Why You Need More Than 3 Estimates for Contractors

by iam1percent on February 19, 2013 · 18 comments

rooferSo I’m in the market for a new roof for my house.  My roof is at the end of its life.  It’s the original roof and made to last 20 years.  It’s about 18 years old and is starting to fall apart.  Also, we plan on staying in this home for decades so we figured we’d get it done now before any damage occurs.

Next step was to begin getting estimates from roofing companies.  I scheduled appointments with 6 contractors to provide me estimates.  I avoided mom-and-pop outfits and went with the larger contractors in the area.  Each contractor came in selling the SAME EXACT SHINGLE SYSTEM!  Its the GAF Timberline HD shingle system.  The system includes the singles, a leak barrier, roof deck protection, attic ventilation, and ridge cap shingles.  They sell it because GAF warranties the product for 50 years and pro-rated for life after 50 years.  The warranty is transferable.  In order to get the warranty, the system has to be installed by a certified GAF installer in the appropriate specifications outlined by GAF.

Like I said, all 6 roofers came in selling the system.  Here are the 6 estimates I received:

  • $10,500
  • $11,400
  • $15,465
  • $15,900
  • $19,300
  • $21,980

As you can see the difference between the cheapest estimate and the most expensive estimate is $12,000!!  They were all bonded, insured, and had references.  The only differences between the estimates were the warranty on the labor, which ranged from 5 years to 10 years.  The other major difference was the history or age of the company.  The youngest company was only 5 years old, while the oldest is over 70 years old.

Right now, I’m leaning towards the $11,400 estimate.  Why not the cheapest estimate you ask?  Well, the company with the $11,400 estimate has been around longer and they’ve done work in our neighborhood.  I also got a good vibe from the representative.  The cheapest estimate was from a company only 5 years old.

So this is why its good to get more than 3 estimates?  Well, had I gotten even 4 estimates from the 4 most expensive contractors, I would’ve spend $4000 more than I otherwise would have.  For any large project, its best to get 5,6 or 7 estimates.  It can save you thousands in the end.

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{ 18 comments… read them below or add one }

White Coat Investor February 19, 2013 at 1:35 pm

I’m pretty sure that’s the same system we put on our roof a couple of years ago. It’s been great so far. We also didn’t go with the very lowest bidder for similar reasons.

I’m still a little skeptical that any roof will last 50 years, but we’ll see. I don’t even know if this house will be here by then.
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iam1percent February 19, 2013 at 9:23 pm

Yeah, I don’t know if it will really last 50 years. Thankfully, its fully warranted (non-pro-rated) for 50 years.

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Michelle February 19, 2013 at 2:56 pm

I think the wide variations in price are due to whether the company is trying to make a profit or not. The lowest bid is probably taking a big hit and making a loss on it. I value a lot of companies where the owners feel bad if they don’t give their employees enough work, so they’ll take a large loss on a project just to employ their workers. I would go with the best value: good price and good quality.
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Michelle February 19, 2013 at 2:59 pm

P.S. When I say value, I mean I am a valuation analyst and value companies for a living. It sounded weird when I just reread my reply.
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Brick By Brick Investing | Marvin February 19, 2013 at 3:11 pm

Amazing how there is such a huge difference in price! I’ve always been taught the rule of thumb is to get 3 quotes but now I see why more is better. Thank you!
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KK @ Student Debt Survivor February 19, 2013 at 10:16 pm

We had a similar experience when we were looking for a painter. After getting some crazy quotes I ended up buying the paint in doing it myself. It was much cheaper and I’m such a perfectionist, I would have made myself crazy if I paid someone else and they made “mistakes”. At least now if there are imperfections I can blame myself and be thankful I saved all that money hiring someone.
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Shape February 20, 2013 at 12:55 pm

I have been having similar experiences with contractors working on my house. The most recent dealings I had quotes range from $5,000 – $8,000 for the same exact work.

But, I like the looks of those shingles, especially their Cool Series (I live in the deep south and put a lot of effort into energy conservation on my home since I own a historic home built in the 20′s). My roof was replaced in 2008 and they are already showing wear from storms and my oaks dropping branches.

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Andy Gauvin February 22, 2013 at 3:57 pm

The thing is, people are often too lazy to ask for 6 or 7 estimates, so they just go with the name they trust and often pay a big premium for it… thanks for the reminder!

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Roofers Newcastle May 14, 2013 at 4:22 am

That is incredible, a $12,000 dollar difference. Imagine what you could spend that spare 12 grand on!! Thank you for this, I will be a lot more cautious when choosing my contractor now!

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iam1percent May 19, 2013 at 6:52 pm

I wish I could think of it as a spare $12k! I just think I found the market price of the roof installation while everything else just marked up…

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Orlando Roofing July 29, 2013 at 11:44 am

Great points in this post. It is true, you want to do your homework in advance of calling contractors for bids/quotes, ask lots of questions of each, ask for referrals and then call a few more. A new roof is a major expense and it is up to the consumer to shop smart to find the best contractor and price for the project.
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Orlando roofer December 15, 2013 at 9:34 am

Appreciate your unusual and at the same time creative way of writing. I like your site very well and continue to do so. I have bookmarked your site.
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Hudson Roofing January 2, 2014 at 9:43 am

Make sure your roofing company has references and this isn’t there first rodeo. This is what’s most important in my opinion. Pricing is obviously a factor as well and like you said – the cheapest option isn’t the best. You are wise to go with a company that’s been around the longest.

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Orlando Roof repair March 10, 2014 at 7:46 am

Thanks for taking the time to talk about this, I feel strongly about it and love learning more on this topic. If feasible, as you gain expertise, would you mind updating your blog with more selective information? It is exceedingly helpful for me. Orlando Roof repair

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Joey Thomas September 13, 2014 at 2:04 pm

That’s why we shan’t be jumping to the first one who gives us the lowest bid. American Prestige Roofing

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new construction Wayne NJ September 14, 2014 at 10:15 am

Ask for referrals when searching for a reputable contractor. If you live in an area that has plenty of resources, ask around at your local home improvement store or lumber yard for contractors they have seen buying quality products. Be mindful of contractors that few people have heard of, or haven’t seen where they purchase their building materials. Poor quality building materials can be the beginning of an awful renovation.

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sidewalks NJ September 14, 2014 at 10:21 am

Always choose materials that are healthy not mixed with hazardous chemicals like natural stone, clay, brick, wood, bamboo, thatch, fibers, reeds, metal, brick, tile soil, glass, concrete, brick and paper.

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Poolscapes Essex County NJ September 14, 2014 at 10:32 am

As one of the largest components of your backyard area, the swimming pool requires a lot of thought and planning in determining where to put it. It must accommodate a deck, surrounding landscaping, and adjoining patios. It’s helpful to imagine your backyard space as activity zones. Your activity zones might include an outdoor kitchen area, a children’s play area, a grassy lawn, the pool deck, planting areas and trees, etc. Each of these activity zones must work in harmony with where you place the pool.

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