I can't see much from your photo, as it's a bit blurry. However, could you place the niche on another wall, between the studs, and save the $400?

Can't speak to the plumbing issues, but I will say that locating the niches away from the spray may not be as handy, but eliminates some cleaning and maintenance issues.

I know, I took the pic with my phone and it came out blurry. It's dark here now and I have no power in the bathroom to turn a light on! I have all my shower hardware on the other wall- the Hansgrohe thermostatic trim, the handheld shower with the bar, etc. I thought of that but they shot me down. I actually preferred that bc then it wouldn't be a focal point. I have a hansgrohe trim and a rainshower on a really high arm, but all the plumbing pipes are there. On the right side of that wall I'm putting a hansgrohe arm with a handheld. He has told me there will be the hose and all that there. Is there something I'm missing about that setup that could still work?

I would go measure your shampoo/conditioner/etc bottles and determine if they could fit in the narrow niche. You could also add height to the narrow space and put 3 shelves to accommodate more products. Ultimately, do what you will like long term. $400 probably isn't much more in a total bath remodel (and you may find a place to save it). As long as you have permits on this project, the inspector will make sure all the plumbing is to code before the walls are closed up.

I agree... that's the part that I'm concerned about. He wants to do it after permiting, and I'm going to all this trouble to permit my bathroom. He said if he does it before that he will have to show that it doesn't take in water from the roof, etc. That makes me nervous. I went to all the extra time and expense to permit, so I would like to keep it that way!

Although I understand his reasoning- he's just moving it for a few feet and it's still going out of the roof the exact same way..

It is not a necessity to center the niche. A little asymmetry can be more interesting. A tall, narrow niche can provide adequate storage. But if, you are not satisfied with those options, spring for the $400 to move the vent.

What style will this bathroom be? I think a tall narrow niche would look interesting and more purposeful (especially if it would be off center anyway). Save yourself the worry.

I like these examples- except they seem wider than 7.5-8 inches. I like the last photo a lot. My bathroom is contemporary so off center is probably fine. I'm more concerned about how narrow 7.5-8 inches will look. I don't want it to fit like one bottle!

I have a concern about that being what looks like an outside wall. Is that wall framed with 2×4, or 2×6 studs? How deep will this niche be? Where do you live (for climate considerations)?

It is an outside wall, but I live in the SF Bay area and the loss of insulation just that small area shouldn't be a problem. There is a 2x4 on the right, and a post or very wide block of wood on the left.

Thanks everyone, I think I'm going to embrace the narrow niche, not move the vent pipe, and just make it taller.

@jmaurry How did it turn out? Could you post a photo? We are facing the same dilemma.