You should be discussing these questions with your architect, based on the documents and instruction to bidders. If the instruction to bidders calls for a lump sum bid, then that's what they will do. In that case, every bid is an apples to apples comparison with other bids (assuming they all followed the instruction to bidders).

In a lump sum bid, the bidder(s) propose to do all the work listed in the documents for the proposed lump sum. Period.

There is no break down, unless the bidder wants to include one. You track the progress of the project and make payments based on "percentage complete" reported by the builder.

Allowances are a different matter and they should be carefully explained in the documents.

As to the contract for construction, what has your architect proposed as part of the instruction to bidders? It's normally included in those documents, so that all bidders respond in the same manner.

Having an attorney review documents is always a good idea. Talking with your architect may be an even better idea in this case. Good luck on your project.

I would never start any project that is so involved and expensive without having a RE lawyer reviewing the documents. GC's create contracts that protect them.

Not all General Contractors provide the same quality of craftsmanship, or prompt service. With your architect visit past projects of your General Contractor candidates to see their level of craftsmanship and talk to the home owners to see what their experience was.

Thanks guys, very helpful comments.

live_wire_oak, in fact, my architect did get a GC to give a preliminary estimate on our design. The preliminary ball park figure came in very high, so we had to make a few tweaks to reign in cost (e.g. using cable railings instead of glass railings cut railing cost by > 50%; having radiant floor heating only downstairs instead of whole house, not finishing up the 5th bedroom bath and using that as a gym instead etc. etc.)

For me and my spouse, who both have demanding full time jobs, it sounds like going with a lump sum fixed price is the way to go. We may end up paying more but at least I won't drive myself crazy getting into all the invoices and figuring out time & material costs, etc.

Also, I'll give my RE lawyer a call -- good advice to have someone review the agreement before I sign on the dotted line.

Thanks again!

When we renovated our condo we did a cost plus. I'm sorry we did because as someone else alluded to, it was then so easy to do the "as long as you're putting this in, can you please..." We went way over budget. Our only saving grace was that was in 2010 when prices were in the toilet for everything, so we got top quality and were able to sell at a nice profit this past May.

Personally, I would never bid a lump sum remodeling contract, because you never know what you are going to find once you open up the walls. I suppose the contractor could build in a huge contingency factor into the lump sum, but then you may be paying a premium for certainty.

In any case, if the local building market is hot, the contractors may not want to deal with it, even if the contract is written with a lot of contingency clauses. You may have to have some form of cost plus/time and materials agreement to get an offer.

And, I guarantee, you will "drive yourself crazy" with all the details. There is no way around that no matter what system you use.

what is a mcm home?

Mid century modern

When an architect prepares the documents for bidding he/she should include Instructions to Bidders with a bid form, a full set of drawings, specifications on the sheets or separate, and some kind of standard contract form with any special conditions or requirements. There should be an Allowance section that describes the allowance materials and states the dollar amounts to be included in the bid.

Allowing the contractors to propose their own contracts and allowance amounts will prevent you from being able to compare the bids without a lot of work and phone calls. If a contractor asked you a question during the bid period you should send the answer to all of the bidders. All bids should be due on the same date. If the bid date is changed it should change for all bidders and not at the last minute.

This should all be the responsibility of your architect.

I agree that renovation lump sum contracts can be difficult to enforce especially if they have allowances. Allowances are small Cost of the Work Plus a Fee contracts that are bought out with no cost limit from the subs the GC has already hired. It is often an expensive way to buy something. Do not include labor in an Allowance and provide unit prices and include fixtures model numbers and quantities when possible.

I've always wanted to visit Design World but no one seems to know where it is.