How to Compare Contractor Bids on a House Build

The way to compare contractor bids is to stop comparing the totals and start comparing the scope, because the number on the cover page is an answer to a question each builder wrote for themselves, and until all three of them have answered the same question you are not looking at three prices for one house, you are looking at three different houses. So the method is to rebuild every bid onto one common list of systems, mark the lines that are missing or carried as an allowance, and then look at whatever gap survives that exercise, which tends to be a smaller and far more useful number than the one you started with.

Why two honest bids on the same house come back far apart

A bid is priced against your drawings plus a stack of assumptions, and anything the drawings do not settle, the builder has to settle on their own in order to put a number on it. Finish level is the big one. Using our own cost engine on Ulster County pricing, a standard-finish build runs about $206 to $270 a square foot all in, and a custom-finish version of the same footprint runs $275 to $410, so on an 1,800 square foot house that is roughly $370k to $485k against $495k to $735k. If one builder read your drawings as builder-grade and another read the same drawings as semi-custom, the two of them can land more than a hundred and fifty thousand dollars apart while both are being perfectly straight with you about the house they priced.

The site does the same thing. A slab on a flat, clear lot is the baseline in that engine; a full basement instead adds roughly $31 to $50 a square foot at Ulster pricing, a steep or ledge-rock site adds $22 to $44, and pouring the foundation and doing the site work in winter adds another $2.90 to $4.10. None of those are hidden costs. They are decisions, and if the bid documents do not make the decision, the bid makes it for you.

How to compare contractor bids, line by line

Make one column with the systems in it and force every bid into that column. The breakdown our estimator uses splits a build into site work, foundation, framing, envelope, plumbing, electrical, HVAC, insulation, interior finishes, and millwork and cabinetry, and at Ulster County standard-finish pricing those run about $7 to $11, $17 to $23, $26 to $32, $32 to $41, $17 to $20, $13 to $17, $15 to $18, $7 to $9, $28 to $37, and $11 to $17 per square foot respectively. Those are not your build's numbers, and they move with the county and the finish level, but they give you a shape to check a bid against, and a line that comes in at half or double what the shape says is a line worth a phone call rather than a line worth an assumption.

Two things fall out of the exercise immediately. The first is holes: a system somebody did not price at all, usually because they assumed it was somebody else's problem, which is how a house ends up with two septic bids and no well bid. The second is that the bids stop being comparable on total and start being comparable on the handful of lines where they genuinely disagree, and that is the conversation you actually wanted to have.

The three places the spread usually lives

Site work. The baseline assumes a flat, clear lot with the utilities close by, and raw land in the Hudson Valley frequently is not that. Driveway length, ledge, fill, a well of unknown depth and a septic system sized by the perc test are the costs that swing hardest between two bids on the same parcel, and we wrote up what it actually costs to make raw land buildable if you want the longer version. If your bids disagree here, get unit prices in writing for rock removal, imported fill and extra footing depth, so the disagreement resolves against a measured quantity later rather than against a memory of a conversation.

Interior finishes and millwork. These are the two lines that hold most of the allowances, and an allowance is not a price, it is a placeholder with a number stapled to it. An allowance attached to a real specification, a named window series, a cabinet line, a tile budget per square foot, is a useful placeholder. An allowance that just says "kitchen, $30,000" is a promise to have an argument in eight months.

Permits, design, engineering and contingency. In the same NAHB-weighted breakdown, permits, design and engineering come to about 9 percent of hard construction cost and contingency another 6, so roughly fifteen cents of every dollar goes to things that produce no square footage. Plenty of contractor bids exclude some or all of that, which is legitimate, and it still has to live somewhere in your number.

What to read before you sign

Read the exclusions page before the price page. Check whether allowances carry a specification. Confirm who pulls the permit and who is responsible for engaging any engineer whose stamp the town will ask for. Line the payment schedule up against your construction lender's draw schedule, since the bank releases money against completed and inspected work and a front-loaded payment schedule can put you out of pocket in month three. Get the change order process in writing, priced before approval rather than after. And settle what review path the project is on before any of it, because whether a build is as-of-right or has to sit in front of a board is a town-by-town decision that moves both the fee and the calendar; the districts, lot minimums and setbacks for all twenty Ulster municipalities are on our Ulster County zoning pages, and the cost-to-build breakdown for the county carries the per-system figures used above.

How we handle it

We work as both designer and owner's rep, which means we figure out what you are able to build, design it, price it out, and then stay on through construction as your representative, and bid leveling is a big part of that middle stretch. The reason we can price a scheme before it goes out to bid, rather than after the bids come back and the number is somebody else's to explain, is that we run on our own software, Aldo, an operating system for residential construction that carries the zoning read, the feasibility and the build-cost estimate on a real parcel, so the owner's number and the builder's number are arguing about the same house from the start.

Everything here is decision-support rather than a quote or a professional opinion. The per-square-foot figures describe a typical build in one county at one finish level, your bids will describe yours, and zoning, fee schedules and code adoptions change; verify anything that matters with the town building department and with a contractor's actual proposal before you commit money to it.