General Contractor vs Subcontractor: Houston Guide 2025
Confused about the difference between general contractors and subcontractors? You're not alone. Understanding these roles is crucial for any Houston homeowner planning a renovation or construction project. This comprehensive guide explains exactly what each does, how they work together, and which approach saves you time, money, and stress.
Key Insight
Bottom Line: A general contractor manages your entire project and coordinates all subcontractors. Subcontractors specialize in specific trades (electrical, plumbing, HVAC, etc.). For most homeowners, hiring a general contractor provides better results than attempting to coordinate subcontractors yourself, despite the 15-25% management fee.
What Is a General Contractor?
A general contractor (GC) serves as the project manager for your construction or renovation. They oversee all aspects of the job from start to finish, acting as your single point of contact throughout the project.
General Contractor Responsibilities:
| Responsibility | What This Means for You |
|---|---|
| Project Management | Creates project timeline, coordinates all work, ensures project stays on schedule |
| Hiring & Supervision | Selects, hires, and supervises all subcontractors and workers |
| Permits & Inspections | Obtains all required permits, schedules inspections, ensures code compliance |
| Material Procurement | Orders all materials, coordinates deliveries, manages inventory |
| Quality Control | Inspects all work, ensures quality standards, addresses problems immediately |
| Budget Management | Provides detailed estimates, manages costs, handles change orders transparently |
| Communication | Provides regular updates, answers questions, keeps you informed daily |
| Problem Solving | Handles unexpected issues, makes decisions quickly, minimizes delays |
| Warranty & Follow-up | Provides workmanship warranty, handles post-project issues |
What Is a Subcontractor?
A subcontractor (sub) specializes in one specific trade or skill. They're hired by general contractors (or sometimes directly by homeowners) to perform specialized work that requires specific licensing and expertise.
Common Types of Subcontractors:
| Subcontractor Type | What They Do | Required License in Texas |
|---|---|---|
| Electrician | Electrical wiring, panels, outlets, lighting, code compliance | Texas Master Electrician License |
| Plumber | Water supply, drainage, fixtures, gas lines, water heaters | Texas Master Plumber License |
| HVAC Technician | Heating, cooling, ventilation systems, ductwork | TDLR HVAC License |
| Framing Carpenter | Structural framing, walls, roofs, load-bearing elements | No state license (verify insurance) |
| Finish Carpenter | Trim, cabinets, doors, baseboards, crown molding | No state license (verify insurance) |
| Drywall Installer | Hanging, taping, finishing drywall | No state license (verify insurance) |
| Painter | Interior/exterior painting, staining, finishing | No state license (verify insurance) |
| Flooring Installer | Hardwood, tile, carpet, laminate installation | No state license (verify insurance) |
| Roofer | Roof installation, repair, waterproofing | No state license (verify insurance) |
| Concrete/Foundation | Foundation work, slabs, driveways, structural concrete | No state license (verify insurance) |
Subcontractor Responsibilities (When Hired by General Contractor):
- Perform Specialized Work: Complete their specific trade tasks according to project plans
- Follow Schedule: Show up on time, complete work within agreed timeline
- Meet Code Requirements: Ensure all work meets local building codes
- Coordinate with GC: Communicate schedule, materials needs, and potential issues
- Provide Warranty: Stand behind their workmanship and materials
- Maintain Insurance: Carry proper liability and workers' compensation insurance
Key Differences: General Contractor vs Subcontractor
| Aspect | General Contractor | Subcontractor |
|---|---|---|
| Scope of Work | Manages entire project across all trades | Performs one specialized trade only |
| Who They Report To | Works directly with homeowner | Works for general contractor (or homeowner if directly hired) |
| Licensing | No state license required in Texas (verify TRCC registration, insurance) | Trade-specific licenses required (electrician, plumber, HVAC) |
| Permit Responsibility | Obtains all permits, coordinates inspections | Works under permits pulled by GC |
| Project Timeline | Responsible for overall project schedule | Responsible only for their portion of work |
| Payment Structure | Receives payment from homeowner in milestones | Receives payment from general contractor upon completion |
| Warranty Coverage | Provides comprehensive project warranty | Provides warranty only for their specific work |
| Coordination Role | Coordinates all subcontractors, schedules, deliveries | No coordination responsibility |
| Cost Structure | Includes labor, materials, management fee (15-25%) | Charges only for their labor and materials |
| Insurance Coverage | Carries general liability covering entire project | Carries trade-specific liability insurance |
How General Contractors and Subcontractors Work Together
On a typical Houston remodeling project, here's how the relationship works:
You Hire the General Contractor
You sign a contract with the general contractor who takes full responsibility for your project. They provide one comprehensive estimate covering all labor, materials, permits, and management.
