SINGAPORE – When renovation contractors request large sums in deposits, some homeowners might not even blink an eyelid.
It can be difficult to deal with situations that go wrong, as was the case for an owner of the Novena Penthouse who paid a deposit in excess of $152,000 to remodel his house, only to find it in a state of ruin in July.
The construction worker from the company Renosaves Project is nowhere to be seen. He had said he would construct a marble feature wall and chandelier as well as other fixtures however, he left the more than three thousand square feet unit in a state of chaos that included construction materials dumped into the rooms and wires hanging from the walls.
More than 10 homeowners who engaged Renosaves Project, and were similarly left in the lurch and have reached out to The Straits Times since the publication in November.
Since 2022, they have experienced losses of between $20,000 and $30,000 and many have submitted police reports or filed claims in the Small Claims Tribunals.
Contractors were frequently among the top three industries with complaints from 2021 through 2023, according to the Consumers Association of Singapore (Case).
Here are some helpful tips for staying alert when looking for a remodeling contractor:
- Engage accredited contractors
CaseTrust certified renovation contractors are the most reputable choice for consumers who plan to renovate their homes.
CaseTrust-accredited renovation companies are required to adopt the CaseTrust Standard Renovation Contract, that clearly defines the payment and work schedules, as well as a warranty for service, and offers transparent pricing.
Contractors that are CaseTrust accredited must limit the initial deposit up to a maximum of 20% of the total costs. The payments are made in stages, based on milestones agreed upon.
The deposit is protected through a performance bond that protects the deposit in the event the business closes before the end of the year.
The Housing Board Directory of Renovation Contractors and the Building and Construction Authority Directory are excellent sources of information for the consumer. These companies are well-reviewed and have a solid track record.
A well-established business will regularly update and maintain these certifications to show its credibility and abilities.
Even if the project is a renovation of a condo, I recommend employing a licensed contractor from the HDB. HDB.
It is also possible to determine whether the business is part of the RCMA which checks certified renovators and limits membership to around 10% of registered renovation businesses.
- Find out more about the company
An Accounting and Corporate Regulatory Authority search will reveal details about a business, such as its paid-up capital, and the details of its officers and shareholders. It costs $5.50 to purchase a business profile.
The capital that is paid up is an excellent indicator of the health of a business. In the case of Renosaves Project it has a capital paid-up of $20,000.
How can a business that has spent just $20,000 on its foundation be able to complete projects that cost more than $200,000?
HDB requires private limited companies to have at least $50,000 in paid-up capital to be listed in the HDB Directory of Renovation Contractors.
Always verify the website of the company and reviews on social media.
A reputable company would include its employees, designers experience, track record, as well as its portfolio on its site.
- Examine companies and look out for red flags
Consumers are advised to speak with at least three companies for renovation visit their showrooms, and then compare their prices.
A deal that appears too appealing to be true may not be.
Consumers should insist on a formal contract that outlines the agreed payment terms and a renewal schedule to safeguard their interests.
A contractor who requests payment that is not included in the contract should be viewed as a red-flag.
Contractors can request quicker payments and blame cash flow issues. However, a business’s financial situation has nothing to do the customer.
- What to do when you’re dealing with a contractor who isn’t reliable
The incident should be reported to Case and the police.
When Case receives a report, the Case officer will look over the complaint and then contact the customer for documents supporting the complaint.
If the matter falls within the scope of its jurisdiction, Case can represent the customer in negotiations with the retailer.
Case will provide the customer with alternatives if the issue isn’t resolved. This could include filing a claim with the Small Claims Tribunals, or obtaining their own legal advice.
Small Claims Tribunals will accept claims of up to $20,000 or $30,000 with both parties’ consent. For greater amounts the consumer will have to bring a civil suit.
Cases can also refer unruly retailers – including renovation contractors who continue to engage in pursuing unfair trade practices to the Competition and Consumer Commission of Singapore (CCCS) to investigate.
CCCS can file an injunction application in the courts against retailers that continue to be errant according to its website.
If they fail to follow the directions of the injunction, CCCS may take them to court on contempt charges. If found guilty, the defendant could be fined up to $10,000 or jailed for up to a year or both.
While CCCS doesn’t hold any contractors to task for their work on renovations They remain vigilant in monitoring the market.
CCCS concentrates on identifying and dealing with particularly flagrant unfair trade practices like situations in which there are multiple instances against a company that continues to engage in unfair practices, despite the intervention of Case.
CCCS will evaluate the responsability of the contractors’ actions and the extent of harm to consumers before deciding whether to investigate such cases with the view of getting orders from the court to prevent the contractor from engaging in the unfair trade practices.