The Contractor Pricing Gap: Why Remodeling Quotes Vary So Wildly These Days

Imagine you’re ready to renovate your kitchen. You get quotes from a few different contractors, only to find that they’re significantly different. 

Believe it or not, this is pretty normal. While prices are assuredly up given labor cost increases and the ongoing tariff costs being passed on to consumers, shopping around for contractors has always been important to find the right price.

And you should almost expect quotes to vary, even for the same project.

“As a homeowner, it's up to you to truly understand the bids and get as much specific detail as possible in order to protect yourself from surprises down the road. This is much more important than price alone,” says Andrew Gardner, founder of Leap Properties in Houston.

By knowing why quotes differ and how to compare them fairly, you’ll find it easier to choose the right contractor for your unique situation. 

What causes quotes to vary

There are many different factors that go into a quote.

“Everything from the cost of the specific materials, the timeline of the project, how many people will be working on it, and how popular or established the contractor is will all impact a quote,” explains Andre Kazimierski, co-owner and president at HomeHero Roofing in Downers Grove, IL.

In many cases, the contractor’s size and reputation are what make the greatest difference. 

“Contractors who have larger companies and are well-established brands will often charge more than smaller or newer contractors because their brand name holds more weight,” Kazimierski says.

Materials can also have a significant impact on a quote, which is why the latest round of tariffs has hit the industry so hard.

“Lower quotes may involve cheaper materials and a shorter warranty. This might mean the quality won’t last, and the aesthetics won’t be as great,” says Kam Oveisy, founder and owner of Desire Basements in Richmond Hill, Ontario.

In addition, if your project involves electrical work, quote differences are almost guaranteed. That’s because electrical points like potlights, switches, outlets, smoke detectors, and LED lighting can vary greatly and depend on how a project is designed.

“A contractor may lowball the total amount with a contingency that says the number may increase when the electrical work actually begins,” Oveisy explains.

Joshua Kurz, founder of NumeralQ in Sweeny, TX, also points out that two different contractors could provide the "exact" same price for the same job but may not necessarily be providing an apples-to-apples comparison. 

“What each contractor provides as scope of work, the materials used, their assumptions regarding labor, and permits required will affect the quote, regardless of whether or not you asked them to provide the exact same scope of work on paper,” Kurz explains. 

How to choose the right contractor 

The contractor with the cheapest quote isn’t necessarily the best option. 

“Sometimes the one with the higher quote is worth hiring as doing so gives you the chance to work with a highly regarded and well-established company and increases your chances for a better result,” says Kazimierski.

Surprisingly, Gregg Cantor, president and CEO of Murray Lampert Design, Build, Remodel in San Diego, recommends throwing out the lowest quote altogether. 

“Established companies with a good reputation and warranty will never be the lowest bidders. Simple as that,” says Cantor.

Whatever you do, always get at least a few quotes from different contractors and look beyond price. Learn how long they think the project might take them, how they plan to approach it, and whether they have any concerns or ideas.

“All of that information will give you a better idea of how they’ll handle the project if hired and whether or not they seem to want to really help you out (versus being clearly profit-focused),” Kazimierski explains.

Also, review each quote item-by-item. 

“Find out what’s not included and what it would cause to initiate a change order. Determine what allowances were used in estimating costs. Also, find out what assumptions are being made regarding the current condition of your home, since this is often where unexpected costs arise later,” Kurz says.

More often than not, choosing a contractor that you really connect with and believe truly understands your situation can be the best decision.

Asking for references and calling them can also help you zero in on the right professional for the job.