We have officially started the last week of the house portion of the project. Our target was that the house itself would be completed by September 30 and that October would be reserved for issues outside the house: completion of the wall and spikes, completion of the shop, completion of the canal, etc. We “might” actually hit our target, so this looks like a good time to review the entire project and call out some of the problems I have only hinted at before.

The Good: The contractor that we eventually hired had an architect/engineer friend who came up with two modern designs, both of which we liked. We asked for elements from both designs which he combined to create a final design. We were excited.

The contractor came up with a bid which I thought was OK but maybe a bit high. He ultimately agreed that his bid would be a fixed price; meaning that there would be no cost increases from inflation. As you will soon see, this became irrelevant. Nonetheless the negotiations went well and soon we were signing a contract with a lawyer.

Not long after, the construction started. While I would hate to categorise the entire subsequent process as bad, this was the end of the honeymoon period.

The Bad: Our contractor hired a foreman and work commenced. We were soon to find out that the foreman was only hired for 2 days/week. We complained about that but the contractor assured us that between he and the foreman there would be plenty of supervision. There never was.

A small crew, averaging 6-8 began the wall (or fence as it’s called here) surrounding the property. Janet and I would come over daily to check the progress. Sometimes progress was being made and sometimes not so much. More complaints to the contractor, more assurances, and the wall progressed, though slowly.

Three months later the wall was mostly done and they switched to work on the house. The crew expanded to about 12-13. It was quickly clear to us that a crew of a dozen would take two years to finish the house. More complaints, more assurances but the crew was rarely large enough.

There were ups and downs, mistakes and more mistakes, but yet the house did begin to take shape. Within six months we could see that these guys might actually be capable of building this house; we really weren’t sure before. But by the six month mark, money became a worry.

The contractor’s money methodology was simple. He would ask for a certain sum of money monthly and I would give it to him. After a few months the pattern was set but I could do the math and confronted him, “At the rate you are asking for money, the money will run out before the house is completed.” He assured us the first few months were the larger portions of money required because of steel and concrete, etc. and that later requests would be smaller. This never turned out to be true.

As a certain point Janet and I had one of those “Come to Jesus” meetings with the contractor. Janet said, “We have given you half the budget but we only have 25% of a house.” He again reassured us, showing us the numbers of what was still left to buy and how much got paid to the crew and that we still had money to complete the project. I was skeptical. Similar conversations and similar assurances would occur monthly.

Janet would try to assure me. “We have a contract. We can sue him if he doesn’t finish.” As the more experienced and more cynical partner I told her “A contract is only good if the person you are suing has money to pay you.” Nonetheless since progress continued we remained cautiously optimistic.

As I have documented in other blog posts, not only was supervision of the crew hit and miss, so was material purchasing. The crew and foreman often complained to us about not having the materials they needed. We would complain to the contractor and eventually more materials would arrive. But this clearly slowed the project. And less efficiency meant more cost.

We tried to help the contractor save money. Whenever we would see a needed piece for the project on sale we would contact the contractor. “Robinsons has overhead fans on sale for a great price.” We would buy the sale items and minus that amount of money from what we owed the contractor. While this should have been his methodology all along (shopping for deals), in the end it didn’t help him.

We also tried to help the contractor schedule the job. In June we went to the contractor and told him we needed the house done by the end of September so that we could move in during October. He agreed that it could be done. He told the workers that if they finished by September 30 he would give them a lechon party. Lechon is very big in the Philippines and for a few weeks the crew was excited. Pretty soon they knew the truth; that there would be no lechon.

The Ugly:

And then the fateful day occurred (cue organ). The contractor asked to meet with us at our rental home, which he never did before. He explained that he had no more money and had used some of our money to buy himself a piece of property. He couldn’t sell the property because the title was not finalised and the economy was soft.

Frankly we already knew that he had purchased a piece of property. This is the Philippines and everyone knows everyone’s business and so we had been told months before that the contractor had bought a lot. At the time my attitude was, ‘Well he’s entitled to make a profit and if he uses some of his profit to buy a lot that’s his business, as long as I get my house.’ But now it was clear we were not going to get our house.

