How To Read A Construction Change Order Without Missing Cost Risk
Learn how to read each section of a change order and catch pricing risk before approval.
Most homeowners focus on the final number. The better approach is checking each section for hidden assumptions.
Section-by-section review
Scope summary
Read this first. If scope language is vague, every downstream price is hard to evaluate.
Line-item table
Each line should include measurable units. If you only see broad phrases, ask for quantity detail.
Labor assumptions
Confirm trade type, hours, and rates. A high rate can be valid in a high-cost metro, but it should still be explicit.
Materials
Look for unit pricing and source assumptions. If high-ticket materials are listed without backup, ask for receipts or supplier quotes.
Markup and OH&P
Markup should state the percentage and the subtotal it applies to. If the base is unclear, the math is not auditable.
Schedule impact
Some changes cost more due to remobilization or sequencing. If schedule pressure is cited, ask how it changes labor or equipment assumptions.
Red-flag language
- "Per field conditions" with no detail
- "Miscellaneous labor and materials" as large percentages of the total
- "Management fee" plus full OH&P with no explanation
Fast approval workflow
- Clarify scope and line-item quantities.
- Confirm labor and material assumptions.
- Validate markup base and percentage.
- Approve with written assumptions attached.