Ways to price and run a renovation, compared
Fixed price, cost-plus, time and materials, design-build, construction management, acting as your own general contractor and hourly handyman work, side by side.
The way a renovation is priced and organised changes who carries the risk of surprises. This table compares the common contracting arrangements used for Canadian home renovations. It compares structures, not companies or prices; any contractor may offer several of them. Read across a row to see how each arrangement works, when it suits a project and what to watch out for, then use the quote checklist to make quotes comparable.
Select a column header to sort.
| Arrangement | How it works | Best fit when | Watch out for |
|---|---|---|---|
| Fixed price (stipulated sum) | One price for a defined scope; changes are priced through written change orders | Plans and finishes are chosen before signing and the house has few unknowns | Thin scope descriptions, low allowances and expensive change orders; hidden conditions may be excluded |
| Fixed price with allowances | Fixed price for labour and most materials, plus dollar allowances for items you pick later | You need to start before every finish is selected | Allowances set unrealistically low to make the quote look cheaper; check whether they include installation and tax |
| Cost-plus (percentage or fixed fee) | You pay actual costs of labour, materials and subtrades plus a markup or fixed fee | Older houses with many unknowns, or high-end work where choices evolve | No ceiling unless the contract sets one; you need invoices and regular cost reports |
| Time and materials | Hourly or daily labour rate plus materials, billed as work proceeds | Small repairs and jobs where the scope cannot be defined | Budgets drift; ask for a written estimate and, in Ontario, note the CPA's limit on charging more than 10% above an estimate |
| Design-build | One firm handles design, drawings, permits and construction under one contract | You want a single point of responsibility and help with design | Design fees may be payable even if you do not build; make sure drawings are yours to use |
| Construction management or project manager | A manager organises trades you contract with directly, for a fee | Larger projects where you want transparency on each trade's price | You take on more contracts, more risk and possibly owner duties under lien and workplace safety laws |
| Owner as general contractor | You hire and schedule each trade yourself | You have time, experience and a simple project | Permits, inspections, sequencing, warranties and lien holdbacks become your responsibility; trade licensing rules still apply |
| Handyman, hourly | Small tasks billed by the hour or per job | Minor repairs, painting, fixture swaps | Work that needs a permit or a licensed trade (electrical, gas, plumbing in some provinces) is often outside a handyman's scope |
The arrangements above are common practice, not legal categories, and contracts may mix them. Whatever the structure, provincial consumer protection laws set rules for written contracts, estimates and cancellation rights, and lien acts may require holdbacks. Check the rules on your provincial consumer protection office's website (for example Consumer Protection Ontario, Consumer Protection BC, Alberta's consumer protection pages and Quebec's Office de la protection du consommateur), and Quebec's RBQ for licensing. See what a renovation contract should include.