If there are, then I would address them..if this is a real concern for the health of your property, then fix the real issue...drainage, foundation...... damaging the interior due to mud/dirt etc....then fix it....if its 99% cosmetic, then hell noOtherwise the tenant can go pound sand......they rented it "as is" with full disclosure and acceptance of the property...Don't like it?.....

Labor and material costs in the Bay Area are on average $200-$250 per SqFt for brand new construction, so that's where I'm at a loss - even for a rehab of 3k SqFt, it shouldn't be that cheap.

Keep in mind the premium can change depending on: actual replacement vs cash valueliability protection levelvandalism clause or notmedical expenses levelprotection of rent income or notwater backup or notrebuild code update or notdemolition removal or nottype of house (1 story vs 2-story), type of construction (e.g living space above garage) and materials (brick, stone vs. wood siding), or roofmultiline discountshistory with the provider, claims history and CLUE report/scorecredit score (maybe)property historydesired coverageetc.

I would add that I have used a reputable HML lender that does front some of the construction costs but of course, not all, 3 draws of 1/3 the construction costs were provided, the first draw within the first week of the loan(the subsequent draws required third-party inspection of course) and the draws specifically state they are for material, not any labor, so a first time HML investor needs to be prepared with additional liquid cash assets as you may have to float some of the construction contracts as you mentioned being that most contractors want up to half of the contract cost up front.

His bid was not broken down very well with materials.

You could do cosmetic flips, which is slapping on some paint on the walls etc.

Of course i always like the cheaper material. 

Thanks to BP, my son and I decided to install Allure flooring, new faucets, and other cosmetic updates.

We are redoing our kitchen, and lets say the cost is 60K+ 12K profit/Overhead (20%), includes cabinets, countertops, etc.Why do contractors calculate profit based on total cost including materials.

The liability exposure is materially higher and it's not the trade or business we're in.