---
title: "What Is Cost-plus contract? Building Glossary | Halo Homes"
description: "A cost-plus contract has the owner pay the actual cost of the work plus a set fee or percentage to the builder."
url: https://build813.multisites.ai/glossary/cost-plus-contract
publisher: Halo Homes
phone: +1-813-956-1972
quote: https://build813.multisites.ai/contact
---

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# Cost-plus contract

A cost-plus contract has the owner pay the actual cost of the work plus a set fee or percentage to the builder.

In a cost-plus contract, the price is not fixed up front. You pay for the real cost of labor and materials, plus the builder's markup. It gives you a view of costs, but the final total can move.

The National Association of Home Builders describes cost plus as an estimate based on time and labor, plus a percentage markup on material. Because the total can change, many owners also set an [allowance](https://build813.multisites.ai/glossary/allowance) for selections and track each [change order](https://build813.multisites.ai/glossary/change-order). Compare it with a [fixed-price contract](https://build813.multisites.ai/glossary/fixed-price-contract). See [the cost to build a custom home in Tampa](https://build813.multisites.ai/cost-to-build-custom-home-tampa) for published figures.

[Halo Homes can helpCustom home construction](https://build813.multisites.ai/services/custom-home-construction)

## Related terms

-   [Fixed-price contract](https://build813.multisites.ai/glossary/fixed-price-contract)
-   [Allowance](https://build813.multisites.ai/glossary/allowance)
-   [Change order](https://build813.multisites.ai/glossary/change-order)
-   [Draw schedule](https://build813.multisites.ai/glossary/draw-schedule)

## Sources

1.  [National Association of Home Builders: How Do Builders Charge for Their Services?](https://www.nahb.org/subsites/log-homes/buyers-guide/building-your-team-pages/how-do-builders-charge-for-their-services)

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## Start your home.

Tell Halo about your lot, your plans and your timing. A call or a short note is enough to begin.

[Start your home](https://build813.multisites.ai/contact)

Or call [(813) 956-1972](tel:+1-813-956-1972)