The cost of renovating in New York City can be intimidating. This is particularly the case in Manhattan and Brooklyn, where homeowners often experience sticker shock.
The best way to understand the true cost of your renovation is to get a full breakdown in the form of an estimate and final pricing. Armed with accurate pricing information, homeowners are able to plan to their scope, budget, and schedule—and avoid sticker shock.
“While the costs of renovating in New York City can seem intimidating, we work diligently to show you how to make more informed spending decisions and give you the tools you need for a successful, on-budget renovation,” says Anna Karp, COO and co-founder of Bolster, a New York City based firm that has designed a seamless renovation experience.
Unlike other design-build firms, Bolster provides homeowners with radical transparency and a zero-risk financial guarantee. Through the use of a proprietary, data-driven estimating tool, Bolster provides homeowners with a more accurate estimate of overall costs. This is no small feat, given that half of the renovation projects in the U.S. go 40 percent to 200 percent over budget. The firm also boasts a vertically integrated services structure that allows for a full-team approach to renovation, with the architect, designer, contractor and builder working together from inception to completion of the homeowner’s project.
“Our technology is a game changer—it enables you to see expenses down to the cent. When homeowners really understand their costs, the price tags start to feel less frightening and more contextualized,” Anna says.
It’s all about the level of detail
The main difference between an estimate and the final price is the level of detail.
An estimate (also called a pre-estimate) occurs at the design schematic phase and provides the real cost of a project with the best information at hand.
For example, an estimate can have an “all-in” number for a kitchen and appliances, but it does not specify the type of kitchen or the serial number of an appliance.
Final price is provided at construction documentation. The “all-in” number converts into a kitchen cabinetry number, tied to a design and appliances number, tied to serial numbers.
What’s included in an estimate?
An estimate helps all parties to be on the same page about what is being done and how. It’s a 10,000 feet perspective, but it helps homeowners understand that the team understands their vision and needs.
An estimate is comprised of the initial sketches that an architect provides to firm up the scope of work and ideally a series of one to five sketches to base everything on.
For the most accurate estimate, your team first needs to know what expenses they will incur in doing the job (this includes costs of materials and labor).
Estimates should be as detailed as possible to ensure there are no surprise or hidden costs. Data can be a powerful tool (and Bolster does its best to provide useful data from the get-go); however, granular information can only be obtained with a clear brief.
Therefore, an estimate should involve a site visit to assess the property’s condition, the production of a scope of work (a brief for the reno), an analysis of the alteration agreement, and ideally a sketch to base everything from.
What’s included in the final price?
The final price is based on a construction documentation set, which has 50-plus pages of plans (and should also include a specifications reference where all appliances, fixtures, fittings, and more components are laid out). If you visualize the process as the alphabet, the estimate is “A” and the construction documentation set is “Z.” The plans are all the letters in between.
At construction documentation, when a final price is provided, the all-in number converts into a higher level of detail that includes, for example, the final count of units, number of appliances, and serial numbers.
How do you know if an estimate or final price is accurate?
The best way to ensure your estimate and final pricing is accurate is to engage the right team from the start.
Traditional contractors don’t face any penalty for presenting false or inaccurate information, which makes it hard to trust an estimate. It puts pressure on you, and occasionally your architect, to figure out if it’s legitimate.
When you’re not receiving apples-to-apples pricing across estimates—and you don’t understand the techniques that contractors use to make their calculations—it can be challenging to determine who is being honest, and who may be undercutting the competition to win your project.
It may be tempting to go with the contractor who is presenting a lower total cost—but if they’re under-estimating, you might have just signed up to spend hundreds of thousands on your project that you did not intend to.
You could rely on your architect to help you determine if you can trust an estimate - but even architects with years of experience may not have a strong sense of cost, because every renovation project is unique.
And when architects work alone, in isolation from reliable construction and cost information, it increases the likelihood that traditional contractors will eventually come back with estimates that homeowners can’t afford.
The best way to address this knowledge gap is for architects and general contractors to collaborate from the outset, creating fast and frequent feedback, applying to the design of your project the same principles entrepreneurs use in lean start-ups.
Engaging them both at the same time means that as the architect designs, the contractor can estimate the scope of the work and what it’s likely to cost. Both can receive consistent feedback from the homeowner as plans develop.
Plus: trust your gut! By the end of the design phase, you should understand enough about your renovation to be able to make the right financial choices prior to commencing work.
At the outset of a renovation, you (and most other homeowners) may not speak the language. But by the end of a good, collaborative process, you’ll be able to converse fluidly!
Prioritizing your renovation needs is necessary in order to balance out your project’s scope with timeframe, compliance, and design goals. By doing your due diligence in understanding estimates and final costs, you’re setting yourself up for a successful (and budget-friendly) renovation.
The Bolster Smart Renovation Zero-Risk Guarantee
How can a design-build firm guarantee a Zero-Risk renovation?
Bolster has pioneered Smart Renovation. We apply quantitative analysis along with our proprietary technology solution to identify and quantify the performance risk on every renovation project. The result is a personalized strategic approach to each renovation that allows us to absorb 100 percent of the homeowner’s risk. Your home will be beautifully designed, and delivered on-time and on-budget. That is our guarantee.
Smart Renovation & Zero-Risk means that Homeowners are now free to dream.
To start your major home renovation project visit bolster.us
The Bolster Promise video