PSA for anyone who is looking for a builder right now or will be in the future. The lowest home build bid does NOT mean the lowest price.
Let me repeat that … the lowest home build bid does NOT mean the lowest price.
In this short and sweet episode, we’ll talk about why it’s VERY important to consider more than just the bids (or price quotes) when selecting a builder.
Ready to confidently build a house that you absolutely LOVE and is perfect for YOUR family (now + into the future) … without blowing your budget? Learn how in my *FREE* masterclass, ‘How to Build Your Dream Home on Budget without Sacrificing Your Must-Haves’. 🙌 Grab your (virtual) seat here!
Beware of the Lowest Home Build Bid
Links Mentioned in this Episode:
- BEFORE YOU BUILD℠ Program
- *FREE* Masterclass (‘How to Build Your Dream Home on Budget without Sacrificing Your Must-Haves’) 💪
Below is the full transcript for this podcast episode.
Hey there! Welcome to the BEFORE YOU BUILD℠ podcast. I’m your host, Carrie Barker (aka, Caroline on Design).
Today, in episode 65, we’re talking about WHY the lowest home build bid does NOT mean the lowest price and why you should beware of that lowest bid.
In theory, choosing the lowest home build bid makes sense.
In reality, the lowest home build bid rarely translates into the lowest price.
There are two common reasons for low bids.
The first reason is legit and happens A LOT.
The second reason is shady and also happens A LOT.
Two Common Reasons for Low Home Build Bids
The two common reasons for low home build bids are:
- You aren’t fully clear with your builder about all the upgrades you want in your home (so the bid might be based on the lowest-cost, or base level, products)
- The bid is deliberately low in order to secure your business
I like to give people the benefit of the doubt and assume low bids are simply due to a lack of clear communication between the builder and client about wants, needs, and must-haves.
However, there are *some* builders out there who aren’t afraid of a little ‘bait-and-switch’ tactics.
In other words, they’ll tell you what you want to hear in order for you to hire them.
Do NOT fall into this trap. 🥺
Here is what can go wrong if the lowest bid is selected and nothing else is considered.
👉 Even if your house does end up being that (low) price, the quality (and materials) will likely be much lower than you wanted, or
👉 Unfortunately, the more common outcome in this scenario is that you go SIGNIFICANTLY over that ‘lowest bid’ as you realize that it wasn’t based on your wants and needs AT ALL, so you end up with several ‘change orders’ which will skyrocket that lowest quote.
An Accurate Bid is Better than the Lowest Bid
Believe me … choosing an ACCURATE bid is better than choosing the lowest bid.
It’s better in the long run to get an accurate quote that takes into account YOUR desired level of finishes and your must-haves … even if it’s a higher quote.
At least you know what you’re getting yourself into, and you can always pare down the house costs by removing square footage or saving things for later.
Now, I’m not saying all ‘lowest bids’ are a bad thing, but it is crucial that you carefully consider the quotes you’re given from various builders.
If one quote is *slightly* lower than the others, that’s fine … go with that builder if you want.
However, if one quote is *significantly* lower than the others, that is a RED FLAG … run in the opposite direction!
Again, not all ‘lowest bids’ are bad … but most ‘lowest bids’ are not as they seem.
Typically, when people accept the lowest bid from a builder in hopes of saving money, they find that they actually go WAY over that initial bid as they get into the thick of building their home.
And, unfortunately, at that point, it’s too late to change course, and they have no choice but to continue increasing their construction loan and subsequent mortgage.
So keep this in mind … if you get three or more bids from builders and one bid is significantly lower than the others, I recommend that you really give thought to how this bid was determined before you sign on the dotted line with that builder.
Does this quote take into account ALL of the upgrades and caliber of finishes you want?
Or did the builder quote you for basic finishes that you know you’ll be ‘upgrading’ while you build?
Any upgrade you make while building turns into a ‘change order’, and as you rack up the change orders, the cost of your home continues to go higher and higher.
So just be careful and really consider if the lowest bid is a realistic quote.
Want to Build Your House on Budget?
You’re probably listening to this episode because you want to build your house on budget.
If you want to learn how to build on budget from someone who has been there and done that, grab a (virtual) seat in my *FREE* masterclass, ‘How to Build Your Dream Home ON Budget without Sacrificing Your Must-Haves.’
Here’s exactly what you’ll learn in this *FREE* class:
👉 The top 3 mistakes everybody makes when building a house and WHY these lead to significant budget overages
👉 The simple secret to designing a house you LOVE (psst … no design experience needed!)
👉 My 4 step ‘Before You Build Blueprint™’ for building a house you absolutely love and is perfect for YOUR family … WITHOUT blowing your budget or sacrificing your must-haves
If you’re dreaming of building a home and want to put yourself in the best position to stick to your budget, you do not want to miss this class!
Ready to confidently build a house that you absolutely LOVE and is perfect for YOUR family (now + into the future) … without blowing your budget? Learn how in my *FREE* masterclass, ‘How to Build Your Dream Home on Budget without Sacrificing Your Must-Haves’. 🙌 Grab your (virtual) seat here!
