to you. So the transparency, people like that. And there’s a labor rate. You’re, you’re given a list of the labor rates for carpenter and apprentice or designer, and what have you and the builder discloses a management fee or one that’s going to be 10 or 12 or 15 or whatever percent it’s going to be. And then everything you’re making budget decisions, as it goes. With that model, just like with stipulated price, you get a budget, you see the spreadsheet, you know, it’s calculated quite precisely before you start or should be for goodness sake. On fixed price. I’ll say this, there is no such thing as fixed price. It’s stipulated price. So you get an exhaustive list of, this is what we’re going to do, and this is what it’s going to cost. And here are the things which require budgets because they’re just so. And here are the elements that we’re unsure of and the boxes we have to check or what you will provide or, or whatnot. Personally, I like stipulated price because if I’m going to spend a quarter-million dollars on a reno, boy oh boy, I want to know, you know, where that number is going to land. Again, you still get the budget in cost-plus scenario, but there is, um, much more leeway for that to move in a stipulated price scenario you’re getting a guaranteed price from your builder. This is what all of this will cost this.

Jen:

There’s so much information that people can find on it as well. Like if you want to read up more on these, I know that you can go to the Canadian Construction Documents Committee as well, because these are things people need to know because you know, the contractor could be like, I work on a fixed price or a cost-plus basis. And the client could be like, okay, I have no clue what it is, and then they don’t think about it. And then when you show them the budget, they’re like, whaat, I don’t get it.

Matt:

You know, most of the builders that I know can do both, there’s a familiarity with. There are some types of things that, that lend themselves specifically to cost-plus. If you showed up at a place and it’s a there’s rot, right. They know that there’s some rot in the mall. Well, how do you fix price or stipulate price cost that? You don’t. So, you know, because you’re going to take those walls apart and you’re going to get into things and it’s an exploration more than anything else. So there are things that, you know, particular types of construction that lend themselves to one model or another.

Mike:

And I think in both of those scenarios, even the very best person can’t predict what’s behind those walls when they open them up, we call that the X factor. And sometimes you find things in there and all of a sudden you have to change some of the things you thought were going to happen. So let’s assume I’m working on a project with you for a hundred thousand dollars. I should I plan on having that money for you all upfront? Or how should I plan on working with you in terms of the payment timing, the flow, the cadence, how does that all work?

Matt:

Yeah. So all kinds of people do it all kinds of different ways. We like, again, in the, in the stipulated situation, it’s quite easy because there’s typically a schedule, right? So there’ll be a deposit on sign the contract. There’ll be something on, on start date when you’re pushing out to buy lots of material and so on and get things ready. And then it just goes on a, on what we call a percentage completion schedule. So you’ll pay 5% at demo in 3% at plumbing, rough in and 6% at a drywall and so on and so forth. And over the years that I’ve seen many different things, some folks have it relating to time. And some folks haven’t related to, you know, other different things, how, how folks are getting this financed right based on, which I suppose is as a percentage completion after a, after a fashion. But the key is to be given some sort of plan so that you can organize your money that way. And then in the percentage completion that the contractors never really further out in front of the client, then everything that’s there or the material that’s there, or tasks that are complete, you see what you’re paying for it’s onsite. And the time, you know, folks who organize it on a time factor. Well, what happens if uncontrollable things happen? A pandemic, it comes up or whatever you’re delayed in inspection, or what have you. And all of a sudden, you know, weeks are tripping by and you’re putting out this cash and nothing’s happening on the job, right? Produces anxiety and anxiety erodes relationship. And the process just really breaks down.

Jen:

I think going back to that open relationship with your contractor and the more that you guys can have an open relationship and communicate building process is going to be a lot easier on the both of you.

Matt:

It so is and you know, when I first started in this, I thought that sounded a little cheesy to me. Hey, it’s all about relationship. It sounded very salesy, cheesy. I am a hundred percent convinced that is everything it is about. How are you going to communicate with somebody you don’t like that you don’t have a relationship of trust with and whatnot. Are you going to do a reno without a constant communication?

