Renovation gone wrong: Family forked out over S$130,000, then their contractor ‘went missing’
Unexpected extra charges, unusual payment requests and stalled work that dragged for months ended in a costly loss for this Singaporean family. CNA’s Money Mind finds out the renovation red flags worth heeding.
Screenshot of a video showing the renovation work in the family’s Housing and Development Board flat. (Source: Errol Lee)
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SINGAPORE: It was going to be his parents’ retirement home, and the renovation was supposed to cost at most S$80,000.
Errol Lee’s family ended up paying S$216,000 in what became a renovation nightmare as their contractor bailed on them. And the bulk of the money was from his parents’ retirement savings.
It was a high price to pay to get the flat they had planned for. There were warning signs, though, and Lee shared his story with CNA’s Money Mind to unpack some of these renovation red flags.
At first, he thought, nothing seemed out of the ordinary.
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His family had received a few other quotations in the range of S$130,000 to S$150,000 — “way above” their budget — before they went with their contractor. Price was a reason, and they also “thought his entire setup was quite credible”.
The online reviews looked reassuring. The company had a few showrooms. And its director assured them that he would take care of the project personally.
“He was very responsive,” Lee said about the man who seemed to have “quite a lot of experience” as he had mentioned renovating more than 300 homes. “We thought, (with) him being the director … we’d be in good hands”.
Then the contractor asked for more money: Extra hacking (S$23,210), more carpentry (S$16,557), windows (S$9,000) and electrical work (S$8,700) were just some of the add-ons.
The work slowed. And then came a different request: To transfer S$35,000 to the director’s personal account, not the company’s account. The family hesitated. Some of them wanted to wait; others feared that the renovation would stop altogether.
The company had “some issues” with transitioning to another bank, Lee recalled being told as to why the transfer could not be made to company accounts.
“At that point,” he said, “we were a bit anxious to get the house ready so that we could move in before CNY (Chinese New Year).”
But the payments did not stop there. In total, they transferred S$47,000 to the director’s personal accounts.
When the family finally inspected the home, they realised the problem was not just unfinished work.
For one thing, the kitchen counter and drawers were about half of the required depth. “We realised that we couldn’t even fit our utensils,” Lee said.
And although they had been told the painting was done and were shown a video, they found that the house was only half painted, he added. “We were only shown … the parts that were painted.”
They also discovered that the interior designer had used none of the products and fittings from the vendor they had chosen. When queried, he told them he was at another vendor, ordering their kitchen appliances.
“He just brushed us off and said that because this vendor was significantly cheaper, he was trying to help us save money,” said Lee.
Five months after the work began, the interior designer ghosted them. “His showrooms were all vacated. Then we realised that the money wasn’t … coming back,” Lee said.
By then, the family had forked out more than S$130,000. Yet, their home had to be rebuilt. And the interior design firm has since gone into liquidation.
WATCH: They paid over S$130,000 for a home renovation. Then the contractor disappeared (7:17)
EXPERTS WEIGH IN
Linus Ng, the chairperson of the Consumers Association of Singapore’s consumer education committee, said a low quotation is a “very common bait” to lure home owners.
It will come with “a lot of add-ons”, which can “balloon into huge sums”. He said: “That’s what we see nowadays in the problems that renovation contractors … heap upon the consumers.”
When an interior designer asks for more payments despite making slow progress with the renovation, that is another red flag, highlighted Mervin Foo, co-founder of renovation platform HomeMatch. “This could be a sign of the firm facing financial difficulties.”
It is a “common scenario” among firms facing severe cash flow problems. Even if they do not close down, “they can’t continue paying their subcontractors or don’t have working capital for materials”, he said.
“That’s when renovations stall. Then home owners are left stranded.”
As for payments to a personal account for services rendered by a company, Ng said consumers would be on dangerous ground.
“You should only pay the company because the company and the directors are all separate legal entities,” he said. “The contract is with the company. It’s not with this director. So why should this director be paid?”
On why the family did not terminate the contract, Lee said it “wasn’t an option” because they had already put down “a good amount of money”. He added: “We were also just worn down by the whole process.”
After the first renovation dragged on for months, they had a second interior designer come in to “salvage the house”, including hacking the carpentry in the kitchen and redoing the entire kitchen for them to have usable space.
The electrical work and plumbing also had to be redone. The light fittings had not been fixed at all, said Lee, recounting how they saw wires “hanging out” after the first interior designer “went missing”.
They decided to have the entire house repainted as well. The only work done by the first interior design firm that remains intact in their house is the tiling — which cost “maybe S$20,000” at most, Lee reckoned — and the windows.
Everything else was rebuilt, which the second interior designer managed to finish in six weeks for S$70,000. But the family also had to pay for temporary accommodation (S$9,000), plus storage and transport (S$7,000).
They never imagined that their eventual renovation bill would top S$200,000.
“It was our first renovation after so many years,” said Lee, who shared that the family had been living his parents’ previous home for more than three decades. “It was a very new experience.”
On reflection, he added: “The first step should always (be to) find out about all these horror stories — what could potentially go wrong — before looking for an interior design firm and not get sold (on) the marketing.”
Watch this Money Mind segment here. The programme airs every Wednesday at 9pm.
Source: CNA/dp
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