· Michael Blair
A project that finishes well over budget usually did not start with a bad price. It accumulated change orders, most of them individually defensible, none of them individually alarming. Understanding how they arise is what makes them controllable.
The three kinds, which behave differently
Owner-requested changes are the ones you asked for: a different tile, an added outlet, moving a doorway. These are entirely legitimate and entirely within your control, and they are where most overruns actually come from.
Discovered conditions are what was found once things were opened up: knob and tube wiring, a rotten sill, no header over an opening, a drain line where the plan assumed none. These are unavoidable in older Nashville housing stock. Errors and omissions are the third kind, where something was missed in the original scope, and those are worth a harder conversation.
What a change order should contain
A description of the change, the cost, the effect on the schedule in days, and a signature from both parties before the work happens. The schedule impact is the field most often left blank and the one that causes the most friction later, because a series of small changes silently adds weeks.
Get it in writing every time, including for changes that reduce the price. Verbal changes on a job site are the origin of nearly every serious contractor dispute, and the person who remembers the conversation differently is usually whichever party is worse off.
- Written and signed before the work is done
- Cost, and the schedule impact in days
- Reference to what it replaces in the original scope
- A running total showing the revised contract sum
- Credits documented the same way as additions
How to reduce them before the job starts
Make the decisions early. Most owner-requested changes happen because a selection was left open and got made under time pressure once the trades were on site. Tile, fixtures, hardware, paint colours and appliance models chosen and specified before demolition eliminate most of that category.
For discovered conditions, put a contingency in the budget rather than in your hopes, and investigate in advance where it is cheap to do so. Opening a small area of wall or crawling under the house before finalising a scope on a pre-war Nashville home is inexpensive and frequently changes the plan.
Allowances, which are change orders in advance
An allowance is a placeholder amount for something not yet selected. They are a normal part of contracting and they are also where a low bid hides. A quote with a tile allowance well below what you intend to buy will produce a change order the moment you make a real selection.
Ask what each allowance actually buys, in specific terms, and whether it includes labour or only material. Comparing two bids without comparing their allowances is comparing two different projects, and it is the most common reason the cheaper bid does not end up cheaper.