10 Lessons To Learn From Three Renovation Scams in Singapore

In Singapore, there has yet to be an official regulation for renovation contractors or interior designers. The barriers to entry to become one happens to be really low. What this means is that anyone and everyone can simply open an interior design firm, claim to be an interior designer and take up renovation projects.

Source: Pixabay

This has opened up the floodgates to renovation scams, which are really rampant in Singapore. Last year, there were more than 180 cases filed with Case against rogue interior designers and contractors. Just this year alone, we’ve already seen a couple of high-profile cases reported in the news where renovation companies have taken off with homeowners’ monies, leaving them with unfinished projects or jobs that haven’t even started. Here are three recent renovation scams in Singapore and what we can learn from them.  

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THE SCAMS:

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Full payment, but no renovation work done

This was one of the higher profile renovation scams that happened in Singapore just this month. It was reported in various media outlets, including here. The family had engaged this particular interior designer for the renovation of her 5-room flat and was told that the total costs of the works would amount to $38,600. But even after paying the full amount, the home has yet to be renovated. A visit to the company’s office found that the store is now up for rent.

 

Missing in action and works left incomplete

This renovation case was reported at the end of 2016. The alleged cheat, who's a renovation contractor, had reportedly encountered cash flow problems, which left many of the renovation works unfinished. Homeowners had tried to get hold of him, but calls and texts were left unanswered. The interior designer, now supposedly overseas, also sought to borrow money from some of his customers.

 

Poor excuses, fraudulent identities and no work done

In this third renovation scam, it was reported last month that Case has received 33 complaints for this renovation company alone. A quick check on the Internet found that there were complaints for the interior designer that actually surfaced in the middle of 2016. It was also revealed in a forum that many of the homeowners were given very low quotations by the company. Most complaints were on unfinished renovation works or on works that did not even begin.

Source: Pixabay

 

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WHAT CAN WE LEARN:

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1. Always do due diligence on the design firm you’re planning to engage for your renovation. The obvious first step to check if an interior firm is operating a legitimate business is to check if they are registered under the Accounting and Corporate Regulatory Authority (ACRA) with a decent paid-up capital. For a greater peace of mind, choose firms that have been registered for more than just a couple of years.

2. Scour the Internet and forums and read up on reviews before you sign under the dotted line. There’s plenty of information out there. In the first renovation scam, the victims failed to see a 1-star rating on the company’s Facebook page given by another customer who commented that the director of the firm was actually already under police investigations.

3. Make sure the firm has a physical location. Although we’ve seen in scam #1 that having a physical location alone isn’t a guarantee, it beats a company that has no site to its name. Observe how they do things in the office space. Do they appear all over the place? Does the office look like a temporary location? Do they have a legitimate signboard?

4. To be extra safe, request to visit other job sites that are currently in progress. Seeing a file of portfolios isn’t the best way to gauge their credibility. And as we’ve seen in scam #2, don’t limit yourself to just one job site. Request to see a few. Seeing actual work sites not only gives you evidence of actual work being done, it also allows you to see the quality of their workmanship.

5. It helps if the company is a CaseTrust accredited renovation business. Having this accreditation means that the company undergoes workmanship assessment and there will be compulsory mediation by Case in the event of disputes. Also, as a CaseTrust accredited company is required to buy an insurance bond for their customers, you will be compensated in the event of an unfinished renovation job. Visit this page to see the list of CaseTrust accredited renovation businesses.

6. Never, ever pay the full amount for your renovation even before works have started. In the scams we listed above, many of the victims had actually paid a large amount to their contractors even before any work was done. While a few companies would require a small amount of deposit, approximately 15 percent is reasonable, before they start work, under no circumstances should you pay the full amount before you see anything done. Be very wary of interior designers or contractors that require a huge payment upfront. Only pay the full amount when everything is completed based on your contract.

7. Pay the subsequent instalments only after you’ve seen actual work done, which means you should also visit your home regularly during the renovation to check on the progress.

8. When signing a renovation contract with a firm, it pays to “open your eyes big big”. Several things to look out for include the payment terms (what do you pay at which stage of the renovation work), renovation schedule (how long will they take to complete the work, and what happens if there’s a delay?), renovation costs (make sure the brands you’ve agreed on during the discussion for certain materials or fixtures are spelled out clearly in the contract), contract termination clauses (what are the penalties), clauses on how to handle unforeseen changes, as well as what costs are excluded from the contract (are electrical works included, for example). Never take a designer or contractor’s verbal word for it. Always have a physical or digital copy of what was agreed upon.

9. Changes during the renovation process are sometimes inevitable, whether from the contractor or the homeowner. Make sure the new changes are reflected in the contract.

10. Sounds too good to be true? It probably is. Don’t be taken in by very low quotations, as in the case of the victims in the third scam. Do your research and compare quotations from different companies to see what the market rate is like. In general, they won’t differ too much. Of course, not every low quotation is renovation scam waiting to happen. How much a renovation will cost will also depend on the type and brand of materials used.

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Browse through the list of Interior Designers, their reviews and portfolios at http://www.renonation.sg/professionals/interior-designers/

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