Mike:

Well, you definitely need both, but I think the other thing that you need, even if you have the best contractor in the world and you have a great relationship and everyone is very clear and forthright at what they want, you still need a piece of paper to protect everyone in the equation as well. And getting it writing is probably one of the most important parts of the planning process before anything starts to happen. Can you talk about that from both the builder’s perspective and also from my perspective as a, as a homeowner as well, how it will protect me.

Matt:

These are big, complicated endeavors, right? So structure that. It’s crazy to put this kind of money. I think I, while preparing for this, I wrote about, you know, you’re going to get a phone plan. It’s 10 pages deep this contract, and what’s a phone plan a couple of hundred bucks a month, and you’re going to spend hundreds, tens, certainly or hundreds of thousand dollars on the biggest investment that you have. And you’re going to do that on a handshake. I mean a good contract. And I think you mentioned the CCDC earlier on, and it’s not like there are not the bones of these types of things out there to be, to be taken, but any, any professional company will have had that in place for a long time. They will have tested it through multiple projects. They will have had legal look at it and exactly to protect and not only themselves, but the clients.

Jen:

So talk about changes for a second because you know, me as a homeowner starts working with you as a contractor, I get excited because I see everything happening. And then I want more changes as we get into the process. How does that change orders work? And because people are like, what is that? And, um, how can you make sure that they don’t turn out to be giving you a heart attack if all of a sudden there’s like a whole bunch of money you did not not account for.

Matt:

Yeah. Yeah. And feeding back into the conversation of getting it in writing, how do you even know what’s on or off the table? If you don’t have a really articulated scope? I mean, these are complex things. A bathroom is one thing, but if you’re building a new house or you’re adding a top floor to a house – super complex, right, our scopes are six and seven pages deep. So, the first thing is don’t change the plan until you have another one in place. And that’s the key thing. And that plan will be the scope. If you’re going to move off of that scope, your, your builder should have a process by which, okay, what do you want, what would you like done? Let’s articulate that. Let’s cost it. Let’s say how many more days that’s going to add to the schedule. And would you like to do this Mr. Smith or not? I keep I’m using Mr. Smith, Mrs. Smith, would you like to do this or not? Um, uh, and, and then, and then track that both the affirmative, both the acceptance of it, or the rejection of it,

Mike:

You brought up an important topic and that is sometimes not everybody’s on the same page at the end because things change really, really quickly. Sometimes they change on the fly and let’s face it, we’re human beings. We don’t always remember everything. Because we’ve smartly got it in writing and we’ve detailed the payment process, are there any recourses, if the builder and the homeowner are not on the same page, if there’s some incongruencies, how would they handle that? And, and how could getting it in writing protect both parties should that come to pass?

Matt:

I guess if you don’t, then it’s infinitely harder. If there’s not a scope to, uh, to refer to. Again, these things are complex, right? We often, the client will say, um, Serita, we’ll write up a change order, an extra work order, and it’ll be, oh, no, actually referring into the back end of the scope here. no, we did say we would supply a, a lit medicine cabinet or what have you, and then great problem solved and we go ahead and do it. So even we are referring to these complex things that we, uh, that we’re building for guidance in terms of whose responsibility is it. Recourse in the absence of that? Well, then it’s just, well, I said, but you said, and, and again, these things are occurring over nine months, 10 months, some of these big projects, a year. I don’t know what I said 18 months ago or eight months ago. I need that to be documented, to know my responsibility and, and for the client to know theirs for that matter.

Mike:

And is it safe to say that if I don’t have it in writing my legal recourse as a homeowner is diminished significantly or just a lot?

Matt:

Yeah. Well, I mean, the courts, you know, the courts, I think are sensitive to people spending this kind of money in particular on their home. It’s not a, you know, I bought a McLaren and I didn’t know what I was doing. Like this is where we live, where our kids are. So I think the courts are definitely oftentimes on the side of homeowners who have been obviously sort of built. Yeah. Having a proper contract, having a well articulated scope of what is going to be done and not done is, is, uh, it makes it much easier and much more efficient anyway, and in court.