GC Hires Subcontractors
The general contractor selects and hires all necessary subcontractors based on their experience, quality, reliability, and availability. You typically don't meet or negotiate with subcontractors directly.
GC Coordinates Schedule
The general contractor creates a detailed schedule showing when each subcontractor will work. They coordinate sequencing (plumbing rough-in before drywall, electrical before final fixtures, etc.).
Subcontractors Perform Their Work
Each subcontractor arrives on schedule, performs their specialized work, and coordinates with the GC for inspections. The GC inspects their work before the next subcontractor begins.
GC Manages Quality Control
The general contractor ensures each subcontractor's work meets quality standards, building codes, and project specifications. They address problems immediately and coordinate corrections.
GC Handles Payment
You pay the general contractor according to your contract milestones. The GC then pays each subcontractor upon completion of their work and inspection approval.
Should You Hire a General Contractor or Subcontractors Directly?
This is one of the most common questions Houston homeowners ask. The answer depends on your experience, time availability, and project complexity.
Hire a General Contractor When:
- You Have No Construction Experience: Without construction knowledge, coordinating trades is overwhelming
- You Have Limited Time: Managing a project requires daily oversight and coordination
- Your Project Is Complex: Multi-trade projects (kitchen remodels, additions) need professional coordination
- You Want One Point of Contact: A GC shields you from coordinating 5-10 different subcontractors
- You Value Your Time: Your time spent managing the project may exceed the GC's 15-25% fee
- You Want Warranty Protection: GCs provide comprehensive warranties covering all work
- You Need Permit Expertise: GCs handle all permits, inspections, and code compliance
- You Want Insurance Protection: GCs carry insurance covering the entire project
Hire Subcontractors Directly When:
- You Have Construction Experience: You understand trade sequencing, codes, and coordination
- You Have Significant Time: You can dedicate hours daily to managing the project
- Your Project Is Simple: Single-trade jobs (painting, flooring) don't require complex coordination
- You Know Reliable Subcontractors: You have established relationships with quality tradespeople
- You Can Handle Permits: You're comfortable navigating Houston's permit and inspection process
- Budget Is Your Top Priority: You're willing to trade time and stress for 15-25% savings
- You Accept More Risk: You're comfortable assuming responsibility for coordination problems
⚠️ Warning: Hidden Costs of Hiring Subcontractors Directly
Many homeowners assume hiring subcontractors directly saves 15-25%, but these hidden costs often erase savings:
- Permit Fees: You pay permit fees, expedite fees, and re-inspection fees for failed inspections
- Scheduling Delays: Subcontractors prioritize general contractor projects over homeowners (steady work source)
- Coordination Mistakes: One subcontractor damages another's work - who pays to fix it?
- Material Waste: Without bulk purchasing power, you pay retail prices and over-order materials
- Rework Costs: Without proper coordination, work gets done out of sequence and must be redone
- Time Value: Hours spent managing the project have opportunity cost
Reality Check: Most homeowners who hire subcontractors directly spend similar total amounts or more than using a general contractor, with significantly more stress and time invested.
Cost Comparison: General Contractor vs Subcontractors
Example: $50,000 Kitchen Remodel in Houston
| Approach | Direct Subcontractor Costs | GC Management Fee (20%) | Total Project Cost |
|---|---|---|---|
| Hire General Contractor | $40,000 | $10,000 | $50,000 |
| Hire Subcontractors Directly | $40,000 | $0 (you manage) | $40,000 (theoretical savings) |
What That $10,000 General Contractor Fee Covers:
| Service | Value to You | Estimated DIY Cost/Time |
|---|---|---|
| Permit Handling | Obtains all permits, schedules inspections, handles corrections | $500-$2,000 fees + 20-40 hours your time |
| Schedule Coordination | Manages 8-12 subcontractors' schedules, ensures proper sequencing | 2-4 hours daily for 8-12 weeks = 112-336 hours |
| Quality Inspections | Daily quality checks, immediate problem correction | 1-2 hours daily + expertise to identify problems |
| Material Ordering | Bulk pricing, correct quantities, coordinated delivery | 10-15% material markup + ordering time |
| Insurance Coverage | General liability covering entire project, all subcontractors | $2,000-$5,000 for project-specific policy |
| Problem Solving | Handles unexpected issues, makes quick decisions | Stress, delays, potential costly mistakes |
| Warranty Protection | Comprehensive warranty covering all work and trades | Limited individual warranties, unclear responsibility |
Value Perspective
If you value your time at just $30/hour (Houston median wage), and spend 150 hours managing the project (conservative estimate), you've "paid yourself" $4,500 to manage the project. Add permit fees ($500-$2,000), lost bulk pricing discounts ($1,500-$3,000), and project insurance ($2,000-$5,000), and your "savings" disappear while assuming all risk and stress.
