As a homeowner you know what you want done for your home. You have found images or did a rendering of your vision and are now ready to get bids on your home improvement project. The best strategy is to prepare a spreadsheet so as a homeowner you can compare the bids beside each other. Each proposal is going to look different even though the outcome may look the same. It isn’t just the total dollar amount as much as the process to complete the project. Cheaper is not always better! Professionalism matters when it is your highest valued asset!
Think of a renovation bid as more than just a price tag as your guide for the entire home renovation project. When you ask a contractor for a bid, you’re asking for a detailed proposal that outlines everything they plan to do, how much it will cost, and how long it will take. This document is your first real look at how a potential contractor operates and communicates. A one-page estimate is quite different from a comprehensive, multi-page bid that breaks down every aspect of the job, from demolition to the final coat of paint. A thorough bid shows that a contractor has taken the time to understand your project’s needs and complexities.
Plan to implement the details to your spreadsheet to compare line-item categories: demolition, materials, labor, permits, and a timeline for each step in the process towards completion. Ask for a blueprint to accompany each proposal to understand the depth of the contractor and their vision for the project compared to your vision.
Verify that the scope of work is identical, look for specific material brands, and compare timelines. Beware of the lowest bid, as it may hide inferior quality or future, expensive change orders that show up as a surprise later.
Do you notice discrepancies in the cost of materials, labor, and subcontractor fees? Is every contractor quoting the same tasks and materials for your project? One bid may have inferior materials and the reason for the quote on the renovation so much lower than the other bids. One bid may include demolition, while another contractor doesn’t come on the project until demolition is complete.
If you have a spreadsheet ready to fill in the blanks for comparison from the contractors, you can easily see if one contractor is quoting the same detailed list of tasks and materials. This will show their scope of work.
There are “hard costs” of the material and labor versus “soft costs” that may include the design fees, the project manager, and other supervisors working on your home renovation. Do all your bids break down the cost of major items including flooring, cabinets, plumbing, electrical placement, and painting?
When you begin collecting quotes, you’ll encounter two main types: labor-only and all-inclusive. A labor-only bid covers just the cost of the contractor’s work including their expertise and that of their team. With this bid, you’re responsible for sourcing and purchasing all the materials, from lumber and drywall to tiles and fixtures. An all-inclusive bid, on the other hand, bundles the cost of labor and all necessary materials into one price. The contractor handles all the procurement, which can save you a lot of time and hassle.
Each has its pros and cons, so it’s important to understand which bid aligns best with your project goals and how hands-on you want to be.
A contractor with experience will list product manufacturers, models, and the material they will need based on quality of products versus just a list of generic descriptions. It is important to check specifics.
Everything will need permits also including the HOA, inspections, and licensing requirements. Is that cost written into the bid? What is the estimated timeline for completion? There could be delays from availability which could increase your costs.
A few red flags:
- Bids, which are significantly lower than other contractors, could mean lower quality material will be used.
- Significantly higher bids may indicate fraud. Ask the contractor to spell out in detail all the costs so you can fill in your blueprint comparison sheet.
- Reputable contractors will take the time to explain their process to the homeowner and provide references for similar projects.
Additionally, contractors should be bonded, insured, and so should any subcontractors. Have you looked at their professional licensing, including any trade specific certifications or awards?
The contractor you choose will be someone you trust coming into your home and you feel confident speaking with on a regular basis. Is there a weekly/monthly updated communication plan to share the project markers with you? This is an important part of the bidding process. The homeowner needs to feel comfortable working with the selected contractor and can expect a verbal conversation with the supervisor of the project when asked by the homeowner.
