For most home remodeling projects in California, get three bids from licensed, insured contractors. Three is enough to tell whether a price is fair and to see how differently each contractor plans to do the work, without stretching your timeline by an extra month. Go to four or five only when the project is large or complicated, like a kitchen you are reconfiguring, an addition, or an ADU.
Here at GreatBuildz, we speak with clients every day about getting estimates for a home renovation project. GreatBuildz is a free service that connects homeowners with reliable, pre-screened home contractors throughout California, then provides ongoing project support to ensure a stress-free experience. In this blog, we’ll share some ideas and tips for collecting and comparing contractor bids.
How Many Bids Should You Get?
Three works for most projects because of what the third bid tells you. With two bids, all you learn is which one is cheaper. With three, a pattern shows up: if two contractors land near $60,000 and the third comes in at $38,000, the low one is usually missing work rather than offering you a bargain. Two numbers can’t show you that.
More bids stop helping fairly quickly. Past four, contractors start repeating each other, and you spend weeks scheduling walkthroughs instead of starting the job. Every contractor you meet with is also a couple of hours of your own time.
A rough guide, depending on what you’re building:
- Three bids for a job with a clear, contained scope: a bathroom remodel, flooring, a roof replacement.
- Three to four bids for a kitchen remodel where you’re moving plumbing, electrical, or walls.
- Four to five bids for a home renovation project at the larger end: an addition, a whole-house remodel, or an ADU.
The pattern behind that: the more decisions a project involves, the more the contractors’ approaches will differ, and the more value there is in seeing another one.
What’s Actually Inside a Contractor’s Bid
A bid is the contractor’s estimate of what your project will cost. It isn’t a fixed price and it isn’t a contract yet. A bid you can actually use shows you where the money goes:
- Labor. The contractor’s own crew, plus any subcontractors, which are the licensed specialists brought in for electrical, plumbing, and heating and air.
- Materials. Lumber, drywall, tile, fixtures, cabinets, and everything else that gets installed.
- Permits. The fees your city charges to review the plans and inspect the work. Ask whether these are included or billed to you separately.
- Allowances. A placeholder dollar amount for something you haven’t picked yet, like tile or a vanity. If you choose something more expensive later, you pay the difference.
- Overhead and profit. What the contractor charges to run the business and make a living on your job. A contractor who shows this line is being straight with you, not overcharging you.
When a bid is one line that reads Kitchen remodel, $72,000, you have nothing to compare against anyone else. Ask for it broken out before you go any further. Most good contractors will do it without complaint, because a detailed estimate protects them as much as it protects you.
The Risk of Getting Too Many Bids
Homeowners sometimes assume that more estimates mean a better decision. In practice, a long list of contenders makes the choice harder, not easier. Six bids take six walkthroughs to schedule, six follow-up calls, and six documents to read closely enough to compare. By the time you finish, the first contractor you liked has booked another job.
There’s also a real cost to spreading yourself thin. Comparing three bids carefully beats skimming six. If two of your three come back with wildly different numbers, the better move is to go back and ask why, rather than to add a fourth contractor to the pile. Estimates vary for reasons that usually make sense once someone explains them.
How to Compare Bids Fairly
A fair comparison only happens when every contractor priced the same work. Before you invite anyone out, write down your scope of work, which is the plain-language list of what you want done, and hand the identical list to each contractor. If one contractor is pricing a tub and another is pricing a walk-in shower, the two numbers mean nothing next to each other.
Once the bids come back, go through them line by line and ask:
- Does every bid cover the same rooms, materials, and finishes?
- Who is pulling the permits, and are those fees inside the price or on top of it?
- What does the payment schedule look like, and does each payment line up with work that will actually be finished by then?
- How are change orders handled? A change order is a written amendment you both sign when the job changes mid-project, and it becomes part of your contract.
- What’s the timeline, and what happens if it slips?
- Is anything conspicuously absent, like demolition, debris removal, or painting?
Putting the bids side by side in a spreadsheet is the fastest way to make the gaps visible, because a missing line is much easier to spot in a column than in a PDF. Our free BidCompare AI tool does this for you: upload the bids and it normalizes them into one comparison so you can see what each contractor included and left out.
One more thing to build in. An estimate is not a guarantee of the final price, so set aside a contingency of 10% to 15% of your budget for the surprises that turn up once walls are open. Every experienced homeowner will tell you the same thing.
What California Law Requires in Your Contract
Once you accept a bid, it turns into a contract, and California sets rules about what that contract has to contain. These are worth knowing while you’re still comparing bids, because a contractor who brushes past them is telling you something useful about how the rest of the job will go.
According to the Contractors State License Board, the state agency that licenses and regulates contractors in California:
- A written contract is required for any home improvement project over $500.
- Your down payment cannot be more than $1,000 or 10% of the contract price, whichever is less. There is no exception for special-order materials.
