Syllabus / Pricing 101

How quality & skill affect pricing


The quality of the design, materials, construction methods and level of finish you are looking to achieve on your home renovation require an experienced team of professionals and a well-coordinated and skilled labor force. Both of these variables (quality and skill) are inextricably linked and can be major drivers of cost on your project.


How quality varies

Two homes can have the exact same layout, same facilities and features, but one can be remodeled using high-end materials with the best workmanship and can cost several times that of the one remodeled using inferior materials and workmanship.

The standard quality grades used to determine the quality of homes in America go from "E" (cheapest quality at 55% cost relative to average), all the way to "SS" (Ultimate Quality at 275% cost relative to average).

That's a full 225% difference.


Skilled Professionals

It goes without saying that if you have a challenging design-driven project that you need the experience and skill of an architect.

The hourly rates (or percentage of construction costs) you can expect to pay in New York City depends upon the skill and experience of the architect. For a new architect just starting out you should expect to pay anywhere between $100 and $200 per hour (between 7.5% and 15% of your project) for the full range of services (see breakdown below).

For an experienced architect (say 20+ years) with a large portfolio of work who has been featured in top industry publications and perhaps even received some awards, expect to pay anywhere between $200 and $350 per hour (between 15% and 25% of your project).

Learn more about hiring an architect.

When you hire a general contractor, you are investing in their years of experience and ability to source skilled labor and coordinate the installation of quality materials to meet the design goals of your project.

Hiring a tradesman for your renovation over a professional general contractor can be tempting, as it seems as though it’s going to be cheaper. After all, general contractors typically charge a markup of around 30% (or should be if they intend on staying in business for the project) while a one-man-band tradesman may only mark up the project by 10%. 

But hiring a general contractor starts to look like a bargain when you consider where the money is going:

  • Workers compensation premiums: If a worker has an accident on your project, the monetary exposure to a lawsuit can be devastating, not to mention stop-work orders and fines. Having a general contractor with workers compensation coverage protects you from this potential nightmare.

  • General liability premiums: if your home gets damaged, or a family member hurt, by an accident during your project, you want the company you hired to be able to meet the cost. 

  • Office staff: General contractors have a back office, meaning when they're on site or on the road, your project doesn't stand still.

  • Project management fees: You probably don't have the construction management knowledge and experience required to rally multiple tradespersons nor the leverage to get anything done. General contractors have several projects on the go at any one time and employ the same tradespersons regularly. This gives them powerful leverage to get people doing what is expected of them.

  • Tools and equipment, transport, training - the list goes on.



This post is intended for informational purposes only and is general in nature as it does not take into account your personal renovation situation. You should really consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a licensed architect, general contractor or financial / legal adviser.