Allowance

Allowances handle items requiring owner selection but needed for contract pricing: light fixtures, plumbing fixtures, tile, appliances, hardware, etc. Contracts specify allowance amounts—if actual selections cost less, you receive credit; if more, you pay the difference. Example: $5,000 lighting allowance. You select fixtures totaling $4,200—you save $800. Or you select $6,500 in fixtures—you pay the additional $1,500. Allowances let contracts proceed before every selection is made, but require careful tracking to avoid budget surprises.

How to Handle Allowances

Understand allowance amounts in your contract and what they include. Does tile allowance include labor or just materials? Is it per square foot or total? Shop early to verify allowances are realistic for your taste. If standard allowances won't cover your preferred finishes, negotiate higher allowances before signing. Track selections and costs carefully—maintain a spreadsheet showing allowance amount, actual cost, and remaining balance. If trending over budget, value-engineer selections or adjust other areas to compensate.

Common Allowance Items

Plumbing fixtures: Faucets, sinks, toilets, tubs, showers
Lighting fixtures: Interior and exterior lights
Tile and countertops: Materials cost, sometimes including installation
Appliances: Kitchen and laundry appliances
Hardware: Cabinet pulls, hinges, door hardware
Flooring: Hardwood species and grade, carpet quality
Typical allowances: Clarify if they include labor or materials only