The Remodel Estimate Shot Up

[Freedom56]

Quote:

Originally Posted by DrRoy I know this comes down to a personal decision, but I just do not know what the right answer is. We have been working through a plan to remodel our family room and adjacent laundry room for nearly a year. Fairly big deal - vault the ceiling, redo fireplace, rearrange walls a bit, plumbing, electrical. Getting design work done and finding a contractor has been unexpectedly slow. We finally picked a builder (had to put $1900 down and paid $1500 for design earlier) and had an estimate of $52K for the job. There were allowances for various elements. Then we get into details - pick exact finishes, flooring, cabinetry, etc. We decide that we really like certain custom cabinetry that will add $7K. An electrician comes through to get details. He sees that we need an upgrade to our main grounding per code. The builder has to take all this and revise the estimate. We are expecting something close to $60K. It comes back at $80K. We are pretty stunned. Even areas that we did not make any changes to have gone up. I feel like the builder misled us with his "allowances". The issue is not if we can afford it, we can. The issue is if the project is just not worth the cost any more. We can make changes to reduce the cost, but then we are getting less, so the value issue does not really change. We have not figured out what we want to do. We can bite the bullet and get everything we want, pare back in various ways, or totally bail and forfeit the initial $. Any guidance for us?

Did you get at least 3 different quotes? Is the "builder" a general contractor or a company that actually does some work. For major projects, we normally get multiple quotes and deal with people actually doing the work instead of "general contractors" who tend to do nothing but subcontract the work and mark-up. If your price has shot up from $60K to $80K without starting the work, think of what will happen during the construction phase. I would stay away from companies that inflate that quickly.

[pb4uski]

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Originally Posted by kgtest ....I've heard comments like "man why are rich customers so cheap". ...

How do they think that those rich customers got "rich" to begin with? In part, by shopping wisely and making good value decisions.

[Teacher Terry]

Luckily my husband is very handy and can do the work himself. We completely remodeled our house inside and out for 70k. We gutted most rooms. We hired people for 10/hour to pull up carpet, removal of nails and staples. Also hired him a skilled assistant for 15/hour and it took them 4 months working full time. We didn’t move in until done. This was 6 years ago.

[Music Lover]

I became handy out of necessity, but in the long run it can save 10's of thousands. I can now afford to pay someone to do things, but I balk at the cost and still do most things myself.

[RobbieB]

If you can afford it do it. If it what you really want get it.

The value part comes in where if you get what you want here, can you afford something else that you really want ie is the family room going to cost you that trip to Spain?

[OldShooter]

No way to know from a distance, but here are some common project management issues:

A subcontractor who bids to win, planning to get well on the inevitable change orders.

Creeping Elegance; the compounding effect of adding nice-to-have things to the plan.

Scope Creep; a close cousin of creeping elegance, but viewed from the contractor's side: a customer who keeps adding scope to an already-priced project. You can steal a lot of salami by taking it in slices too thin to fight over. Eventually, though, the victim will insist on getting paid for the increased scope.

Aw S#its and I-Forgots: These almost inevitable (and still ahead of you) in a remodel and very predictable even in a clean start projects. Surprises do happen when walls get opened up and things do get missed when building up a quotation.

I suggest that you consider these budget-busters as you evaluate your plan. Maybe there is scope you can cut. Maybe your contractor is indeed dishonest. And certainly there are more cost increases ahead.


Edit; I forgot one: The Sunk Cost Fallacy; the money you have already spent is gone. Gone. Gone. Your decisions looking forward must be based on the future economics only. https://en.wikipedia.org/wiki/Sunk_cost

[Bamaman]

My family built a lake house (1979) and a 6600 square foot home in the city (1986). Both were on a actual cost plus 10% basis with contractors. We did all the shopping for materials and fixtures, and we paid all the bills. The contractor was paid weekly for their actual man hours worked.

We saved substantially by cleaning up the worksite daily, and we chased after building materials keeping carpenters on the job. We were very fortunate that things went very smoothly, and our contractor loved our taking the job administration off his back. You wouldn't believe how much you can save on cabinetry, plumbing fixtures, lighting and flooring when you're shopping for bargains.

