There are two ways to price a custom home. One hides the numbers. One shows them. We use the second, and this is why.
The lump sum
A lump-sum bid gives you one number for the whole house. It feels safe. It is not. Inside that number is the builder’s guess at every trade, every material, and every surprise, plus a margin large enough to cover the guesses that go wrong. If the builder guesses high, you overpay and never know it. If the builder guesses low, the project runs out of money and the pressure to cut corners arrives mid-build. Either way the numbers are not yours to see.
Cost-plus, open book
In a cost-plus contract you pay the actual cost of labor and materials, plus a fee for managing the project. Every invoice from every trade and vendor is visible to you. Our budget lists every line: the scope of work for that line, the quantity, the current market rate, and the amount. You can see what the framer charges, what the windows cost, and what we earn. Nothing is marked up out of sight.
The weakness of plain cost-plus is that it has no ceiling. If the project drifts, you pay for the drift. That is why we add the second half.
The guaranteed maximum
After pre-construction, when the house is designed, the materials are selected, and every line is priced with current numbers, the total becomes a guaranteed maximum price. It is a ceiling. If the project comes in under it, the savings are yours. If it runs over, we absorb the difference. The only things that can raise the ceiling are changes you ask for and conditions nobody could see before the ground was opened, and both are handled through a written change order you approve first.
The contingency you can see
Every budget carries a contingency line for the unknown, and it is visible. We hold it inside the guaranteed maximum rather than hiding it inside inflated line items. If it is not needed, it is not spent, and it comes back to you. Site work carries its own contingency because excavation is where surprises live.
Why the planning is paid for
A guaranteed maximum is only as good as the budget under it. A budget written in an afternoon is a guess with a signature on it. Ours takes forty to sixty hours over one to two months: design in 2D and 3D, a scope of work for every line, pricing from every trade and vendor, and a schedule. We charge $100 per hour for that work and credit the full amount back from your deposit when you sign a construction agreement. If you decide to build with someone else, the plans and the budget are yours to take with you. You only pay for pre-construction if you leave with it.
What you get on paper
Before you sign, you hold a line-item estimate, a payment schedule tied to milestones, and a build schedule. During the build, you can see the budget, the invoices behind it, and the schedule at any time. You can download a sample estimate to see the format.
Who this is for
Cost-plus with a guaranteed maximum is for people who read budgets and like it when they are detailed. It is for people who would rather pay for planning than pay for surprises. It is not for people who want one number and no questions. We think that is a fair trade, and it is the only way we build.