Bathroom tile can cost from $1/s.f. to $10/s.f. depending on what the owner chooses so you are the only one who could know if the allowance is appropriate.

An allowance is miniature "Cost of the Work" contract inside a fixed price contract. The amount of the allowance is really only a place holder and serves to help you budget. It should be for the tile material only and you should be allowed to select the tile from several different sources.

Determine if there is a mark-up on the contractor's actual cost for the tile or if the tile supplier's price will be passed on to you or if you are allowed to buy the tile from the supplier.

The only way to avoid an allowance is to choose the tile now. The cost should be the same whether or not you use an allowance so do what is convenient for you.

Does $3 allowance on tile per sq. of 153 sq mean the contractor can choose the title maximum $3 per sq? I heard the allowance may hurt the homeowner the final price because the final actual price may be higher than the allowance. Can you explain it?

An allowance is just that - the price from the contractor includes $3.00 psf for tile. If you want tile that costs $2.00 psf, then you don't pay more (often you won't get anything back either). If you want tile that costs $10.00 psf, you'll pay the additional $7.00 psf in addition to the contract price. It's just $$$$ - the contractor doesn't pick anything, you do.

We just completed a master bath remodel. Our allowance for tile was $5/sq ft. This was to cover the pretty stuff. All the other related materials, like underlayment, water proofing, etc. plus the labor to install the tile was covered in the contract. fter we picked out the tile, the contractor paid the bill, picked it up, and delivered it to our house.

We spent $7.14/sq ft on tile. When it came time to settle up the overages for allowance items, we paid the add'l $2.14/sq ft. If we had stuck with $5/sq ft tile choices, we wouldn't have owed any add'l money to the contractor at the end of the project.

Paying the extra didn't cause the contractor to "hurt" us as the tile choices were entirely within our control. We "hurt" our own budget when we picked what we picked.

That said, I tend to think $3/sq ft for tile is pretty low. You might head out to a good quality tile shop in your area (not the DIY stores) and see what $3/sf will buy you.

As an aside, had we picked out tile for $4/sf, our contractor would have credited us back the unspent $1/sf in the final billing.

This post was edited by Jewel654 on Mon, Apr 28, 14 at 12:31

As an aside, had we picked out tile for $4/sf, our contractor would have credited us back the unspent $1/sf in the final billing

Which is why allowances are kind of silly - if you're going to pay the difference for an overage, and get back the difference for an underage, why not just have no allowance, and pay for the tile yourself regardless of what it costs?

You could ask for a contract with no allowances. The contractor would just have to specify exactly what the homeowner has to provide. Most items would be pretty straight forward, but I could see plumbing getting sticky with most homeowners picturing in their head "faucet with handles" and most contractors believing the homeowner will also provide all the under cabinet parts and the drain stopper. The devil is in the details.

The final cost of an allowance will inevitably change the contract price so it must be resolved with a change order with receipts for the material purchased. So if the contractor paid less he cannot keep the difference for himself.

Some contractors are willing to install material supplied by an owner and some are not therefore the use of an allowance is dependent on an initial negotiation with the contractor.

In any event the issue of who is responsible for the purchase and delivery of the material must be stated in the written contract. It is possible to state in the contract that the owner has the right (with proper notice to the GC) to supply the material and ask for a change order removing the allowance amount from the contract amount.

I think most contractors prefer to have a contract with allowances for materials so the client has a guideline of what they can expect the overall project to cost.

If the client is a newbie to remodeling or is delusional :), imagine the turmoil when half way through the project he finally realizes that his choices are 3x more than he can afford even if he picks bottom of the barrel items. There goes the project...

Jewel, I actually think allowances are worse - the newbie is "given" (yeah, right) a $3.00 psf allowance for tile, that newbie thinks he can get the tile he wants for $3.00 psf and doesn't realize he has to pay the difference. I think it would be much better to just tell the homeowner - you buy the tile, toilet, sinks, faucets.....and I'll get the rest.

I do agree that some contractors under represent what selections will cost. We found that to be true with our recent bath remodel, but we knew that before signing the contract.

If the contractor feels as you do about allowances, I'd advise that he insist that the homeowner have all the selections purchased (and maybe on-site) before demo even begins.