How Much Does It Cost To Build A House? | Park City, UT
Ever wonder how much does it cost to build a house or commercial project? As a general contractor, pricing is as critical to a construction project as quality & timeliness. We’re responsible for ensuring projects remain financially viable for our clients, which starts with a comprehensive budget.
Establishing rates as a licensed contractor guarantees fair compensation for services provided & enables clear communication with clients, eliminating any ambiguity regarding costs & ensuring transparency for all parties.
Our contractor pricing guide equips you with the knowledge to understand how GCs price construction projects. By sharing the different pricing models, we hope to help you gain confidence when moving forward with your construction project.
Construction Contract Pricing Models:
Every project is unique, demanding a tailored pricing strategy. We employ various pricing approaches to serve the needs of our clients.
- Fixed-Price Contracts:
Best suited for clearly defined projects, fixed-price contracts offer peace of mind to clients by providing pricing upfront. We take our time to define & estimate all scope prior to starting, & provide allowances to accommodate for unforeseen circumstances.
- Unit Price Contracts:
Breaking down project costs into itemized units, this model offers transparency & flexibility, ideal for projects with evolving scopes. By pricing each component separately, we help our clients have a clearer understanding of total costs so they can make informed decisions.
- Cost-Plus Contracts:
Guaranteeing coverage of all expenses plus a predefined profit, cost-plus contracts ensure transparency & accommodate project changes. These contracts are suitable for projects subject to alterations, offering insight into costs & profit margins, fostering trust with clients.
- Time & Materials Contracts (T&M):
Charging based on hourly or daily rates, T&M contracts cover labor, materials, & business expenses, providing fair compensation for fluctuating project requirements. Although challenging due to project variability, T&M contracts suit jobs with undefined specifications.
Design-Build vs. Design-Bid-Build:
One of the biggest factors influencing the overall cost of your home or commercial project is the method used to deliver it. Two of the most common approaches are design-bid-build & design-build — the difference between them can have a significant impact on your budget.
- Design-Bid-Build:
In the design-bid-build model, the architect or designer creates a set of plans, which are then sent to multiple contractors for bidding. While this approach can result in lower upfront bids, it often leads to budget overruns, scope gaps, & change orders once construction begins. Without early contractor involvement, critical construction realities may be overlooked during design, driving up costs later.
- Design-Build:
With the design-build model, one team manages both the design & construction. This approach fosters early collaboration, value engineering, & cost transparency. Potential problems are identified early, selections are aligned with budget goals, & pricing stays consistent as the project develops. Design-build projects are more likely to finish on time, within budget, & with fewer surprises!
How Much Does It Cost To Build Your Project:
General contractors typically aim for a markup between 15-20% on new construction homes & 20-30% on remodels.
This markup, or GC fee, is based on the total construction costs & project complexity. The larger the total project costs and simpler the project, the lower the percentage. Larger custom homes & commercial projects may come in as low as 12-15%.
Considerations such as project complexity, geographical factors, & finish selections influence pricing. We spend around 40 hours with each client discussing selections & goals in order to finalize an accurate budget.
While it is very difficult to accurately “ballpark” a large construction project without defining all the scope involved, the average cost per square foot for new construction homes starts around $300/SF in Salt Lake City, UT. In Park City, UT where lots are more complex & finishes are more expensive, new builds start around $600/SF. Remodel costs vary substantially based on project scope. It’s not uncommon to see new homes with complex designs &luxury finishes exceeding $1,000/SF in neighborhoods like The Colony, Deer Valley, Promontory, & Old Town.
When developing a design, consider the gross rather than net square footage. While garages, decks, & storage areas do not typically cost as much per SF as living spaces, they do impact the budget more than most folks imagine.
Reach out if you’d like to learn more about how much does it cost to build & would like to hire us to support you in pricing out your project!
