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Lesson 2 of 3

Read the bid
the way the money should.

A bid is a list of prices. It is also a list of decisions, most of them made by whoever wrote it. This page is how to read one: four questions for every line, the two words that decide a warranty, the two phrases that let a low bid substitute, and an honest list of where the cheaper choice belongs. Written for the builder who has to answer to the money, and for the money.

A maker's warranty table showing coverage stepping down by year, the kind of table a bid never shows
A warranty is a table, not a headline. The years, the proration, and the word transferable are what a line on a bid is actually worth after closing. Maker's published limited warranty.
Four questions

Ask these of every line where the bids differ.

1. What is its life? Not the warranty term, the years it will do its job on this house before someone pays to do it again. The makers publish the terms; the lessons on this site give them for every material. Pick the number you would defend to a buyer.

2. What does it ask for every year? Repainting, sealing, a service call, filters, or nothing. Upkeep is the cost that never makes the bid and always makes the owner's checkbook. Vinyl never gets painted. Wood gets painted the most. Somebody pays for the difference every year.

3. Who pays when it fails? Read the warranty table: how many years, prorated or not, labor or material only, and whether it transfers to the next owner. A warranty that does not transfer is worth nothing to an investor who sells.

4. What happens at the sale? An inspector will look at it. Fogged glass, soft trim at grade, a roof with five years left, a deck frame gone under a good board: each is a repair credit on the closing statement. The appraisal will not pay for the better choice. The inspection will charge for the worse one.

Divide the installed cost by the life, add a year of upkeep, and you have the cost per year of service. That is the number to compare. The bid price is what one day costs.

Two phrases

"Or equal" and the allowance.

"Or equal." The two words that let a low bid substitute. A spec that names a window and adds "or equal" has named nothing, because equal is whoever's opinion is holding the pen. Two windows the same size, the same style, and the same price per opening can carry a ten-year glass seal or a twenty, roll-formed cladding or extruded, a warranty that transfers or one that dies with the first owner. If a line matters, strike the phrase or define equal in writing: NFRC numbers, design pressure, warranty years, and transferable.

The allowance. A placeholder dollar amount for a line nobody has chosen yet. A low bid with low allowances has not saved money; it has moved the decision to a change order, priced with the house half built and no competing quote on the table. Before you compare totals, ask what each allowance actually buys. Bring it to our counter and we will tell you.

Two words

Years, and transferable.

Every warranty on every line comes down to a table. Years is the term, and whether it is prorated: a 50-year warranty that pays full for five years and then steps down by a couple of percent a year is a five-year warranty with a long tail. Transferable is whether it follows the house. For an investor who sells, a non-transferable warranty ends on closing day, and the buyer's inspector prices that in.

Some warranties also split labor from material. Material-only means the maker sends a replacement and the owner pays a crew to put it in. On siding, roofing, and windows, the labor is most of the second job.

The maker's warranty for every product we carry is on its page or at the counter. Read the table before you read the headline.

Maker's drawing of siding clearances at grade and at the overlap, with nail placement
The spec and the detail arrive together. A bid that saves on the material often saves on the flashing, the clearance, and the nail schedule the makers draw for a reason. Maker's application instructions.
An honest list

Where the cheaper choice belongs.

We sell every tier on these pages and we will quote whichever one fits the house. The cheaper choice is right more often than a supplier likes to say, and a builder who knows where loses fewer bids.

Short hold, plain buyer. A house sold within a year or two to a buyer who does not inspect closely: nothing fails on your watch and the cheap window is the cheap window. Run the numbers at the hold the next owner will have before you decide, but do not let anyone tell you the math is always one way.

Lines the next owner replaces anyway. Builder-grade faucets, light fixtures, carpet in a rental, closet doors. The upgrade money buys nothing that survives the first weekend.

Lines that are cheap to do over. Paint, cabinet hardware, most interior trim. A second job here is an afternoon, not a dumpster.

