What Is a Punch List in Construction?
A punch list is part of the project closeout portion of the construction process in which a contractor prepares a document that lists any work that has not been completed, or not been completed correctly.
The punch list — also called a snag list, a deficiency list, and a punch out list — is created before the final inspection to outline all remaining work, and the contractor, project owner, or any other key stakeholders can add to it. A construction punch list should follow the terms of the original contract — for all the unaddressed items on the list, the contractor and customer will reach a mutual agreement before considering the project complete and ready for final payment. (Typically, the contract includes the right to withhold payment until all the items have been completed correctly.)
A construction punch list will often include the following items:
- Interior or exterior issues
- Incorrect installations, like flooring or cabinetry
- Mechanical issues related to thermostats, ductwork, and appliances
- Anything additional that was damaged during the course of the project, like a cracked driveway or flawed drywall
- Any unaddressed items outlined in the original contract
Many other things can be added to a punch list, but essentially, punch lists are limited to small or minor fixes that must be completed before a project is officially closed out. Since no building project will ever be perfect, contractors may make a distinction between reasonable flaws (minor, insignificant flaws that still meet contract specifications) and unreasonable flaws (errors that must be fixed). A punch list identifies unreasonable flaws for correction. Larger issues are usually addressed through a change order, which happens earlier in the construction process.
Punch lists help to justify retainage (also called retention), which refers to the amount of money that is deliberately withheld at the end of a construction project to ensure the contractor follows up on the punch list and completes all work. Additionally, retainage also helps to ensure that all work is on par with everything that was outlined and agreed upon in the contract. Usually, the retainage accounts for around five to ten percent of the original contract price.
Ultimately, the goal of all construction projects is to achieve zero items on their punch list — once this is the case, the construction project enters the substantial completion part of the project. This stage indicates the point at which both the project owner and contractor determine that all work is complete, and the project owner is able to occupy the space and use it for its intended purposes.
Zero Punch List in Construction
A zero punch list refers to a construction project that has no remaining items to address or fix at its conclusion.
The fewer repairs that need to be made, the more profitable a project is for the builder, and the happier customers will be. While punch lists are standard and honored by contractors, many aim for zero-punch projects in order to save time, hassle, and money in the long run. A few things can help builders accomplish this:
- Clear Contract Documents: Starting a project with complete documents that cover all specifications will reduce the likelihood of any work not meeting standards or being overlooked.
- Quality Control: Focus on strict quality control during the building process to help reduce errors and prevent damage. Setting high standards from the start means including zero-punch goals in your planning, and evaluating the quality of work at every stage of a project.
- Communication: Depending on the project, this may include communication with owners, architects, subcontractors, or other parties. Having owners on site regularly during building to view the process can help ensure their satisfaction along the way. Additionally, welcome feedback from any tradesperson working on the project to support the evaluation process and help catch minor issues before they become major.
When a punch list is at zero, the contractor and the project owner will reach a mutual agreement, stating that the project is complete and ready for a final payment, including all retainage amounts.
Punch Out Work in Construction
The term punch out work refers to remaining action items that must be completed before a project officially ends.
This term also describes the process of completing a punch list and indicating approximate timing of remaining tasks. Typically, the “punch out” is the last aspect of a construction project.
Construction Punch List Template
Track complete or remaining items and tasks, from materials and furnishings to plumbing and electrical installations. Use this template to keep all team members, contractors, and project owners in the loop on completed tasks relevant to your construction project, and indicate who is assigned to what tasks, as well as deadlines.
Download Construction Punch List Template
For additional free templates to help you manage and track your next construction project, visit this article with a variety of punch list templates that you can easily download and use for your next construction project involving punch lists.
Construction Punch List Process
There are two main parts of the punch list process: making it and addressing it. A contractor will create a punch list to address minor tweaks and major fixes, and set up a walkthrough with key stakeholders (project owner and other subcontractors).
During the walkthrough, all stakeholders point out any issues they notice and want to address before closing out the project. Typically, designers and architects join the walkthrough to review any changes to the original project and note things that should be changed or fixed. At this point, the contractor and relevant tradespeople address all variations or updates from the original specifications.
Once they outline all punch list items, everyone develops a plan to address remaining tasks. The contractor provides a general time estimate as to when the project owner can expect the project closeout.
Sometimes, a punch list and the time it takes to complete it can negatively affect a mechanic’s lien rights. The property owner grants legal rights that they place on a project to secure a guaranteed return on an underlying obligation. If that obligation is not met, the creditor can seize the asset.
The lien deadline starts as soon as the project hits substantial completion. Unfortunately, this deadline usually does not account for the punch list work. Many contractors run into this issue where they consider the mechanic’s lien deadline to extend much further than it does, meaning projects are due a lot sooner than expected.
It’s important to keep your punch list as short and concise as possible to eliminate running over your lien deadlines and getting into legal trouble. Additionally, you will save time and money in the long run by keeping your remaining work simple at the end of the project.
