I'm in San Jose and don't have an answer to your question. All the contractors I've spoken with seem crazy busy with large projects. Are they charging a lot because people can pay a lot? Yes. On the other hand, if people are willing to pay high prices, and they can fill their schedule with highly profitable projects, why would they charge less than the market will bear? There's just a lot of money floating around here, and when the contractors are doing custom homes and $300K kitchen remodels, they don't have much incentive to help me penny-pinch my $50K project.

Also high cost of living means higher labor costs too--we all have to deal with the crazy housing prices. This is very frustrating to me, because I'm trying to do a lot of labor-intensive structural work and cut costs on finishes (but there's only so cheap you can go with materials!).

As far as the price differences, the higher-priced firms seem to correspond with more professionalism and a better defined process (maybe just because they're bigger firms), but you're also paying for advertising and lots of hand-holding (maybe necessary or not) during the project.

If anyone has names of high-quality, cost-effective contractors in the bay area, I would love some recommendations!

I, too, am in a very high price area (although not as high as the Bay area). I found that smaller, family owned contractors who are from further away, say 30-50 miles, will charge considerably less than the local large firms. Now, to find these gems is not that easy because many don't need to advertise because they find their customers by word of mouth.
I found a great electrician and floor guy, so I asked them for recommendations. Another great source is a builder friend.

I think you can't avoid the up charge for your location but you can try to minimize it by finding contractors who don't charge as much. When I had two houses, Irvine and Newport Beach, I used to ask for estimate for both by using detailed plans and scope of work. Then I screened out the ones who inflated the most simply because of the address.

FYI, they all inflate the prices but not to the same percentage.

I know the contractors in our areas are busy because there have been so many floods from leaks. Basically the copper pipes in our entire county are failing due to water changes. It's so bad, the insurance companies are considering excluding water damages unless you have repiped with Pex.

I'm in the East Bay. I got multiple bids for our bathroom project two years ago. They ranged from $25,000 to $70,000. Based on the same plans and the same materials. I ended up getting five bids because I wasn't happy with the first three (one was the 70k and the other two didn't seem to have heard me at all when I read their bids).

For our upcoming kitchen remodel, I am using the same contractor who did our bathroom. I am not shopping at all. And I waited a year for him to be available for thus project. Because he does good work at a fair price.

All I can suggest is ask everyone you know for recommendations and get multiple bids. And be prepare to wait for a good contractor at a good price.

Another thing to realize is a lot of people want to have their work done in spring/summer. So costs go up. Time of year plays a big role. I'm in the East Bay and we started our remodel last June. We had an architect draw up the plans, got a GC, and both felt our budget was more than adequate for what we wanted (work, materials etc...) Then the bids came in and even going with the lowest of each trade we were looking at 40% over what our high end of the budget was. We were all stunned. Costs had skyrocketed. We thought of scrapping the whole remodel. After a lot of thought, we decided to start some work over the summer and put the majority of the work off till the fall in the hopes that competition for jobs would be less and costs would come down. And if they didn't, we'd reduce the scope considerably. Well with a lot of work from our GC in negotiating reasonable bids, and by waiting till the fall, costs did come way down. We had bids for our flooring that had a $40K difference in bids. It was insane. Same floor, different time of year. Tile had similar spreads.

Have your GC get multiple bids. Have your GC be very clear in the bids as to what you want and your budget. Also, if s/he has contacts with trades out towards Livermore/Tracy/Stockton area, they aren't as busy as those in the Bay Area, so often their bids are more reasonable and the quality of their work is just as good. And like crl said, be prepared to wait for a good contractor at a good price.

I agree with crl. If you find a good GC stick with him and don't shop. We had a good GC but he's booked 6 months out and we have to get the first floor remodeled. The insurance company won't wait another 6 months for us to finish the job. We already sat 4 months negotiating back and forth with adjuster.

Higher costs of bids isn't soley the function of zip codes. It's a domino effect. Firms in those areas simply have higher overheads as well. From office space, through insurance, through vehicle costs, licensing, etc. They're paying more too.

There's also the fact that higher residential costs equate to higher liability costs for the contractor that are not always taken up by that higher insurance premium. If a contractor gets a bad plumbing valve here, and it leaks briefly and destroys your sink cabinet and part of your flooring, that might add up to $2500 worth of damage on a 200K home that he has to cover because it won't even meet his insurance deductible.

In your location, with an average 1M home cost (have no idea if that's average or not) the same amount of damage is going to cost way more than $2500 because the cabinetmaker has a greater overhead, as does the flooring contractor, etc. and all of those higher associated costs were rolled into their prices from the beginning. So, it's double my cost here. But, he probably also has a higher deductible tbere too, and it still won't meet that minimum.