Jen:

And there’s another part to it that we didn’t talk about it because obviously, it’s not just the contractor that’s building the home. If it is, then it might be a little slow, but there’s so many different facets. There’s so many sub trades that are on it. So how do you know the suppliers and trades are getting paid and how do you work and how do you work out the budget with them?

Matt:

Yeah, yeah. So again, in the stipulated model, I mean, this is what you’re learning. This is what, when you’re interviewing your contractor, this is what you’re finding out, what are their relationships with, with their subs, with other clients. And so on, there are a number of ways in the CCDC legal contract here in, in Canada. Um, a 55 day lean hold back is, is typical for, for projects over a hundred thousand dollars. I’ll tell you from the point of view of a, uh, residential, uh, quote-unquote, smaller residential builder. So let’s say under 10 million. That can be, it’s an onerous admin piece for, for us and how it goes, essentially that for every invoice that let’s say it’s a hundred thousand dollars, a hundred thousand dollar project, or a $200,000 project, you’ll go to the bank, you’ll set up a joint account with you and the client. And then every time you invoice, you’re actually going to get two cheques back. You’re going to get one for 90% and one for 10% that will go into that joint account. And that’s held back against deficiencies at the end. It’s a good system, but it involves a lot of, I mean, it makes sense, but it involves a lot of admin and a lot of extra accounting. And so on. What we have done in the past two and I think what reputable builders can do is get a signed documents from each subtrade that had been on the job saying we’ve been paid. Uh, and you’re going to get that when you have, uh, um, contractors that have long standing relationships with their trades.

Jen:

And I think that’s the thing you touched on is like, we’ve been working with some of our trades, the whole career of our business, which is over 22 years. And I think, you know, when you do interview the contractor, you want to know what kind of relationships they have with us.

Matt:

And think of the management to, in terms of cost savings and time savings and so on. If your a plumber has been working with your tile setter, who’s been working with your framer, who’s been working with your drywaller for 10 years. I mean, imagine the management savings, everybody knows what they’re doing. You know, the plumber knows just exactly how we should, you know, lay as flange on top of that tile , and the tile setter knows just how, how the plumber likes it. And there’s just so much savings when that happens. Again, relationships, right.

Jen:

Works like one machine

Matt:

And clients, you know, their, their confidence is way up, cause they’re seeing people, Hey, Oh, Hey. And it’s a, it’s a big, you know, reunion every time you’re having the job. And, and it’s just, the flow is just so much better that way.

Mike:

I have a question for both of you, as you’re talking about subtrades you are both in the building business. What happens if I, as a consumer, want to bring one of my people and so often happens for the audio-video stuff, which is where I have to get involved. Is that something you recommend and B, is that something you can protect all of us for, by putting it in writing as well? Obviously, you are building the project. We know guys that you recommend. We bring our people in, or

Jen:

I know me and I don’t know if I should touch this topic,

Mike:

Mike here. No, but this is important information because may think, Oh, we want to give business to a friend of ours or we’ll save a few bucks that can actually potentially be counterintuitive to the entire process. Can it?

Matt:

Oh yeah.

Jen:

Say your opinion. Then I’ll say my opinion.

Matt:

I would say that we, we somewhat jokingly say, if you, if you’d like to bring your brother’s cousin’s best friend who was an electrician onto the job, it’s a 20% extra management fee. It kind of lightly, but kind of not. So again, it’s not just the little pieces we’re putting together. And so on, this is a whole house thing. This is a whole system, a whole thing. We’re, we’re hopefully doing the design. We’re going to build this thing. We’re going to put our warranties on them. We’re going to stand behind it. And if we introduce a different element into that, it just sort of mixes up the whole thing that. That element might be independent of our management structure. That’s a key piece, right? We need people to execute things on a particular time, in a particular series or, and if somebody else is not responsive to that, that could just mess the whole thing up. So ideally, no, you may not.