- After the down payment, payments cannot run ahead of the work. A contractor is not allowed to bill you for work that hasn’t been done or materials that haven’t been delivered.
- The contract has to state who is responsible for pulling the permits, and it has to include a completion date.
- Any change to the price or the scope needs a written change order, signed by both of you, before the work happens.
- The contract must identify the contractor’s name, business address, and license number.
That license number is worth two minutes of your time. You can look up any California contractor free on the CSLB license check and see whether the license is active, who it belongs to, and whether the contractor carries workers’ compensation insurance. As of January 1, 2025, a California contractor needs a license for any job over $1,000, and for any job that requires a permit no matter what it costs.
Red Flags in a Contractor’s Bid
Most contractors who bid your project will be honest people trying to win work. A few won’t be, and their bids usually give them away.
- A bid far below the others. A price 30% or 40% under the rest of the field is rarely a deal. It usually means missing scope, cheaper materials than you specified, or a plan to make the money back through change orders once your kitchen is demolished and you have nowhere else to go. This is common enough that contractors themselves name it: in a Consumer Reports survey of 300 general contractors, one of the shady practices they reported seeing in the trade was winning jobs with lowball bids and raising the cost later by pointing to unforeseen problems. If you’re tempted by the cheapest bid, ask that contractor to walk you through what the others included that they didn’t.
- Lump sums with no breakdown. Several tasks bundled into one line with no specifications is a way of hiding what isn’t in there. Ask for detail, and pay attention to whether you get it.
- A big deposit request. Anyone asking for 30% or 50% up front on a home improvement job is over the legal limit, and that tells you either they don’t know the rules or they don’t follow them. Neither is good.
- Pressure to sign now. Discounts that expire today, a crew that happens to be in your neighborhood this week, a contract pushed across the table before you’ve read it. A contractor who wants your project will still want it on Friday.
- No license number anywhere. It belongs on the bid, the contract, and the business card. If you have to ask for it twice, stop.
Price Is Not the Whole Decision
Price matters, and pretending otherwise would be silly when you’re spending this kind of money. It’s just a poor way to pick between three qualified people, because the number on the page says very little about how the next four months will go.
What we watch for at GreatBuildz, and what homeowners tell us mattered most in hindsight, comes down to a few things beyond the bottom line. Does the contractor return calls? Did they ask questions about your house that the others didn’t think to ask? Can they show you finished projects like yours, and will past clients get on the phone with you? Does their experience actually match your project type, or are they a kitchen specialist bidding your addition because work is slow?
Credentials are worth checking even when the referral came from someone you trust. In that same Consumer Reports survey, almost a fifth of general contractors lacked either a state license or the proper insurance, and 9% lacked both. The survey also found that fully credentialed contractors were better at holding costs down when unexpected problems came up, which is the situation where the difference between contractors actually shows.
Finding a contractor you can trust is hard, and we’re not going to pretend that three bids and a spreadsheet make it simple. A little preparation helps, though. Here are 5 things to do before getting remodeling estimates so the bids you get back are worth comparing in the first place.
Frequently Asked Questions
How many bids should I get for a construction project?
Three is the right number for most home projects. It gives you enough range to judge whether a price is fair and to compare how each contractor approaches the scope, without overwhelming you or stretching out your timeline. Fewer than three makes it hard to spot an outlier bid. For a large or complicated project like an addition or an ADU, four or five is reasonable.
Why shouldn’t I just take the lowest bid?
The lowest bid often reflects missing scope, cheaper materials, or a plan to add costs later through change orders. Compare bids on what is actually included, the materials, the timeline, and the contractor’s references, so you are comparing value rather than just the bottom-line number.
How do I compare contractor bids fairly?
Give every contractor the same written scope of work so they are all pricing the same job, then compare the bids line by line. Look at the payment schedule, the timeline, who is pulling permits, and how change orders are handled. A clear, detailed bid is usually a sign of a contractor who runs an organized project.
How much can a California contractor ask for as a down payment?
No more than $1,000 or 10% of the contract price, whichever is less, on a home improvement job. This is set by the Contractors State License Board and there is no exception for special-order materials. After the down payment, payments cannot run ahead of the work that has been completed or the materials that have been delivered.
Is a contractor’s estimate legally binding?
No. An estimate is the contractor’s best projection of cost, not a fixed price. It becomes binding once it is written into a signed contract, which California requires for any home improvement project over $500. Until then, treat the number as a well-informed approximation.
How long does it take to get three contractor bids?
Plan on two to three weeks. Most contractors can come out for a walkthrough within a week, and then need a few days to a week to put a detailed bid together. Scheduling is usually the slow part, so reach out to all three at once rather than one at a time.
When it comes to planning and coordinating a home improvement project in Los Angeles, Ventura, or Orange County, you shouldn’t have to go it alone. GreatBuildz is a free service that connects homeowners with reliable, thoroughly screened general contractors and provides project support from start to finish. Call us at 888.668.2454 or get matched here.