When you live in a high COL area, everyone has higher costs, and it's simply not reasonable to expect to not pay some difference because of your location.

Well, I think that what greendesigns says makes sense if you're comparing the Bay Area to Omaha. Except for the higher cost of insurance, everything else should be equal if you're comparing adjacent communities (ex. Newport Beach to Irvine or Sunnyvale to Saratoga (same contractors, same cost of materials, same general area, different demographic).

In a previous home in Northern Virginia we had an excellent, highly skilled plumber that admitted he inflated the cost between two adjacent towns. He said that one town had lots of money and they were willing to pay a premium for him. That was true, it was a very affluent town. Our town down the road was less expensive and his rate was lower.

We were getting the same expertise, just different prices.

Now we live near Atlanta. No one in our town hires anyone from the Atlanta area if they can help it. They are too expensive. They consider us country bumpkins not worthy of their time. We hire from the direction, a hundred miles from Atlanta. The prices are much more reasonable.

I just talked to another GC today and he explained to me why he would charge me more for Newport Beach vs. Lake Forest (next door). Our permits are 30% more expensive than other cities while Lake Forest waved all permit fees for remodels. That means thousands of dollars in savings for the people living in Lake Forest.

I don't have an issue with upcharge for these issues. That's completely understandable. I'm more comfortable with the GC because he's giving me facts and valid explanations.

Thanks everyone for your responses. I used a top notch licensed carpenter/framer/roofer (now a GC) about 15 years ago who did a major home addition for me, then graduated to building high end homes and doesn't have time for small kitchen jobs. He actually came to look at the job a few weeks ago, told me he was totally booked till September, but could squeeze in the job in 3-4 days early April, and to call him as soon as I got a permit, which I did 2 weeks ago. Since 2 weeks ago, he simply won't return my text messages or emails. I've emailed him that I'm willing to wait until he's available, but with no response. I can't figure out how to get him to at least call me back.

So I've started looking but so far have encountered two very high bids from contractors, who cannot start for 2-3 months more.

Someone else already made the suggestion but I'll add to it. To get a lower price, you may need to look for someone setup an hour's drive outside your city.

If you're looking for a lower cost, then try being up front with whoever you contact and ask them what they can offer for your budget. They will either turn the job prospect away or present you with a proposal.

One more thing to remember: all businesses have three things they can offer clients. Good price, high quality and fast service. However, any one business can only provide two of those. If you want quality at a good price, expect long lead times.

Some of my potential customers live on barrier islands. There is only one road on and off, the traffic can be nightmarish, and I've got to be paid for my time on that road. Home Depot is on the mainland and it's impossible to stock a truck for every conceivable scenario.

I understand that to hold a person's circumstances (living in a wealthy area) as a rebuttal to their argument that your prices are too high is the logical fallacy of relevance, ad hominem circumstantial, on my part. Irrational as it may be, I will never, ever, work for the wealthy for cheap. Poor folks, yeah, okay.

"...and to call him as soon as I got a permit,..."

Licensed professional contractors do not have homeowners get permits.

It depends upon the local government. My electrician and plumber are pulling their own permits. It's part of their bid. I was upfront about it from the start.

The law allows me, as the homeowner, to pull my own permit. The law doesn't require that I have a licensed GC. I have friend, who will be providing the floor and tile install, who is a GC and does kitchens and baths. She will provide me with expertise if I need it.

It's only in the last five years that my state even requires GC's to license. In my state, pretty much anyone can be a GC.

Mr. Corlett makes an excellent point. If you live in a difficult location, have a difficult project or happen to live in a municipality with difficult regulations or inspectors, any contractor will have to plan for it in their bid. That translates into more money. These are questions that you should ask your contractors. It helps you to understand their jobs.

"Licensed professional contractors do not have homeowners get permits."

In my city, the homeowner can get the permit. In fact, I did all the architectural drawings myself (to save $$$$) and paid a structural engineer for the specifications/drawings of the beams/footings. Also, there isn't anything difficult about my location or project. What's difficult is contractors who feel everyone has $$$$$$ to throw at projects, just because this area is full of people who work at Facebook, Apple, Google etc. Ideally, I would like to find a licensed, competent GC who is going to put in the beams/footings himself with a helper. I would be willing to pay such a team $1000/day + material cost, that's what my previous GC (the one who is super busy) told me it would cost.

Just because a homeowner can get a permit does not mean he should. Florida has a poster that they distribute to building departments specifically discouraging the practice, which is a violation of Florida law.

