How to pay your contractor: T&M vs. quote based pricing

[Sean Peters]

This is in regards to a new flip project I have started... 

There is not a ton of work to be done, but there is enough... Lots of small jobs like windows, flooring, installing cabinets.

So my question is: If you have a contractor that you know and trust, would you hire them based on paying for Time and Materials? Or should you always get multiple bids on jobs like installing windows or replacing siding.

My only concern is that I do not have any idea what this will end up costing in the end because I am not getting a "set" estimate for the job... Makes budgeting difficult. But on the flip side, my contractor has offered to do the work for a discounted rate compared to his usual because he wants my continued business relationship.. What should I do?

I look forward to hearing your feedback! Thanks!

[Aaron McGinnis]

I have a plaque sitting on my desk that says "No T&M Contracts"

It just doesn't work out... for anyone. Contractors get screwed very often by these kinds of agreements, and investors get screwed very often too.

There's a place and a time for T&M... it's on unique projects with deep pockets and totally unpredictable outcomes. Investment properties very rarely fall under this category, so there's no reason not to use hard bids.