There are also substantial savings that most anyone can do on renovation jobs--like tearing out walls, removing cabinets/flooring, painting and cleaning up the work site.

See if your contractor will do the job on a cost plus basis and allow you to pay bills and assist more. But leave him to do the heavy labor.

[W2R]

Quote:

Originally Posted by RobbieB If you can afford it do it. If it what you really want get it. The value part comes in where if you get what you want here, can you afford something else that you really want ie is the family room going to cost you that trip to Spain?

+10000000000000000

If you can afford to do it, do it!!! If I read you right, your post tells me that you know this renovation is something you really, really want, more than anything else you could use that money for.

If you don't do it, you'll be feeling morose about that for years. Eventually you might even feel so bad about it that you might move, and believe me, that costs a lot more than a renovation.

Let me cheer you on - - rah, rah, close your eyes and just DO it!!!

[DrRoy]

Quote:

Originally Posted by Freedom56 Did you get at least 3 different quotes? Is the "builder" a general contractor or a company that actually does some work. For major projects, we normally get multiple quotes and deal with people actually doing the work instead of "general contractors" who tend to do nothing but subcontract the work and mark-up. If your price has shot up from $60K to $80K without starting the work, think of what will happen during the construction phase. I would stay away from companies that inflate that quickly.

We did get 3 estimates. The chosen co does much work in house but subs out some, like electrical. They had the best initial estimate, but also have a strong reputation, are local to our exact city (which has quirky permit issues), and they were the best communicators in the bidding process.

[DrRoy]

Quote:

Originally Posted by RobbieB If you can afford it do it. If it what you really want get it. The value part comes in where if you get what you want here, can you afford something else that you really want ie is the family room going to cost you that trip to Spain?

As I mentioned, affordability is not really the issue. We can afford it, won't have to put something else off, I just had gotten comfortable with paying X + Y, and was hit by X + 3Y. We didn't get to FIRE by overpaying for anything.

Quote:

Originally Posted by W2R +10000000000000000 If you can afford to do it, do it!!! If I read you right, your post tells me that you know this renovation is something you really, really want, more than anything else you could use that money for. If you don't do it, you'll be feeling morose about that for years. Eventually you might even feel so bad about it that you might move, and believe me, that costs a lot more than a renovation. Let me cheer you on - - rah, rah, close your eyes and just DO it!!!

In part that is in our thinking. For ~10 years, we thought we would move at RE and build our first new house. When we did RE, we had some changes in our situation such that we did not want to move anymore, so the remodel is partly in place of the new house. Having the price go up is a mental violation of the last 35 years of LBYM. If feels very wrong to do, even though we have the $.

[RobbieB]

Well then the problem is only in your head eh? Well by all means, cheap out and put in those particle board cabinets. Then you'll see them the rest of your life.

C'mon now, be brave, trust in your wants and Blow That Dough -

[Freedom56]

Quote:

Originally Posted by DrRoy We did get 3 estimates. The chosen co does much work in house but subs out some, like electrical. They had the best initial estimate, but also have a strong reputation, are local to our exact city (which has quirky permit issues), and they were the best communicators in the bidding process.

I would negotiate the price down if you want to work with this builder. Many just price the work based on what they feel the customer is willing to pay. If the builder really wants the work, the price will come down. We have done over $220K of remodeling and improvements over the years (we bought our house new in 1995) and found that estimates vary quite a lot at least here in Southern California. We had a similar issue when we were building our pool/spa. I drew up a sketch of what we wanted and requested bids from several companies. The bids varied in range from $52K - $88K for the same basic pool/spa and decking. We were about to sign with a company that bid $55K but when it came to the contract signing the bid climbed up to $78K. We told the guy no thanks, and moved onto another company. We ended up paying about $56K.

[Bestwifeever]

Our just-now-finishing second floor remodeling came in as quoted but everything was in the estimate before the demo started. I held my breath during pre- and post- mujicipal inspections but nothing was addressed by the inspectors (who did acknowledge that an 1887 house could not be up to 2018 code). The carpenter will do a few more things beyond the estimate that DH wants (okayed by the remodeling company for him to work independently for us—had this work been under a change order the remodeling co would have charged a high percentage).

