Paying for home improvements – what’s really happening

With £30bn currently owed to UK tradespeople in unpaid invoices and 75% of homeowners struggling to trust tradespeople, we decided to dig a little deeper and find out what’s actually happening.

We conducted two independent surveys* quizzing all sorts of tradespeople, from builders to pavers, and UK homeowners, about their experiences of paying and getting paid for home improvement work.

Here’s what we found out.

payments infographic

For years, we’ve heard stories about homeowners losing money to rogue tradespeople, but we don’t tend to hear much about tradespeople’s experiences. While nearly a quarter of homeowners say they’ve lost money at the hands of rogue tradespeople, 77% of tradespeople have had homeowners refuse to settle the bill – that’s three times as many! 2 in 5 of them have had a homeowner not pay a single penny for work. Those payment problems are affecting how much money they take home every year, with the average tradesperson losing 20% of their earnings each year.

Interestingly, while the quality of work can lead to payment disagreements, most of the homeowners who say they were ripped off had problems with builders, yet it’s pavers that have had the most trouble getting paid.

So, what’s causing the payment issues?

You’re always going to get the odd bad apple, whether that’s a tradesperson delivering bad service or a homeowner not paying up, but in many cases, there are other factors at play. When we launched our cost guides at the start of the year, we found that two thirds (68%) of homeowners in the UK didn’t set any kind of budget for projects that are likely to cost more than £100, and 18% of homeowners had to stop a project part way through due to running out of money.

unfinished building project

We also know that while the majority of jobs on our own platform go smoothly and lead to 94% of the tradespeople ratings being for 4 or 5 stars (out of a total of 5), on the rare occasion there’s an issue, we often find that it could have been avoided if the homeowner and tradesperson were on the same page from the start about when to pay and what they were paying for. So, these things tell us that payment issues don’t always have a malicious cause.

What’s the solution?

We’ve teamed up with Shieldpay to offer Protected Payments to our customers, a way for homeowners to pay tradespeople for home improvement work. A homeowner and tradesperson have a conversation upfront about the job and agree the cost of the work. The homeowner then pays their money into Shieldpay’s online vault while the work’s being done and it’s held securely until they confirm that they’re happy the work’s been completed, as agreed. The money is visible to both the homeowner and tradesperson at all times, so the homeowner knows their money’s safe and the tradesperson knows that the homeowner has the money to pay them for the work they’ve done.

happy homeowner paying for work

For more information about Protected Payments, head here.
Watch our video Q&A about it here.
Are you a homeowner wanting to find out more, or set up an account? Head here.
Are you a tradesperson wanting more information, or to set up an account? Head here.
For specific questions on Protected Payments, check out our FAQs.

* Atomik Research polled 2,001 adults and 500 tradespeople aged 18+ from the UK on behalf of Rated People.

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