For comparison, the countertop featured in my "I've Found Yer Problem, Lady" thread was repaired for just under $1,000.00 in a day. It's considered maintenance, so no permit was required nor was a helper, and the material was minimal.

I'd suggest you become willing to pay what the market will bear, not what you think a GC and a helper should earn based on the suggestion of a guy with no skin in the game. If your previous GC had priced his jobs appropriately, he wouldn't be "super busy", he'd have a spot or two always available for folks willing to pay a premium.

C'mon, Sophie, there's nothing to this GCing business. Anyone can do it. Coupla TV shows, a chat board or two and you're good to go.

We are getting quotes for our kitchen remodel in San Jose. The quotes are so different from each other it's mind boggling. They are all within $10k of each other however one says $6700 for just granite fabrication and installation, the other says $3000. One wants $7k for kitchen hardwood floors and another is quoting $4k. The contractor we liked best wants us to pull our own permits but I'm not willing to do that. He is a little less expensive but I don't want to risk it. Medium sized kitchen is going to end up costing around $80k I think. Sigh...

Sounds about right. Allowances are just mini guesses of material costs inside the contract. You go over, you pay.Cost vs Value

On the opposite cost in an expensive town in NJ. We also ran into what we believe to be zip-code-related inflated quotes. Many of the contractors that regularly work in this area were significantly more expensive than the one guy we happened to know who usually doesn't focus his work in this area. We've done a fairly major project with him before, so we felt secure in his work despite the sizable difference in quote - without any past history we would have been VERY wary of going with someone who's bid was literally almost $80K less than all the others!

but since we trusted him, we went for it and I'm so glad we did because we like him, we work well with him, his quality of work is excellent AND we don't feel like we're getting gauged just because of where we live.

As a cabinetmaker, here is how I judge cost...

Any work that I do in the shop costs the same as any other work in the shop. My shop rate is a product of all of my production costs, overhead, insurances, etc, and profit. It doesn't matter if I'm building a 65k kitchen or a 1500 vanity... if I'm in the shop, same cost per hour.

Things that change the equation are location.... If I'm traveling more than an hour away from the shop, or in a strange location (many reasons) price creeps up. If we're dealing w/ a difficult or expensive material, price creeps up. Lots of change orders... price creeps up.

When I present a price to a client, I actually give them two prices... basically the high end low end pricing for my product. My clients and I typically agree on a price somewhere in the middle. High end options are things like... beaded inset vs. overlay, mantle style hood cabinet vs. microhood cabinet, frame and panel end panels vs. flat plywood, furniture foot details vs. standard toe space, etc...

As a business owner I'm constantly adjusting my shop rate, and bottom line. If the price of plywood goes up, so does my bid. If my insurance rates go up, so does my bid. If I find that most of my bids are received... I probably need to start charging a bit more. If I can't get a bid... probably need to come down. It's an ever changing animal.

The most frustrating thing is when you ask a homeowner what their budget is and they look at you like you have two heads. Any time homeowners were honest enough to tell me what they have to spend, things have worked out the best. Since I know my costs... and they have 15k to spend... They can pick from a bunch of options to get what they want for the 15k. And... because I'm crazy I guess... I usually give up a few things because the client is easy to work with...

My two cents... worth just that

-Kris

imgch, I'm in NJ too (northern). Would you be willing to message me your contractor info?

I am a fabricator. I have also, in a previous life as an engineer, solicited bids for projects ranging from a few thousand dollars for a small break room remodel to a couple of million dollars to install a $12 million printing press.

Here is my advice:

get several bids; preferably 5 or more. discard the lowest and the highest. meet with the remaining ones. If you get a bad feeling about any of the bidders throw them out. Note you can make it a lot more likely you'll get a bid if you spend the time to accurately describe what you want done. Don't ask for 10 "options".

After you narrow it down to 2 or 3 bidders review their bids IN DETAIL and meet with them to review questions and schedule. It is amazing to me how many people just look at the price and never actually read the details of a bid. When I run across such a person I withdraw my bid as that job is bound to be a problem.

Ask the bidder if he has specific recommendations. I've done lots of jobs for my regular GC customers that came to me because a granite shop selected by the homeowner botched a job or missed schedule by a mile.

a reasonable mark-up for a GC is 15%. Some of my largest builders bill their service as simply as cost plus 15%.

Even on something like the granite where the GC does little more than send the customer to me he gets a mark up because his payment from the customer (and possibly his profit on the job) for the whole job is at risk if I botch my part of it. (ditto for any other sub) when u use the GC's recommended subs you are getting the benefit of his experience knowing that a given sub is competent and will perform to schedule.