Do general contractors charge by the hour or by the job?

Question

The reason I am asking is because I am being charged 55/hr for him to knock down a load bearing wall (8 ft span), and place a beam at the top (below the joists), there is no attic work involved. The total cost for this job is estimated $2,875 which he states I won't find a better price anywhere else. Is this true?

Answer 1

As a general contractor, this person may be subcontracting the work to someone else and marking up the price. If this is the case, look for a local carpenter to do the job. Ask around for referrals. Try a local lumberyard, a real estate agent, or if you know someone who owns apartment buildings, ask them. They will know someone who does good work at a reasonable price. If there is a local landlord association, you might be able to get a referral through them.

You did not say the bid included finishing the wall and ceiling with drywall and paint, so I assume it does not. One person can knock down the wall, do any necessary reinforcing and put up the beam, but it would work better with two people. For the sake of argument, let’s say the material cost is $300. Then, labor is $2575. At $55/hour that comes to a little over 43 hours. My best guess is that this is a two day or less job, so it sounds like the bid includes a helper. Find out if the helper is an experienced carpenter or just a laborer, because you should not pay $55 an hour for a laborer.

Get more than one estimate. Stating you will not get a better price anywhere else smacks of a high-pressure sales pitch. This means they want you to sign before you realize you can find someone else to do it cheaper.

The $55 hourly rate is high for our area (small town, east coast shore area), but it depends on where you are. In New York City, I suspect that would be a very low rate. This is a very small job. Many contractors won't even touch it. You may have to pay a higher than market rate to get someone to do it.

The price will also depend on the other work the contractor has to do right now. I needed the renovation of a one-bedroom apartment finished more quickly than we could do it ourselves. The project included new drywall. The going rate to hang and tape a 4 x 8 sheet is $50. One contractor’s quote included an excessive amount for drywall. When questioned, he gave his rate as $100 a sheet. He was in the business of building new homes on spec and had at least one in the works. If I had paid him double the rate, he would have gladly pulled his crew off that job to do mine. Needless to say, he did not get my project.

GJW
Real estate investor

Answer 2

Many contractors will provide a minimum bid which includes an estimated number of hours to complete the job. If more time is required, they will obviously charge at that going rate. Also most will not provide seperate bids for time and materials. The reason is that they often mark up the materials. Some contractors might get a discount on materials because they buy so much, but they still charge you the regular retail price. Depending on the materials, they may also mark up for transportation of materials, including disposal. $55/hr is not a bad price for a licensed and insured contractor. If you have not already hired this person, it would not hurt to get other bids. Just be aware that for a relatively small job like that many contractors will not carefully estimate price to be accurate. They pick a number that they know will cover their costs and put a minimum of $55/hr in their pocket...

Answer 3

Contractors work in many different ways. Some use the time and material way and others give a total for the job with a 10% margin of error. On cost of materials you are entitled to see receipts for materials and he will probably ask for a mark up on the materials.
If you trust your contractor that he is not going to bleed the time he is spending on the job you will be ok, but I would make sure that there is a cap on how much he is charging you. You also want to make sure it is not going to be $55 per hr per man working on the job.
Him stating you won't find a better price tells me that you should maybe get 2 more estimates for the job. Compair prices and see if you are getting the best deal.

Answer 4

How much contractors charge per hour vary depending on the job being performed. Most contractors however, do not charge per hour. They charge per job and have a set amount.

Answer 5

The hourly rate doesn't seem bad but that depends on how many hours he plans to work and what the cost of materials is. Also, is he doing the finish work (covering and painting) on the job? I would ask for a seperate price on materials and labor. I would get more bids.

Answer 6

Get a couple of more bids. You can also put a cap on the hours i.e. not to exceed 3

Answer 7

they can go both ways