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In Chicago, a homeowner may pay the main contractor on a remodeling job $15 an hour for a carpenter whose wages are $6 05 an hour. The difference is made up by fringe benefits, payments to subcontractors—and a 50% to 60% markup that covers the contractor's overhead and profits. In addition, contractors usually buy pipe, lumber and other materials at discounts, but charge the homeowner the standard price plus "delivery costs." The markup over the contractor's price ranges from at least 10% in Chicago to 30% in Miami.
Trusting to Luck. So much money is involved that ambitious contractors can quickly build substantial businesses. Chicago's Tony La Pelusa, for example, started a tiny contracting firm at the age of 19. He picked a specialty—installation of aluminum siding, windows and eaves—and advertised heavily. Today, at 26, he owns three trucks, employs eight workers and farms out work to subcontractors. Vincent Bardis, 40, a former salesman, has built a bigger Chicago business by coordinating the work of 36 subcontractors. His firm has booked $750,000 worth of business so far this year. For some other contractors, repair and remodeling work have served as the launching pad into house-construction. William Adkison and Ralph DeMeo, a couple of Florida carpenters who were earning $2.83 an hour a decade ago, joined to start A.D.H. Construction Co. The firm did extensive remodeling work, earned enough to begin building apartment houses. It recently moved into a Taj Mahal-like building, which has a steam room, sauna, exercise room and bar.
The man who resents paying the high price of home repairs has few alternatives. Some save by acting as their own contractors, buying materials at the contractor's discount and employing moonlighting carpenters and electricians. The moonlighters generally charge only their actual wage rate, plus perhaps a dollar an hour. But few homeowners are able to estimate the quantity, sizes and types of materials that a job may require; even fewer know enough to supervise and coordinate the work of the craftsmen. It would take an expert to tell the good workmen from the many others who produce most of the grumbling about warping walls, quick-cracking concrete and misconnected electric lines. A homeowner can weed out the worst contractors by consulting his local Better Business Bureau, and the BBB can sometimes prod a contractor to correct faulty work. Most of the time, however, the harried homeowner must trust to hunch—and luck.