What's this Going to Cost?

 How do you answer when an owner asks about cost?

Quote a price that’s higher than expected and the job may not happen. Quote a price that’s too low and your casual comment could end up being quoted in a legal brief. Refuse to quote any price and you’ll be considered devious or uncooperative.

So, what should you say when an owner asks about cost?

My advice: Welcome the question. It’s an invitation to start asking questions yourself. For example:

• “That depends a lot on what you decide. It’s a little too early to nail down a price. But I’m sure we can live within your budget. What figure do you have in mind?”
• “I’ve seen jobs like this go for between $X and $Y. Of course, the cost could be less or more, depending on choices you make later. A lot depends on finish materials and when you want to get started. When I know more about the job, I’ll give you a written estimate.”
• “I don’t want to quote a number off the top of my head. But I have some good references back at the office. I’ll work up numbers based on those figures and get back to you tomorrow with typical square foot costs.”

The cost question comes with an obvious advantage. It’s an open invitation to come back later with an answer. But don’t leave without qualifying your prospect. Too many on-site meetings are a waste of time. I call it a prayer meeting when:

• The owner is undercapitalized or isn’t a good prospect for potential lenders.
• Code or zoning restrictions make the work impractical.
• The owner isn’t being realistic about the cost or what can be built.
• The perceived need is based on assumptions that aren’t realistic.
• The owner has been turned down by several builders or lenders.
• Your prospect may not have authority to contract for the project as conceived.

To be sure you’re not in a prayer meeting, ask some questions yourself:

• “Have you talked to anyone about financing?” Obviously, financing is a key question. Every owner wants to improve their property. Not every owner can qualify for the financing needed to carry a project.
• “Do you have a budget in mind?” This is another key question, the beginning of price negotiations.
• “When would you like to see this job finished?” Identify unrealistic expectations as soon as possible.
• “Have you talked to any other builder [architect, engineer, or consultant] about this job?” If so, ask, “What did they say?”
• “Have you considered . . . ?” Try to identify zoning problems, potential issues with neighbors, design review committees, setback requirements or anything else that could halt the project.

If you plan to come back later with a proposal (and contract), be sure to collect job details:

• Name and address of each property owner
• Construction site – either street address or legal description (for lien purposes)
• Phone numbers –day phone and cell
• Email address
• A good concept of what the job requires – including rough dimensions and square footage Potential access issues, the availability of water, electric, sanitary facilities, etc.
• Who will pull the permit?
• Utility companies that will be involved.

When you come back with a price, bring a contract ready for signature. Construction Contract Writer drafts letter-perfect agreements for any residential or commercial project in any state. The trial version is free.