Where the better spec earns its keep: the lines that are expensive to reach later. Windows, the roof, siding, exterior doors, the frame, and what is in the wall. Then cabinets and the deck frame. Those are the lines to run through the whole-house calculator first.

Bring This to the Meeting

The bid review, line by line.

Print it. Go down the bid with it. Every row is a question the person funding the build is entitled to have answered.

AskWhere the answer isWhat a bad answer looks like
Is the product named, or is it "or equal"?The line item and the spec sheet behind it.A brand with no series, or any line with "or equal" on a material that is hard to reach later.
What does the allowance actually buy?Take the number to the supplier's counter.An allowance that covers the cheapest thing in the catalog and nothing else.
What life does the builder believe for it?The maker's literature; the lessons on this site.A number nobody would say to a buyer with a straight face.
What does it ask for every year?The maker's care instructions and the finish warranty."None," on a product that is painted on the wall.
How many years, prorated or not?The warranty table, not the headline."Lifetime" with a proration table that starts in year two.
Does it transfer?The warranty's transfer clause.Original owner only, on a house built to sell.
Labor, or material only?The warranty's remedy clause.Material only on siding, roofing, or windows.
What will the inspector write about it at the sale?Any home inspector's checklist for that line.Anything the inspector can see from the driveway.
Is the detail bid with the material?Flashing, clearances, fasteners, and the nail schedule in the maker's instructions.A material line with no detail line under it.
What is it per year of service?Installed cost divided by life, plus a year of upkeep. The calculators on this site.Nobody has done the division.
Run the whole house

Before You Price the House

Know what the house costs, not what the window costs.

Three short reads for the builder who has to answer to the money, and for the money. The whole-house math, how to read a bid, and a letter you can hand to your investor.

Frequently Asked

Reading a bid, answered.

What does "or equal" mean on a construction bid?
It means the builder may substitute a product the builder considers equivalent to the one named. On a spec that says a brand and a series, "or equal" is the door the low bid walks through. Two windows can carry the same size, the same operating style, and the same price per opening and have different glass seals, different cladding, and warranties that read nothing alike. If a line matters to you, strike "or equal" or define equal in writing: NFRC numbers, design pressure, warranty years, and whether it transfers.
What is an allowance on a bid, and why does it matter?
An allowance is a placeholder dollar amount for a line that has not been chosen yet, cabinets or lighting or a front door. The bid carries the allowance; the real cost comes later. A low bid with low allowances is not a low bid. It is a bid that has moved the decision to a change order, where the price is set with the house half built and no competing quote in hand. Ask what each allowance would actually buy at the supplier before you compare totals.
What are the two words to look for in a warranty?
Years and transferable. Years tells you how long the maker stands behind the product, and whether that term is prorated (paying less every year) or not. Transferable tells you whether the warranty follows the house to the next owner, which is the only way it helps a buyer or an investor who sells. A "lifetime" warranty that is non-transferable and prorated after year five is a five-year warranty on an investment property. Read the table, not the headline.
What is "builder grade"?
There is no standard behind the phrase. It means the least expensive product the builder could specify that still passes inspection and looks right on closing day. Sometimes that is fine (a closet door). Sometimes it is a window with a ten-year seal on a house that will stand for sixty. The question to ask about any builder-grade line is not what it costs. It is what it costs per year of service, and who pays when the years run out.
How do I compare cost per year of service?
Divide the installed cost of the line by the service life you believe for it, then add a year's upkeep. A material that costs a third more and lasts twice as long is cheaper by the year, and by a lot. Every cost-over-time lesson on this site does this arithmetic on your own two quotes. The whole-house page adds the lines together and includes callbacks and the cost of money.

Stop By the Desk

Let’s talk it through in person.

Bring your plans or just your questions. We’ll get you squared away.
119 Cumberland St, Ashland City. The coffee’s on.

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