They provided an "estimate" unfortunately not a guarantee. Someone else (either yourself or the GC) should have double checked the "estimate". I know for the 15 years I put in in a lumberyard that they qualify that on their estimates, and believe me I had contractors upset about the same issue on more than one occasion.

As Millworkman says, if the lumber expense was an estimate and not a fixed cost then that's what it is. If it were me I'd have a sit down discussion with the builder, find out what went so wrong, and identify a strategy to get the project back on budget and keep it there. So much in residential construction depends on the type of construction contract the owner has with the builder. If the contract is a fixed cost/lump sum, then the owner has assurance of the ultimate cost. Other types of contracts such as time and materials or flat fee mean that labor, materials and fee expenses are not fixed. Good luck on your project.

Thank you. The builder stated that he spoke with the lumber yard and that they admitted that they didn't bid the job properly. We do not have a fixed contract and I do understand overages... But for a large (the largest here in our area) lumber yard, to have a program that puts in every board to give an accurate estimate to be 33% off is bad business, IMO.

I definitely agree but at the end of the day it is still an "estimate" and states that they are not responsible for the quantities. If they have admitted they did not do the bid properly hopefully you get some worthwhile satisfaction from them, but at the end of the day that will be by goodwill and not a requirement.

I don't exactly agree, the small print that lumber yards put in protect them from contractual disputes. It does nothing to protect them or your builder from negligence. If the bid was obviously too low and a review by any knowledgeable party should have raised questions then they are quite possibly negligent, you have a simple detrimental reliance case. A case you will not win for small amounts, explainable overrages, or substantially correct bids. However, your bid might be off enough to win. Again though, you are talking a serious and costly law suit, so almost any other option is preferable and you have to ask yourself whether a legal option is really worth the trouble. I wouldn't bother unless it is a significant amount.

Edit: just to clarify, they are allowed to make mistakes in an estimate, just not unreasonable mistakes. The real hard part is finding the line between reasonable and not.

I would have thought the builder would question it, particularly if it's nearly 35% too low. That should have raised some red flags.

This is a BUILDER issue, not a lumber yard estimate issue. Someone experienced and on top of things would have a WTF moment and called and got that fixed. Not a good omen for things to come.

How did you choose this builder and why?

Sounds to me like the homeowner is paying the bills. Are you self GC'ing the project?

And bry I meant I agree that 35% is inexcusable but SOMEONE outside of the lumberyard needs to verify the list period. Any lumber list off by 35% should have raised a red flag with the builder if not the lumberyard as they generally have a second set of eyes put on it as well.

No, we are not self GC'ing. We have a builder, who we hired after a long interview process (prior to starting plans), several references, and he built most of the homes in the area. He has a very high reputation and is not a fly by night builder.

We are GC-ing our build. When we received our lumber package bid, we went through line by line to assure it was correct. It wasn't. They gave us a lot of excuses - new person, new software, etc. They re-did the bid, but we wound up going with a different yard. Not sure what you can do at this point, except sit down with your builder and see if there's anything you can change moving forward to off-set the unexpected price increase in the lumber package. I know you hired a builder for a reason, but we've learned that it's paramount to go through everything thoroughly. No one cares about your money and your build like you do. Best of luck!

Give us some numbers.

House sq ft ....

estimated...

actual...

Generally You can easily tell when bid is too low to be true.

When you find a commodity item like lumber for $66 when you know it should be $100, you know that it's either seconds, or someone can't count. That someone is the builder. Who doesn't double check the lumber yard's takeoff?? Well, I guess someone who's pocket doesn't pay that $33.

Is there a reason you didn't go with a fixed price builder? Maybe this guy lowballed his estimate to build, and the other (realistic) quotes were 33% higher?

Was the list used to bid simply wrong? Or is it 100% attributable to price increases? The lumber yard gives a 30 day limit to quotes AFAIK, after that you're a fool not to get the list re-bid. Lumber can be volatile, like trying to buy 1/2" cdx plywood after a large hurricane hits.

Who did the material take-off? The builder or the yard? If the yard, the builder is still partly responsible, someone should eyeball the list against the plans to avoid the three-wall underbid scenario.

Casey

After meeting with the builder last night, turns out that the bid WAS actually redone at the request of our builder because it was too low. My SO apparently knew, but I didn't. The admission of wrong doing yesterday was made by the salesman as a general cop-out, I believe, so at this point, we're still waiting to have a meeting with the manager of the yard to figure out exactly what went wrong.

Thanks everyone for your thoughts and recommendations. Ecochran01 - we'll definitely be more vigilant about double checking things from here out. Sophie, our builder WAS hired for a reason, and if you'll read my post I stated our builder was hired before we even drew up plans, thus his bid being the ONLY bid we looked at. YOU may not prefer that method, and that's fine. I'm not here for advice on hiring builders, or to answer questions that do not matter at this point.

I would be paying attention to the fairness and accuracy of the final price rather than what caused the error. In the end, it would be difficult to assess any damages if the final price is fair and accurate and you only didn't have advance notice of the true cost of the lumber .

If you had had advance notice of the true lumber price, what would you have done, reduced the size of the house, used a different supplier, increased your loan or accepted it?

JDS, we discussed that very thing yesterday. We would have most likely just accepted it. But we would have had to change some numbers around to make it work in budget. Due to this, moving forward, there will need be sacrifices made in other areas, in order to make it all work.

To add, I think what is bothering me the most at this point is not knowing exactly why the discrepancy exists. Hopefully we'll get some answers in the coming days to help with my anxiety over the situation.

htwo82,

I think your words were so harsh to Sophie. He is right in some degrees. I almost have the same problem as yours. But I, was finally picked fixed contract with different builder. Not many "honest" builders are out there as you thought. I caught few before signed contract.

I agree with JDS that if you have time, it might be worth getting a quote from another yard. It helps to have comparisons and to put all the numbers in perspective. Also, another big factor in our lumber yard decision was customer service. The yard we went with was slightly more expensive, but their customer service far exceeded the yard whose quote was incorrect the first go around. I know you have a builder who is going to be dealing directly with the lumber yard, but just some more food for thought.

I would find another supplier if at all possible.