Once your house plans are finalized, you’re ready for the most frustrating part of the construction business – getting prices! It sounds simple enough, to phone around for quotations, but comparison shopping in the construction business is quite different than shopping for other services. The key to simplifying the process is providing accurate, detailed information up front.
Having a good set of plans on hand is a must; it ensures that all contractors are bidding on exactly the same thing. The plans should clearly show all items required to complete the construction. At a minimum, you need a floor plan for each level, a foundation plan, a site plan, exterior elevations and a detailed wall section. If the design is unique, more blow-up plans and details are necessary. For special features, such as a freestanding fireplace or whirlpool bath, provide written specifications of the particular model.
The more detailed the drawings are, the less they are subject to interpretation, which minimizes confusion and errors in the bidding process. Using drawings which inaccurately represent what the owner really wants is one of the main causes of disputes during construction. Hand-drawn sketches on table napkins are not recommended!
To speed up the bidding process, provide each contractor with their own set of blueprints. If you are acting as your own project manager, without a general contractor, more copies of the blueprints will be needed for distribution to the various subtrades and material suppliers. Give the bidders a reasonable amount of time to prepare their prices, but stress that their quotes must be received by a firm deadline to be considered. If the scope of work changes during the bidding period, be sure to tell all bidders before the deadline.
Use the same deadline for all contractors and let them know that the bidding is competitive. This avoids the nuisance of contractors who continually phone back with a new and lower price just to get the job. More importantly, it ensures you get their best prices the first time around.
Occasionally, exceptions may have to be made to get the contractor you want. A contractor who is always busy is usually a good sign; it means his services are in demand. However, if no response is received after your third request for a quote, that’s probably a good indication of how they will respond to problems during construction.
Sometimes, experienced contractors can save you money by offering a cheaper solution, but beware of contractor substitutions that reduce their cost but not your price! For example, if a contractor wants to use vinyl windows rather than the specified wood windows because they are more readily available, make sure the cheaper cost is passed on to you. If you are willing to accept a cheaper alternative, either let them all bid on the substitution, or insist they bid on the specified product and negotiate a lower price afterwards with the successful contractor.
The hours spent requesting, discussing, receiving and scrutinizing bids will undoubtedly raise your blood pressure. Yet, it is the second most important task other than the actual construction. It can make or break your budget and schedule. When it comes to getting construction prices, always remember the old adage: “Let the buyer beware!”
WHAT’S INCLUDED?
When analyzing contractors’ prices, always ask: what’s included and what’s not? Cross check each quote with the bidding documents for accuracy and thoroughness.
Insist on written bids with breakdowns by major components, e.g. foundation, framing, finishes, roofing, site work. This makes it easier to compare bids and determine if cheaper materials are substituted.
Make it clear at the bidding stage who is responsible for what materials and labor. This avoids the incessant finger pointing during construction when disputes arise between subtrades.
If you receive a super low price, confirm what’s included and excluded. A low bid may mean the contractor doesn’t understand the work involved, especially with renovations. If there is real doubt, compare the estimated quantities of the material suppliers. Suppliers sometimes underestimate quantities to make their price more attractive, but will ask for many extras during construction resulting in costs you hadn’t anticipated.
Don’t be fooled by cheap estimates showing a single, lump sum, non-detailed, total package price. Ensure all the soft costs such as the building permit, liability insurance, workers’ compensation, warranty work and taxes are included.