Construction Punch List Roles
There are many core people involved in the construction punch list process, including the project owner, the general contractor, subcontractors, and architects and designers.
Here’s a brief overview of each of the key roles in the construction punch list process:
- Project Owner: The project owner is responsible for inspecting any completed work and assessing it against what was outlined in the contract. They ask questions about how specific parts of the project were done and can add line items to the punch list. The project owner also uses the punch list to track project progress to ensure things keep moving.
- General Contractor: The general contractor’s main responsibility is to examine all key details and tasks associated with the project to ensure the project is complete thus far. Once the project owner develops the full punch list, the contractor reviews and prioritizes its items and creates a plan of action for the subcontractors to address the fixes and make the proper corrections.
- Subcontractors: The subcontractors are responsible for addressing the items on the list that they’ve been assigned to by the general contractor. The subcontractor is also responsible for following up and communicating changes in the project as they occur to keep the general contractor in the loop, so everything can be appropriately reflected in the final checklist.
- Architects and Designers: The architects and designers are responsible for confirming that all designs were built and followed through, based on the original contract specs.
For more information about the different roles and resources commonly associated with construction projects, read this helpful article on construction planning.
Improve the Construction Punch List Process
As you create your construction punch lists, keep these best practice tips in mind to help you make the process more efficient and seamless:
- Maintain a Rolling Checklist: Instead of waiting until the end of the project to start a punch list, add potential tasks as the project progresses. Use this running list to create workflows and set project standards so you can improve accountability across your team. Consider holding daily check-ins to run through this checklist and ensure work is staying on track and that you’re addressing all questions.
- Document and Photograph Everything: As your project continues, be sure to document every part of the process — and even take photographs, when necessary. This way, you can prevent having to redo work and justify why things were done the way they were. For more information on how to manage construction documentation, visit this construction project management article.
- Perform Regular Inspections: Throughout the life of your project, perform routine inspections to ensure you’re producing the highest quality work. Use the punch list format for your inspections so you can check in on all safety and quality measures during each job visit. That way, you can make fixes as issues arise, instead of waiting until the end to create a massive punch list.
- Use a Cloud-based Punch List: It’s extremely hard — and outdated — to track punch list items on paper. Using pen and paper leads to too many inefficiencies and errors, and severely hinders collaboration among stakeholders. Instead, create, track, and manage all of your punch lists using a cloud-based tool that enables real-time conversations in context of the work being done, as well as immediate updates that keeps everyone informed. You should be able to store all documentation in a central location that everyone can access. As the project progresses, all contractors, subcontractors, designers, and project owners will have visibility into progress.
- Assign People Specific Items to Manage: To ensure that all work gets done, assign every task on your running list to a specific team member and note deadlines to keep everyone accountable. One person (usually the general contractor) should be responsible for assigning line items and detailing exactly what needs to get done.
- Set a Budget: Construction projects are known to run over budget, so make sure you set a budget from the get-go, and stick to it. Staying on track leads to a plethora of benefits, including fewer cut corners and unnecessary scrambling, a reduction in conflicts, easier and faster project completion, and more. If you’re looking for more information on how to estimate and budget for your construction projects — and details on how this can greatly benefit your next project — read this comprehensive guide on construction cost estimating.
- Be Open to Feedback and Suggestions: Before you can check an item off of the punch list, everyone must agree that it is complete and ready to go. If a project owner isn’t satisfied, they are free to provide feedback until they feel that you’ve followed through on the deliverables. Don’t take anything personally. Welcome all feedback to ensure you leave a positive lasting impression on every after project completion.
Pitfalls to Avoid When Creating and Completing a Construction Punch List
As you work on a construction punch list, be wary of the potential pitfalls you may encounter, including the following:
- Complication with Lien Rights: Discussed above, you may hit your lien right deadlines sooner than expected. Keep an eye on this date, and keep your punch list manageable and doable within the specific timeframe.
- Lack of Open Communication: Communication is essential throughout the entirety of a construction project. When you run into an issue or roadblock that interrupts the original project plan, alert the contractor, project manager, and project owner immediately. That way, you can address problems as they arise, instead of leaving all of the fixes for the end of the project, which can delay it even further.
- Lack of Documentation: Having documents, contracts, and photos of your work helps you prove that you’re following through on your promises, and prevents additional work that wasn’t originally outlined in the contract specifications. Keep photographic proof of your work in case any unexpected damages or hiccups occur that cause pushback.
- Lack of Understanding: Familiarize yourself with every detail outlined in the contract so you know what’s coming down the line. To prevent having to do extra work or paying for items that are outside of the original scope of work, make sure you’re aware of and understand the contract from front to back.
- An Unclear Budget: Construction projects are notorious for going over budget, and this usually happens because you reach your budget just as many changes and fixes are identified. To avoid going over budget and accruing unforeseen expenses, set a clear budget from the start and stick to it as closely as possible. Allocate a certain portion of your budget to the punch list to eliminate unnecessary spending and keep your punch list moving quickly. Then, there will be fewer questions surrounding how to fund the punch list items.
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