How much would it cost to fix this kitchen? It depends on the level to which you want to renovate it. You should make the decision, not your contractor.

Estimating the cost of repairs is one of the most difficult parts of this business. You just have to learn this part of the business yourself if you want to redevelop houses.

There are systems available to help with estimating repairs, but your contractor is probably the most unreliable one. Here are a few reasons why you shouldn’t rely on your contractor for your repair estimate.

• It’s not your contractor’s money; it’s yours.
  My experience with contractors tells me they are very good at fixing things, but they are not necessarily good at running a business. They rely on cash flow—specifically your cash flow—and seldom plan more than one job ahead of today. (As Suna mentioned the other day, we’ve even had one contractor go homeless in the middle of a project and squat in our renovation.) And they have a responsibility to their families and employees that trumps their responsibility to you. That said, as a rule, contractors want to do a good job and see themselves as hardworking, honest people.

• They really want the work and know you want to save money where possible.
  This situation leads to two conflicts of interest.
  • They may underbid the project to get the work.
    I recently had a contractor submit a very low bid for a job. When I went over the statement of work with him, he had left more than half of the items out of the bid. It may have been a simple oversight, but he may have intended to charge a fee per “change order” to get the rest of the work done, too.
  • They may assume you want to use the cheapest materials and methods available.
    Contractors, even the ones who claim to specialize in “high-end renovations,” will cut corners on methods and materials when they can. You have to know what you need and what you’re paying for. Then you have to make sure you still make money at the end of the project. Saving a nickel on cheaper materials can cost you a dollar in resale value. Just remember that the opposite is not necessarily true. It’s very easy to over improve if you don’t know the market.

Solution

The more detailed your statement of work, the better of you are. The model numbers of the doors are not specified here because they had already been purchased but not used on another project.

It takes time to learn to do a valid repair estimate. But what will save your bacon is to have a detailed scope of work (SoW) for the project. It should list every task you want to have done as a separate line item:

• Paint the exterior walls and soffits Muslin (SW6031)
• Paint the exterior facia and window trim Craft Paper (SW6125)
• Replace the front door with a JELD-WEN 34 in. x 80 in. Craftsman 6-Lite Painted Premium Steel Prehung Front Door with Brickmould (Home Depot Model #THDJW182500036, Internet #204317376)

Notice that I provided paint codes and model numbers. There can be no room for confusion when you are this detailed, and you should provide this level of detail for everything you want done. If you do, you’re in charge of your project, not your contractor.

As you go through the project, you know when each line item is done and ready for payment. You also know if your contractor substituted materials or changed pricing without your approval.

But there are times when the bid is an estimate, and you have to recognize those times and be somewhat flexible. For example, we’re having custom cabinets built for one of our projects. My contractor gave me an “updated” SoW to reflect the pricing he got from the cabinet maker. That pricing came in at almost double the GC’s bid, and he had “helpfully” changed the bid price to reflect the sub’s bid. We had a long discussion about helping. We decided to use custom cabinetry only in the kitchen and master bath and to use prefab cabinetry of a similar design from Lowe’s in the other rooms. We are still over budget (I kept the original numbers so we could track the actual overage), but we are much closer to the original bid than we would have been putting custom cabinets throughout the project. More importantly, I know how much and why we are over budget, because I didn’t use the “helpful” updated numbers.

Isn’t it funny? He didn’t think it would be helpful to change the original bid in places where he actually came in under budget.