Earlier this year a gentleman stopped by the house to ask if he could give me a quote on trimming the trees in my yard – a fairly frequent event on my street, which has a lot of older trees.
I've been here 26 years, and I've talked to dozens of tree trimmers. So I pretty much knew what to expect as soon as he pulled in the driveway in his spotless pickup truck. The truck with the custom graphics, the chrome wheels, and the boat hitch on the back.
The gentleman got out wearing a safety vest and hardhat – both looked new, as did his neatly-pressed jeans.
As I suspected, his price was far above what I knew the work was worth. I thanked him and turned him down; the trees need trimmed, but I’m not going to make the guy’s boat payment to get it done.
How Much Should It Cost?
Luckily, I already knew what the tree-trimming job should cost.
Likewise, you need to know what your new home or remodeling project should cost before you hire a contractor, because there’s a difference – a big difference – between what some contractors charge, and what your project should cost.
A new home or a remodeling project is a unique, one-of-a-kind thing made from thousands of man-made and natural parts, cut to fit and assembled in the field by hand in frequently lousy weather. The whole thing is documented on drawings that are a fraction of the actual size and don’t include everything needed to build it.
So it’s no surprise that different contractors come up with wildly different prices for the same project. How can you know what it should really cost to build?
Know Exactly What You Want
Supposed I’d made “specifications” for my tree project - a list of which trees I wanted trimmed; how I wanted the cuttings dealt with; and how much clean up I wanted done at the end of the job. Now suppose I invited three tree trimming companies to bid on the job based on my specifications.
Do you think I’d get more accurate pricing? And if I were careful and complete about my specs and my choice of bidders, would those prices be competitive?
Three quotes on accurate and detailed specs would result in a very good idea of what a fair price for the job should be - you can't get that kind of assurance with just one price!
Plans, Specs, and More
Competitive bidding works the same way in new home and remodeling construction. Qualified contractors submitting bids on a well-defined project know that they've got to give their best price if they want to get the job.
Here are the six basic thing you must have to get your project ready for competitive bidding, so you can be sure you're getting the best price for your new home or remodeling project:
1) Complete, detailed plans
Your local building department doesn't require much to issue a building permit. All they want to know is whether the plans meet the building code, and the code is mostly about safety – not about what kind of countertops you want.
A set of "permit-ready" or "builder's" plans is missing a lot of what you need to get accurate and complete bids. You need far more information – especially drawings of the architectural details inside and outside of the house.
“Specs” aren't part of the drawings; drawings tell the contractor where things go, the specs tell them what those things are. The drawings will show a toilet in each bathroom, but the specs tell the contractor what kind of toilets you want. If you want a different toilet in the master bath than the kid’s bath, the specs spell that out.
Without specs, you’re leaving the decisions about the cost of fixtures and finishes up to the bidders. It's likely they'll put a relatively low number in the bid, which means increased costs for you later on.
3) Bid Invitation Letter
When are the bids due? What format should the bids be submitted in? Who do bidders call with questions? Where should the bids be turned in? How many bidders are expected?
These questions – and more – should be addressed in a bid invitation letter sent out to each bidder.
4) General Conditions
There are dozens of little issues to deal with on a construction project that have nothing to do with construction, but everything to do with the price.
Insurance is one, as are working hours; parking for subcontractors; change orders; quality assurance; dispute resolution; cleaning, and on and on. A “general conditions” document spells all this out.
5) Quality Bidders
An experienced, qualified contractor with a track record of success competing against two guys with a pickup truck and a magnetic door sign isn't going to get you an apples-to-apples comparison.
At the other end of the scale, the tree trimmer with the pressed jeans and boat hitch that I told you about before might have a bit more overhead to absorb than many others (and I suspect he’s more of a salesman than a tree trimmer anyway). Probably best to leave him off the list, too.
I’m constantly surprised by how often homeowners don’t check references. They can give you confidence in a contractor, but they can raise important red flags, too.
Where To Find Help
It seems overwhelming, getting all this information together and managing the bidding process. But consider your choices – clearly identify the details of your project up front, or risk overspending by thousands of dollars.
Chances are that help with all this is closer than you think. If you hired an Architect to design your project ask him if he offers this level of service. Many do, and would be more than happy to help manage the specification and bidding process for you.
But even if you take this on yourself, you’ll be much better off – and won’t pay for someone else’s boat in the process.
Need expert Residential Architectural advice for your new home or remodeling project? Contact Richard Taylor, AIA at Richard Taylor Architects to arrange a meeting or an online consultation.
Labels: Construction Cost, Custom Home Design, Home Remodeling and Addition Design