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What is a Demo & Discovery Contract?

Is your home in need of repair? Whether it’s due to flooding, fire, dry rot, earthquake, or any other home disaster, repairs can feel like a Pandora’s Box. It’s often hard to understand the full scope of the damage until after you begin the work. For many homeowners, this is a scary thought. What if the cost of repairing your home is more than you expected? What you need is a demo & discovery contract.

As one of the leading home remodelers in Portland, Lamont Bros. has seen our fair share of home repair projects. Sometimes, the work required to restore the home is exactly as expected. Other times, we open up a wall and discover that the damage far exceeds what it originally appeared to be. This is why we use a demo & discovery contract to assess the necessary scope of work before beginning repairs.

In this article, you’ll read about what to expect from a demo & discovery contract. Once you’re finished reading, you’ll have a better understanding of the demo & discovery process and how it ensures that you have the most home repair experience possible. The topics we’ll cover include:

What is a Demo & Discover Contract & Why is it Important?

When your home is damaged, a demo & discovery contract is an initial agreement between you and your repair team to investigate the extent of the damage. In a demo & discovery contract, your repair team will demolish the affected areas of the home to understand where and how severe the damage is.

It allows you to assess the damage before beginning repairs

Home repairs often come with hidden damages behind walls, floors, or ceilings. Rushing into these repairs without thoroughly inspecting the space can lead to unpleasant and costly surprises during the repair process. You need a contract that ensures the repair team will understand the full extent of the damage before beginning repairs. This approach allows both you and your team to have a complete understanding of the project from the start.

It results in a more accurate budgeting process

Hidden damage can significantly increase the cost of repairs beyond what was initially expected. In the Pacific Northwest, one of the most common causes of this is dry rot. We’ve seen this in dry rot repair projects where the visible damage appeared to be only a few thousand dollars, but the discovery of dry rot in a structural beam increased the cost to over $100,000. Conducting a demo & discovery before committing to repairs results in a more accurate budget at the start of the project. That way, you know how much it will cost from the start.

It gives your contractor the opportunity to plan repairs

Some repair companies start repairs without a clear plan, improvising as they uncover damages. This approach can lead to a slower, more expensive, and less efficient repair process. Demo & discovery allows your team to plan all necessary repairs accurately, ensuring that you know precisely what needs to be done and how to proceed.

Dry rot is a common form of hidden damage in the Pacific Northwest.

6 steps to a Demo & Discovery Contract?

The process for a demo & discover contract includes 6 steps designed to provide you and your repair team with all the information needed to effectively repair the home. Keep in mind that demo & discovery does not include the actual process for repairing the home, only assessing the damage and planning for repair work. 

1. Preliminary Budget

Your repair team will do an initial inspection of the damage and develop a budget range for what repairs will likely cost. This is usually a wide budget range that uses information from the initial inspection and historical data for repair projects similar to your own. 

2. Retainer Contract

You’ll pay a small retainer to your repair contractor to cover the cost of demolition and planning for the project. This retainer is typically a few thousand dollars and is counted towards the final price of the repairs.

3. Demolition

The repair team will demolish the affected areas of your home to uncover any hidden damages. This may require removing drywall, flooring, and exterior siding to perform a full investigation. The goal of the demolition is not to fully remove the damaged material but rather to remove just enough of it to fully understand the extent of the damage.

4. Damage Assessment

Your repair team will begin documenting the damages uncovered during demolition. They will likely take measurements and photos of the space to ensure that they have all the information they need to begin planning for repairs.  

5. Planning & Design

Using the information gathered from the damage assessment, your team will assemble a set of detailed construction plans for how to repair your home. This will include all of the damaged materials that must be removed from the structure and what materials will be used to restore the home to its original condition. 

6. Fixed-Price Contract

Once the repair team has a complete set of design plans, they will present it to you in the form of a fixed-price contract. The contract describes in detail the work required to restore your home and the exact cost required to complete it. Because you and your team have already taken the time to assess the damages before beginning repairs, you can be confident that the price in the contract is an accurate representation of what it will take to repair the home. 

In extreme cases, a space must be fully demolished to allow for proper repairs.

When and When Not to Use a Demo & Discovery Contract

A demo & discovery contract is an effective way to make sure you and your contractor fully understand the necessary repairs to restore your home to its former condition. However, that doesn’t mean it’s always the right option. Here are a few reasons why you should or shouldn’t use a demo & discovery contract to repair your home.

DO — If You Need to Budget Effectively

If you choose to work with a contractor who begins repairs without fully investigating the extent of the damage, you should expect to pay more than the contractor initially quotes you. Anecdotally, we’ve seen homeowners who were initially quoted a low amount to repair the visible damages, only for the price to triple once hidden damages were uncovered. 

DON’T — If You Need to Begin Repairs Immediately

A demo and discovery contract is a good way to evaluate damages, but it may delay the beginning of the actual repair process. If your goal is to begin repairs as soon as possible, you may want to forego a demo & discovery contract. Keep in mind that starting repairs sooner doesn’t necessarily mean they will be completed sooner, particularly for complex repairs.

DO — If There is a Chance the Damage Could Be Structural

Any time there’s even a reasonable concern that the damage to your home could extend to its structural members, you’ll be best served to do a demo & discovery contract to investigate. Depending on the severity, dry rot, seismic activity, and fire damage can all harm the structural integrity of your home and risk collapse. In cases like this, it’s best to do your due diligence and uncover your home’s structural members and check them for potential issues.

DON’T — If The Damages are Straightforward and Fully Visible

Keep in mind that a demo & discovery contract is intended to uncover hidden damages. If you’re working on a repair project where the risk of hidden damages is highly unlikely, begin repairs right away. There’s no point in doing a demo & discovery if you already know the extent of the damages.

Need Repairs? Let’s Chat. 

Now that you understand the demo & discovery process, you should be able to identify how to proceed with your own home repair projects. If your home has been damaged and you’re working with an insurance company to do repairs, read our article, “How to Work with a Design-Build Firm to do Insurance Repair.” 

Ready to get the ball rolling on your home repairs? If so, click the link below to schedule a free consultation with a member of our design team. We’ll help you plan the repair process to make it as painless and efficient as possible.