Same co did our downstairs five years ago and the stuff we added during the job pretty much doubled the bill, but what are you going to do? If you gad known the total at the beginning would you have gone ahead with this builder?

[Music Lover]

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Originally Posted by RobbieB Well then the problem is only in your head eh? Well by all means, cheap out and put in those particle board cabinets. Then you'll see them the rest of your life.

There is no reason to either cheap out or pay too much because good quality cabinets can be had at a fair price. Also, in most cases, cabinets come in standard sizes that vary by 3" so only one of the cabinets along a wall has to be custom made or altered to fit if you don't want a filler strip.

[pb4uski]

IMO there is nothing wrong with MDF cabinets (BTW, MDF is very different from particle board... it is denser, heavier and sturdier)... let's face it, once installed the cabinets just sit there.

We have MDF cabinets that have been moved twice... from showroom (we bought a display) to our summer home and then put them in storage for a few months and installed them in our current home... no problem. Only the boxes are MDF.... the frames, door and drawer fronts are solid maple.

That said, in our recent kitchen renovation we went with MDF boxes but upgraded the sink base cabinet to plywood at the recommendation of our cabinet guy since that is the cabinet that is most likely to be exposed to water.

[RobbieB]

Personally I'm done with MDF and particle board. I used them and I hate them. I will never use that stuff to build anything and I will never buy furniture with it ever again.

Solid wood or plywood only. No more composites. Yeah, it costs more but it's worth it.

[foxfirev5]

From my building days - Change orders are where the real money is made. After being shopped and detailed to death on the original quote the changes are going to have a premium. It's specially gratifying when a bean counter is involved. Drives them nuts but as a contractor you pretty much have the upper hand. In today's market this is the way it is. Period.

Today I leveled a foundation for my DS front porch. Quotes from contractors - 1500 and up depending on what they find -ie change order. We did the job for 120 in materials and 8 hours labor (2x4 hr). So the 1500 doesn't look too bad - however the below ground issues would easily have added another 1000.

[Ronstar]

Dr Roy - builders are generally low on “allowances”. I don’t know anyone who got what they wanted from the builder’s initial price. It’s best to pick your finishes up front and get solid costs on those. Then add in builder’s costs for demo, reconstruction, etc , and get to a good preliminary estimate. However, in a remodel project, there are usually issues that pop up that require additional work and materials to bring the project up to code - like the issue that your electrician raised.

I suspect that other issues will arise during construction that will raise the cost of the remodel even more.

[FreeBear]

I hate houses! Had to deal with 3 in the last 5 yrs...

Agree with the others that you should go through the old vs new (expensive) estimates line by line. You may decide you don't want to "gold plate" everything, but keep only your favorite items. Maybe you can pick you own subs for specific tasks or even do some of the demo or finishing.


If it is an older place and building inspectors are involved, I agree with folks that say you should be thinking 80-100K if you want to go ahead. Sure, your try to cut costs, but costs never seem to decrease when the wall open up and the inspectors start poking around.

A buddy of mine did a major whole house remodel, largely by himself and his wife. Subs only did the foundation & framing. Well, the inspector madated that he install a whole house fire alarm, with everything hard wired. Fortunately, he wired it himself and passed inspection. Another friend, not so handy, had to do the same thing, but had to shell out 10K to an installer.

Did I say I hate houses? Have to live somewhere...

[pb4uski]

Quote:

Originally Posted by RobbieB Personally I'm done with MDF and particle board. I used them and I hate them. I will never use that stuff to build anything and I will never buy furniture with it ever again. Solid wood or plywood only. No more composites. Yeah, it costs more but it's worth it.

Why do you hate MDF? Have you ever had a structural failure? I haven't but could see it is possible if you move the cabinets and are not careful enough. We could have gone with all plywood boxes for our recent kitchen renovation but I just don't see the value proposition as being compelling.

For furniture I agree... particle board is junk... MDF isn't much better... but furnture gets moved regularly so that is a big difference for me.