Jen:

Very similar answer. It’s the same thing because like I know of us, my dad and my brother really take the time to really, if we hire any new trades, really know their work and the quality of work. So it reflects at the end, in your brand essentially, right? Because you are promoting all these people. So the one thing that you don’t want to do is promote somebody and then they do a bad job. And then the client’s unhappy because we don’t want to make that client unhappy. Our end goal is to make you happy.

Matt:

And in the process too, I mean, imagine if, so our plumber does, let’s say a $300,000 worth of work for us in a year. Well, that plumber, if that’s the first time, or if you’ve got them through some, uh, less sort of tight relationship, they’re going to do $20,000 of work for you. Imagine if I get on the phone and they’re doing $300,000 worth of work for me, and I say, hey, over there at the Johnson job, you know, we need you right away. So stop whatever you’re doing to get over there. The reality is that these people, we have some drag with these people, they’re doing a big part of their yearly budget with us. So when we say, no, we’re staying here, we’re getting this done, it’s going to be received better.

Mike:

Well, I think it comes down to a lot of other things, as well as you bring someone in who, you know, on the job. And all of a sudden they drill through a pipe and flood the basement. Who’s liable? Is it you for bringing them in? Or is it you because it was your pipes. And there’s a lot of accountability that goes with that as well.

Mike:

That’s a great question. Us. The contractor is. Everybody in there is under our umbrella. So that’s in insurance, that’s in WorkSafe, that’s in everything. And that’s part of what you’re purchasing with this. You know, the management fee that everyone’s always like, aw, come on. Think of what you’re purchasing with that. Like piece of mind, you don’t, you don’t have to call plumbers and call people and call whatever else. You’re calling one person and they’re dealing with the person you have a relationship with and..

Jen:

And you’re on the hook. If something goes wrong. And that’s what that management fee is helping for

Matt:

Totally is.

Mike:

So, what I’m hearing is, you should work with someone who has insurance.

New Speaker:

And verify that. Do your due diligence. I mean, not only costs of construction insurance, but do they have, um, you know, are they in good standing with WorkSafe? You should be running those – homeowners should be running those checks. Right?

Jen:

Thank you so much, Matt, for coming in today. If you want to learn more about Matt, what he does, ask him any questions. Uh, some that maybe we didn’t get to like how he builds motorcycles in his spare time. Um, all you need to do is go to sasenhomes.com. Anything else you’d like to add Matt?

Matt:

Yeah. Check us out on social and pick up the phone. Give me a call (604) 765-1708. I’d love to talk to you.

Jen:

And before we go, we have one more thing to do. Mike, we’re going to talk about what we’re going to talk about next week.

Mike:

Oh yeah. This is a really important part of it. And it’s the predesigned planning. Most of the best work that we do is in the planning process of it. And we’re going to talk about design-build versus house designer versus architect, and really help set you down a road where you can understand some of the different people, the role they play and which is the right one to work with for you to create the best possible results.

Jen:

Perfect. Thank you.

Matt:

Thank you.

Mike:

Thank you.

Jen:

This has been Measure Twice, Cut Once, the podcast from HAVAN, the Homebuilders Association Vancouver. Thanks for joining us today.

Mike:

For notes and links to everything mentioned on today’s episode, go to havan.ca/measuretwicecutonce.

Jen:

Follow us and review us to help empower homeowners like yourself to make the right decision the first time, and automatically by doing so, you’ll be entered to win a gas barbeque, courtesy of our friends at FortisBC.

Mike:

Whoa, Whoa, Whoa, slow down. This. Isn’t just a gas, barbeque from our friends at FortisBC, this is a precision cooking machine. The Napoleon Prestige P 500 stainless steel, natural gas, barbeque. You can cook some great things on it. And if you know, barbeques, you know this brand is an amazing brand and an awesome prize that I wish I could win as well. Until next time this is Mike Freedman

Jen:

And I’m going to brush up on my knowledge of barbeques. I’m Jennifer Lee, reminding you to measure twice

Mike:

And cut once.

Call Now ButtonCALL US