Payment Structures: How Each Gets Paid
How You Pay a General Contractor:
| Payment Stage | Typical Amount | When Due | What It Covers |
|---|---|---|---|
| Deposit | 10-20% | Contract signing | Material deposits, initial planning |
| Start of Work | 25-30% | First day of construction | Labor, materials arriving |
| Rough-In Complete | 25-30% | Framing, plumbing, electrical rough-in done | Structural work, systems installation |
| Substantial Completion | 20-25% | Project 90% complete, functional | Finishing work, final fixtures |
| Final Payment | 5-10% | Project fully complete, final walkthrough | Punch list items, final cleanup |
How General Contractors Pay Subcontractors:
General contractors typically pay subcontractors upon completion of their portion of work and passing inspections. This creates accountability - subcontractors know they won't get paid until their work passes quality and code inspections.
| Subcontractor Type | Typical Payment Timing | Why This Matters |
|---|---|---|
| Electrician | 50% after rough-in inspection, 50% after final inspection | Ensures they return for trim-out work |
| Plumber | 50% after rough-in inspection, 50% after fixture installation | Guarantees completion of finish work |
| HVAC | 50% after rough-in, 50% after system testing | Ensures system operates correctly |
| Drywall | Payment upon completion and GC approval | Quality control before painting |
| Painter | Payment upon completion and homeowner approval | Ensures finish quality |
Common Scenarios: GC vs Subcontractor Decision
Scenario 1: Simple Painting Project
Best Choice: Hire painter directly
Why: Single-trade, no permits required, minimal coordination, easy to inspect quality
Potential Savings: 15-25% GC markup ($300-$600 on $2,500 paint job)
Scenario 2: Kitchen Remodel
Best Choice: Hire general contractor
Why: Requires 8-12 trades (demolition, plumbing, electrical, drywall, cabinets, countertops, flooring, painting), complex permit process, strict trade sequencing, coordination intensive
Value of GC: Saves 100-200 hours of your time, provides warranty, handles permits, manages all coordination
Scenario 3: Bathroom Remodel
Best Choice: Hire general contractor (for most homeowners)
Why: Requires 6-8 trades, plumbing/electrical permits, waterproofing critical, tile work timing-sensitive, fixture coordination essential
Alternative: Experienced DIYers might hire plumber and electrician separately, do other work themselves
Scenario 4: Room Addition
Best Choice: Hire general contractor (mandatory for most)
Why: Requires foundation, framing, roofing, electrical, plumbing, HVAC, insulation, drywall, finishing - extremely complex permitting, structural engineering, multiple inspections
Risk Factor: Structural work requires expertise - mistakes are costly and potentially dangerous
Scenario 5: Flooring Installation
Best Choice: Hire flooring installer directly
Why: Single-trade, typically no permits, easy quality inspection, straightforward scheduling
Potential Savings: 15-25% GC markup ($750-$1,500 on $6,000 flooring project)
Red Flags: Problems to Watch For
Red Flags with General Contractors:
- 🚩 No Written Contract: Legitimate GCs always provide detailed written contracts
- 🚩 Large Upfront Payment: More than 20% deposit is suspicious
- 🚩 No Insurance Proof: Won't provide certificate of insurance (COI)
- 🚩 Cash-Only Payments: Insists on cash, avoids paper trail
- 🚩 No References: Can't provide recent project references
- 🚩 Vague Timeline: Won't commit to specific start/end dates
- 🚩 Unlicensed Subcontractors: Uses unlicensed electricians, plumbers
- 🚩 No Permit Plans: Plans to skip required permits to "save money"
Red Flags with Subcontractors (When Hiring Direct):
- 🚩 No Trade License: Electrician/plumber/HVAC tech without required Texas license
- 🚩 Won't Pull Permits: Suggests skipping permits to avoid inspections
- 🚩 All Cash Business: Only accepts cash, no invoices or receipts
- 🚩 No Insurance: Can't provide proof of liability insurance
- 🚩 Lowest Bid by Far: Significantly cheaper than other quotes (usually means corners being cut)
- 🚩 Incomplete Work: Leaves jobs partially finished, moves to next job
- 🚩 No Written Estimate: Verbal estimates only, no contract
- 🚩 Bad Reviews: Multiple negative reviews about quality or communication
Questions to Ask General Contractors
When interviewing general contractors, ask these questions about their subcontractor relationships:
- How do you select subcontractors?
