Contractor Bid Questions

[Stacey Blunt]

Ok, so me and my partner are doing our first rehab and are in the process of getting general and subcontractors into the single family home to give us bids on our renovations and improvements. We just got our first one back today and it came with a detailed outline of everything we asked to be considered in the project, but the only price that was included in the outline was the total price of $95,000...way over what we had budgeted. This is my first time dealing with contractors, but am I wrong in assuming that a good detailed bid should include the prices for each particular aspect of the project? I even tried to call and ask about the specifics and prices for each portion but he said that if he did that then the price of the bid would have to increase. The only information for specific price he would give me (after several failed attempts) was the cost of the HVAC portion of the work and that was substantially greater than what an HVAC subcontractor had bid! Should I decline this and keep my search open or try to work with this guy and come to an agreement on the numbers?

[Mitch VanDeveer]

@Stacey Blunt 

Good morning, I'm new to posting in the forums but not new to construction I've been a general contractor for over ten years and in the construction industry for almost 20.  First congratulations on your first rehab it takes a lot to make the jump.  

As far as your contractor, you need to have at least one preferably two more estimates to compare that price to. Try going to your local REI or reaching out on BP to find reference, you need to find a contractor that has a track record working with investors is a different business model than working for home owners. When a contractor is only giving you a single number for an entire scope of work they are hiding an extremely high mark up and don't want you to be able to shop there prices. You are correct in assuming that a good contractor would give you a detailed estimate break down, we call it a schedule of values. This breakdown is also how a good contractor invoices the client so you know what you're paying for. This breakdown is also how when you as an investor can value engineer, cut costs, when you project is legitimately over budget. Good luck and feel free the message me if you have any questions.