You could look at it this way.....what a quaint little step leading up to the bathroom!
Actually, when I was a girl my father led me through a very old Philadelphia brick row house he was about to remodel. I thought it was so cute because the upstairs hallway had a couple of little steps right in the middle of it. It had to be that way because the ceiling in the front room was higher than the ceiling in the middle room.

We have a step down into our master bedroom because it is in the addition where the downstairs ceilings are lower.

In the kitchen we built a little ramp leading from the family room because there were so many layers of flooring in the kitchen that we didn't want to remove and I was tired of kicking the 1 inch step. It rises over 1 inch in 2 1/2 feet, so it isn't noticeable.

I think the 3 1/2 inch step into your bathroom is tall enough to look like it is an "on purpose" design feature. Play it up and it will look great. All the neighbours will want one too, whether they need it or not.

We have a small step down into the master bath. Another step in the hallway next to it. A couple of steps in the entry. Once you know they are there, I don't think it's a problem. But I always have to make sure guests aware of the steps so they don't trip. I would think a step UP into a room wouldn't be as much of an issue since it would be more visible.

Not long ago I was in a 100ish year old home that had steps up to all of their bathrooms.. I assume it was a plumbing thing... it was actually quite charming.. each had a little.. sil?.. lipped edge??.. on any case no mater what you call it they were painted and then led to the tile area in the bath.

Maddie

The house I grew up in (now more than 100 years old) had a step up in the upstairs bath, for the same reason your contractor wants to put one in. It never bothered us, nor the people who bought the house from my parents.

Thanks to all for your replies.

I have been working with my GC for the last couple of days and we absolutely could not avoid the step-up without tremendous effort and expense. As it turned out, the step-up will be about 2 7/8" and we determined that we will be able to provide a transom with a bevel on it to minimize the impact. We will finish it in a way to make it aesthetically nice without drawing too much attention to it.

Thanks again.

Plum....Square....Level.
Pick 2.
That's how it is in old houses.
:)

Our house is 120 years old, renovated, and we have a 3" step up into the master bath. It does not look odd, and has never been a problem.

I think we all would like a seamless transition going room to room, but
the alternatives to having the floor level are more expensive. Your contractor could start at the doorway and level back, cutting down the rising joists and then sistering new joists to give added strength, but it's Work. Or you could split the difference and have less sag. Some skill with an axe is helpful, I'm serious. The guys that built these houses used a variety of blade tools not seen on a jobsite these days.
Sometimes a level floor looks a little out of place in an old house.
As a former carpenter, I have done alot of renovation in older houses and often found you have to go with the flow , have the baseboard go downhill or shim out the trim and caulk some to make a hump in the wall less pronounced.
It is satisfying to make a house look seamless and 'right'.

Our original bathrooms have cement floors and a step up of about 3 inches.

My bathroom in my now 105 year old house, was sunken, with a rotted pine floor. it had about a 1" drop at the door, down to about 3" at the end of the house, I replace most of the joists and laid marine plywood and built up to level a concrete floor. I put in radiant infloor tubing, but have yet (over 6 years) to attach it to heat source.
anyway the floor is now level "mostly" and it looks much better, but it is the only room in the house that is.
in the living room, the molding was set in such a way as I did not notice the non level floor until I put in a china cabinet that was near the ceiling MAN level sure makes a differance when a large piece of furniture is in there.
the floor and the ceiling are both out of level and the walls are not plumb. "character" is a bit annoying at times.
ok, the foundation is HUGE granite blocks. with about 24" diamater trees supporting the house.
I have been replacing the old cinder block perimater foundation and building a concrete reinforced footing. LOTS of work, but when done, I "may" have more of a plumb and level house.

Walking across the first floor in our house (1920) is like riding a roller coaster. Someone in the past put support pillars in the basement under the load-bearing walls on the first floor, which might have been a good idea if they hadn't been quite so enthusiastic in jacking them up.

I've gotten pretty good at shimming larger pieces of furniture.

you should have seen the 3" shims I needed for the china cabnet!