- Good answer: "We use the same licensed, insured subcontractors we've worked with for years. We verify licenses, insurance, and references before hiring anyone."
- Bad answer: "We find whoever's available and cheapest."
- Can you provide a list of subcontractors you'll use?
- Good answer: "Yes, here's our typical subcontractor list with their licenses and insurance information."
- Bad answer: "We decide that later" or refuses to disclose
- How do you handle subcontractor problems?
- Good answer: "We inspect all work daily. If there's a problem, we require immediate correction at no additional cost to you. We're responsible for all subcontractor work."
- Bad answer: "You'd need to deal directly with the subcontractor."
- What happens if a subcontractor doesn't show up?
- Good answer: "We have backup subcontractors for each trade and will immediately find a replacement to keep the project on schedule."
- Bad answer: "We'd have to wait until they're available again."
- Who pays the subcontractors - you or me?
- Good answer: "We pay all subcontractors directly. You only pay us according to our contract milestones."
- Bad answer: "You'll need to pay them directly" (red flag - this defeats the purpose of hiring a GC)
Houston-Specific Considerations
Houston Climate Challenges:
Houston's hot, humid climate creates specific requirements for certain trades that your general contractor must coordinate:
- HVAC Sizing: Houston requires larger AC units (often 2x what northern climates need). Your GC ensures HVAC subcontractor properly calculates load.
- Moisture Control: Foundation work, waterproofing, and drainage are critical. GC coordinates foundation and concrete subcontractors carefully.
- Mold Prevention: Proper ventilation and moisture barriers essential. GC ensures insulation and HVAC subcontractors coordinate.
- Hurricane Preparation: Roof and window installation must meet wind load requirements. GC verifies roofer follows code.
Houston Permit Requirements:
Houston requires permits for most projects involving structural, electrical, plumbing, or mechanical work. A general contractor handles all permit coordination that would otherwise fall on you:
| Work Type | Required Permit | Who Handles It |
|---|---|---|
| Structural Changes | Building Permit | GC obtains and manages |
| Electrical Work | Electrical Permit | GC obtains, electrician pulls |
| Plumbing Work | Plumbing Permit | GC obtains, plumber pulls |
| HVAC Work | Mechanical Permit | GC obtains, HVAC tech pulls |
| Demolition | Demolition Permit | GC obtains and manages |
Making Your Decision: Worksheet
Use this worksheet to decide whether to hire a general contractor or manage subcontractors yourself:
Construction Experience (Answer Yes/No)
- □ I have managed construction projects before
- □ I understand building codes and permit requirements
- □ I know the proper sequence of construction trades
- □ I can identify quality workmanship vs. poor work
- □ I have existing relationships with licensed subcontractors
Scoring: 0-2 "Yes" answers = Hire a GC | 3-4 "Yes" answers = Consider managing yourself | 5 "Yes" answers = You can manage subcontractors
Time Availability (Answer Yes/No)
- □ I can dedicate 2-4 hours per day to managing the project
- □ I'm available during business hours to meet inspectors
- □ I can visit the job site daily
- □ I have time to research and interview multiple subcontractors
- □ I can handle permit applications and inspection scheduling
Scoring: 0-2 "Yes" answers = Hire a GC | 3-4 "Yes" answers = Consider managing yourself | 5 "Yes" answers = You have time to manage
Project Complexity (Answer Yes/No)
- □ Project requires structural changes
- □ Project needs multiple trade permits (electrical, plumbing, mechanical)
- □ Project involves 5+ different subcontractors
- □ Work requires trade coordination (one trade depends on another completing first)
- □ Project has strict timeline requirements
Scoring: 3-5 "Yes" answers = Hire a GC | 2 "Yes" answers = Consider your experience/time | 0-1 "Yes" answers = You might manage yourself
Decision Framework
Hire a General Contractor If: You scored "Hire a GC" on two or more sections above. Most Houston homeowners benefit from general contractor expertise, especially for kitchen remodels, bathroom renovations, additions, or any project requiring multiple permits.
Consider Managing Yourself If: You scored "Consider managing yourself" or "You can manage" on all three sections AND your project is relatively simple (single-trade or minimal coordination required).
Get Started with Tell Projects
At Tell Projects, we serve as your general contractor, managing all subcontractors, permits, coordination, and quality control for your Houston home renovation. We've built relationships with licensed, insured subcontractors across all trades over 15+ years.
Ready to Discuss Your Project?
Schedule a free consultation to discuss your project scope, timeline, and budget. We'll explain exactly how we coordinate subcontractors and manage your project from start to finish.
(832) 591-7991