Money Matters: How to Differentiate Renovation Bids
If you’re getting multiple bids for a renovation project, odds are that the numbers won’t look anything alike. Some contractors provide lump sums while others break down their price by line; some are fixed cost will others opt for cost plus. It can get a little confusing when you’re looking to compare apples to apples but are faced with kiwis and cumquats! Here are a few tips to help you reconcile differences between bids:
- Check out the allowances. For example, is either contractor including tile material as an allowance? If so, did they use the same cost per square foot? Did one builder create an appliance budget based around a kitchen full of Wolf and Sub-Zero, while the other opted for GE? Assumptions your remodeler makes on the finishes you’ll choose come into play in the allowances and can account for some differences in price.
- Who has the most detailed specifications document? Typically, the builder with the more detailed specifications document has the more well thought out price (key word: typically). If your contractor’s spec includes everything from square feet of slab material needed for the master shower seat to number of door stops to be installed at the master bedroom, you’re covered. If the spec just says, “remodel master suite”, on the other hand? In the words of the Magic 8 Ball, “outlook unclear.”
- Have they both included necessary costs, like permits, protective products, dumpsters or trash boxes, and portalets?
- Do they both include general conditions? General conditions are a sort of “catch all” for small, unexpected costs during a project, like replacing broken outlet covers or buying bulbs that didn’t come with a decorative light fixture. Some contractors call for general conditions as low as 2% of the project cost, while others can go up to 10%.
- Note: most expensive doesn’t always mean most markup. If you’re worried that a contractor being the most expensive means he or she is ripping you off, that isn’t always the case. Like the other points have noted, more cost just might mean that your potential remodeler was more detailed in their scope of work or included higher allowances than other bidders. Of course, with any difference in price, big or small, the ultimate source of knowledge for your builder’s price is, well, your builder! Never hesitate to reach out if something doesn’t feel right. Most all contractors will be happy to review their pricing in depth, and anyone who doesn’t should be marked with a red flag.
If you have concerns or questions about renovation pricing, general conditions, markups, or anything else, don’t delay in giving us a call! We’re happy to walk you through our process and help you compare it to the processes of other Dallas remodelers.