Homeowners

How to Hire the Best (Affordable) Contractors to Work on Your Home This Year

Home repairs are unavoidable. There’s no telling when an appliance will give up or something expensive will break.

And while home improvements may not be as urgent, upgrading a kitchen or remodeling a bathroom can improve your quality of life (and drive up the sale price of your home when you’re ready to sell).

With ongoing inflation, tariffs, and today’s economic uncertainty, it’s more important than ever to keep home repair and remodel costs down while still hiring a qualified contractor to tackle the job safely and correctly.

Repair and remodeling costs were up 3.35% over 2023—and up nearly 70% since 2013, according to Verisk’s Q3 2024 Remodel Index Report.

“Don’t rush,” advised Rick Berres, owner of remodeling company Honey-Doers. “Shop around first... You’ll quickly get a sense of the going rate for the service you need and who’s pricing fairly versus overpricing.”

Homeowners considering a large project may be able to finance the work with a home equity loan or a refinance.

A Home Equity Line of Credit (HELOC) lets homeowners tap into their equity and use it as a line of credit, similar to a credit card. Cash-out refinances help homeowners tap into their equity by taking out a new mortgage larger than their existing one and pocketing the difference.

Homeowners may also want to consider a second mortgage. This is a loan in addition to their existing mortgage that allows them to access their home’s equity.

Below, we’ll review some methods for doing remodels and repairs on a budget—while still finding the best contractor for the job.

Set a realistic budget

The first step to repairing and renovating on a budget is, of course, to set that budget. Review your finances and decide what you’re comfortable spending.

Be conservative with your budget to allow for surprise expenses. More than half of homeowners run into unexpected costs when working with contractors, according to Angi’s State of Home Spending report.

For instance, if you can spend $10,000 on a bathroom remodel, limit yourself to a $7,500 quote.

If the reno ends up costing more, you’ve got money in the bank you can afford to spend.

DIY what you can

If you have basic do-it-yourself (DIY) skills and essential tools at home, you can tackle a part of a project on your own to keep costs down.

For instance, a plumber may knock down drywall to fix a leaky pipe and then install new drywall when the job is done. Rather than hire a painter, you can paint the new wall yourself.

Similarly, remodel projects with major demolitions result in a lot of junk to be hauled away. Contractors usually charge extra for the disposal. If you have a truck, work gloves, and a little free time, you may be able to save some cash by hauling away the waste yourself.

Read real customer reviews

Don’t hire someone without checking their reviews online, but don’t only look at the reviews a contractor highlights on their own website. Those are bound to be hand-picked to showcase the contractor at their best.

Instead, find reviews on third-party sites, such as Yelp, Better Business Bureau, and Google.

If you see a lot of negative reviews, you may want to hire someone else for the job.

Ask friends and family for referrals

It’s even better if you get a referral. Start with friends, relatives, neighbors, and coworkers. You can also survey acquaintances on social media if you need input on a highly specialized contractor.

“Referrals are everything,” said Nora Cruse, professional home remodeler and lead kitchen designer for remodeling company Renewed Life Properties. “Good contractors are always getting referred to by happy customers.”

Make sure they’re licensed and insured

While you can hire a handyperson for minor tasks, such as painting, drywall repair, or basic landscaping, stick with a specialized contractor for more complex work.

Always verify a contractor, such as a plumber, electrician, or HVAC specialist, is licensed in their field.

You should also ask contractors for proof of insurance and for samples of their work. A legitimate business should have no problem providing either.

Get quotes from at least three contractors

When shopping for a new car or appliance, you probably don’t go with the first item you find. You shop around.

Finding a contractor should be no different. Get quotes from at least three.

Going with the cheapest quote is a no-brainer if you’re on a tight budget. But you will want to ensure the contractor has stellar reviews, is licensed and insured, and can work within a timeline suitable to your needs.

If one quote is significantly lower than the others, proceed with caution.

“Don’t be afraid to ask questions about why they’re able to offer such a low quote,” said a spokesperson for Angi, a home services website. “It might be that they are using cheaper materials or hiring fewer subcontractors.”

Understand the difference between a quote and an estimate

If a contractor provides an estimate for a project, this might look quite different from your final bill.

“A quote is a professional quoting the price they’re going to charge you,” said Berres. “An estimate is an approximate price a contractor may give you for a job… The bottom line is, one’s a fixed price [quote], and one’s an approximation [estimate].”

Make sure you have an official quote—and get it all in writing—before moving forward.

Don’t pay upfront (and don’t pay cash)

Payment schedules vary by contractor, but you’ll often pay a little upfront (like a down payment), more at various project stages, and a final payment when work is complete.

“We make clients pay upfront if we find and source the materials,” said Cruse. “Then, two days before, we ask for a third of the labor costs. Then, when the project is done, they pay for the rest.”

Being asked to pay for everything up front is a major red flag.

Often, homeowners put down 30% at the start of the job, another 30% in the middle of the work, 30% toward the end, and then the remaining 10% once the job is finished.

If a contractor asks you to pay them in cash (even if it’s for a discount), steer clear. Both the payment and statement of work should have a clear paper trail to ensure both parties keep up their end of the deal.