Our first step was to take over all purchasing for the project; we simply felt we could no longer give the contractor any more money. What was shocking was how little materials were at the project. The crew needed everything. I made a list of the major elements I knew still had to be purchased, but that list turned out to be a fraction of what they really needed. Janet and I were going to stores all day long every day and cash was flowing out of our bank faster than I could keep track of it. My desk had a stack of receipts which I tracked on my spreadsheet and soon it was official; the budget was spent and we were in the red.

For the next few weeks we gave a modest amount to the contractor weekly to pay the crew. Then one day I was contacted by a guy who was also using our contractor. “Is your crew being completely paid? Mine isn’t and they are ready to quit.” I said, “I think they must be – no one’s complained.” The next day Janet and I went to the site and asked each crew member. BTW, by this point in time the crew was over 30. Every crewman was owed some money. One poor guy was owed back pay for three weeks.

At that point we took over the payroll and paid everyone everything they were owed. It was the equivalent of an extra week’s pay.

For all intents and purposes we took over the running of the project. We asked the foreman if he could temporarily work more days and he agreed. Janet spent 8 hours a day on site watching the crew and yelling at them; she does this well. I ran around daily buying stuff. We were and are busy busy retirees.

We brought in Janet’s oldest brother, Marlon from Cebu to work. He’s worked very hard and really shown some of the crew members how work is supposed to be done. This has turned out to be a good decision, although our little rental house is now a crowded little rental house.

While there have been plenty of glitches everyone can see that the crew has worked harder and gotten more done. With luck (fingers crossed) this week the final elements of the house will be done. On Saturday Janet is giving the crew the promised lechon party.

Next week the air conditioners get installed and the crew moves to the outside projects and shop completion. With even more luck those elements will be completed in October.

In the meantime we know that there are a hundred little touch up jobs required in the house, mostly involving paint. I will be finishing the doors and there are a lot of them. Janet plans to bring the kids up from Alcoy on their school break to clean. Only in the Philippines do kids get excited to come to an overcrowded rental house to be worked like dogs.

The Ugliest: I may be conning myself, but I pride myself in telling the truth. It may be my truth or my interpretation of the truth but still I tell the truth. I ran a business for 14 years and when problems occurred I told the customer the hard truth. I worked at Intel for 15 years and told my accounts (Fortune 500s all) the cold hard truth and they accepted it.

I have become angered and depressed by how often I have been lied to in this process. Sometimes the simple lies are lies of omission, sometimes the gentle lies of ‘we don’t want to admit there’s a real problem,’ but many times bald faced lies were told to my face. It was infuriating and at times deeply depressing. I have no conclusions and no interest in globalising my experience but when I say “two plus two is four” and am told “no it’s five” – well as I say it’s infuriating.

While I don’t have final figures yet it looks to me like we will end up 20% over budget. The contractor promises that when he sells or mortgages his property he will give us some money. It might happen but I’m not holding my breath. He’s actually not a bad guy but got in way over his head.

Conclusions: Assuming you still want to own a house in the Philippines after having read all these blog posts, here are my recommendations:

1. Buy an existing house. There are plenty of “foreigner houses” for sale throughout the Philippines and often for good prices.
2. If you must build your own dream house, function as your own contractor. Hire an engineer and or foreman to run the project, while you do the purchasing. You will spend a year or more of your life going crazy, but it is probably the safest way.
3. Did I mention that you can buy an existing house here and let your wife remodel it?

A funny (in my warped way) story: We did know for months that our contractor was in financial trouble because he kept listing stuff for sale on FB Marketplace. Generally it was stuff I would have no interest in but a few weeks back he listed a high end Canon camera with a couple lenses; a model that would have been a professional model a few years back. I like photography but sold my Nikon gear before I moved here. BTW, when I worked at Intel there were practically fights in the hallways over the Nikon vs. Canon debate. Shows you what nerdy engineers will get excited about.

I sent him a message. “Why don’t you just give the camera to me, as part of what you owe me.” He agreed, but could I give him a little bit to pay off the last of the workers. I agreed. When Janet and I inspected the camera I asked, “How long have you owned this?” “Eight months,” was his reply. Janet and I caught each other’s eye. I knew I was basically getting back the camera I had paid for.

So, I don’t have a house yet but I do have a nice camera.