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Few people who have gone through a major home improvement project will tell you that the whole thing went smoothly and was finished on time and with no problems. There are just too many people involved and too many things that can go wrong. With a little advance preparation, though, hopefully you can avoid the worst home improvement nightmares.
The first thing to do is to put someone in charge, otherwise you'll end up doing it yourself – architects tend to be good at this, as once they've designed the improvement, they will have an idea of who is needed to make it happen.
The next thing you need to do is absolutely vital: budget, budget, budget. It's so easy to spend far more than you wanted to if you don't work everything out in advance and set a limit that you won't go over – a few extras here and there, and before you know it you can't afford it any more. If possible, negotiate fixed prices with the builders, so that however long the project takes they will get paid the same amount. This will encourage them to finish quickly, and remove the risk of you getting stuck with a large bill. You might need to phone around for a while before you can find someone who will accept the deal on these terms, but as long as you're offering a reasonable price, they are out there.
Avoid hiring too many specialists, as you don't need that many people working on a home project. Stick to more general professionals, who can call in people they know to do the parts that must be done by someone trained or registered in that area. Avoid hiring plumbers and electricians directly, for example, as they will just stretch out the work – leave it to the builder to bring in his own plumber or electrician instead.