Pricing a Home Remodel for Business Success

Knowing how to price remodeling jobs can be tricky, even in the best of times. Prior to the 2008 meltdown, the residential remodeling business was going great guns. Back then, the budgetary bottom line and quick job completion were the biggest factors to a builder’s remodeling success. Today’s successful builders need to be people-smart as well as money-savvy.

In the leaner, meaner years since then, effective budgeting and planning is the bare minimum a builder needs if they are to succeed. Fortunately, there is a growing inventory of cost-estimator software available that accurately generates detailed bids more quickly than working by hand with educated guesswork. Scopewell, a contractor consulting company in Pennsylvania, has developed a revolutionary platform that connects homeowners with contractors and manages the pricing process from estimation and bidding all the way through to contracting and escrow.  The cost estimation of remodeling work has gotten a lot faster, which leaves time for builders to master the skills that really matter: people-skills.

Building relationships with clients is just as important as building value into their homes. It’s important to understand that people’s emotional investment in their homes is just as deep as their financial one, so responding to the homeowner’s emotional needs is key. If the remodel your clients want is far out of their budget, be ready to suggest cheaper alternatives that include the client’s input. Explain how the remodel has both short-term and a long-term value, and emphasize that the work is an investment in their future. Make sure to prioritize projects which need to take place immediately over ones that can be pushed further down the line.

Builders also need to re-think how they approach the planning process. Most homeowners no longer have large masses of disposable cash to invest in a huge remodel. But they can certainly afford a series of smaller home improvements that add up to a nice big remodel. Instead of scheduling one large project that takes place over several months, break the remodel down into smaller projects that can be completed within a few weeks’ time apiece, scheduled over a course of years, and can be paid for independently of each other. This allows a builder to have frequent income from the smaller jobs and greater job security, and to become the go-to professional for the client’s future needs.

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