How Much Does it Cost to Hire a General Contractor?

A general contractor is an individual who has professional experience, as well as necessary licenses and permits, to remodel and build homes. The experience of a general contractor helps in setting accurate estimates for a project, sourcing raw materials from vendors, and ensuring that the project follows a schedule. Together with a general contractor, you’ll be able to remodel or build your home with ease.

If you want to hire a general contractor, then you’ll have some options when it comes to making payment. General contractors tend to charge differently for pre-construction projects, and projects involving building and remodeling. The amount a general contractor charges will depend on the nature of the work, the going rate for general contractors in the area, and any special costs and considerations for the project. If you ask for a fixed price estimate, then the general contractor will provide you with a marked up price, that includes the charge for their professional services.

Costs Involved With Hiring a General Contractor

A general contractor can accept payment in one of many ways. Some contractors accept hourly rates for their work. This can start from $50 per hour, and go all the way up to $1000 per hour, depending on the contractor and the nature of the project.

Other contractors markup their price, and accept installments as they work on the projects. Some general contractors may even ask for a pre-construction services contract. This helps ensure that the time the contractor spends on creating an estimate for the projects is chargeable. Since general contractors often need to put in work to create estimates for projects, this helps them to make an income for the hours put in.

Finally, a general contractor can also have a fixed price they are willing to work for. So, if you want to hire a general contractor, you may have to deal with:

Hourly Rates

Hourly rates can be low or high, and this depends entirely on the nature of the project and the amount of work being done. A general contractor with more experience can also charge more than their newer counterparts. It’s more common for general contractors to charge hourly rates for the pre-construction phase of the project.

Pre-construction Services Contract

Again, the amount you’ll need to spend on pre-construction services will depend on the nature of the job. Usually, this amount is charged as a way to ensure that the time a contractor spends on creating an estimate doesn’t go to waste. Depending on the region, the market, as well as the general contractor, a free estimate can go up to $3000, or even $20,000 for large scale projects.

You can, during this phase, pay either half or the full amount to the contractor up front.

Charging A Fixed Price

Sometimes, a general contractor will charge a fixed price for their work. This takes into consideration all the aspects and costs related to completing the project. Markup costs will usually not be detailed, when charging a fixed price.

However, if you want to know more about the markup of the general contractor, you can ask for the same. A markup takes into consideration the total costs associated with materials and labor of a project, as well as the expertise of the general contractor. The usual markup for general contractors is 1.5x the total cost to complete the project. The markup reflects the contractor’s experience, and enables them to make a profit through their occupation.

You can expect to pay around 10-25% of the total price at the time of starting the project. Then, as the project goes ahead, you can provide the general contractor with payments at fixed times. This ensures that the project proceeds smoothly, and that the general contractor can meet their running expenses related to the project.

Who is a General Contractor?

A general contractor is a professional who has knowledge and experience in building and remodeling buildings. You can hire a general contractor to work on a building that in being constructed, or to remodel a finished project. A general contractor is responsible for everything from creating a budget, ensuring work proceeds on schedule, to delivering the project on time.

A general contractor can help you with:

• New construction projects, from the planning phase to final delivery
• Renovation and remodeling
• Electricity and plumbing
• Painting
• Woodwork
• Roofing and flooring

You can ask a general contractor to step in either right at the beginning of a project, or when remodeling a finished building. The amount your general contractor charges will usually depend on the going rate in your area. This can change depending on your state and locality, however, you can expect general contractors in your area to charge more or less the same price.

Before you decide on a general contractor, consider poring over their details to better understand their experience. Check to see whether they have all necessary licenses and permits, and look for client testimonials to ensure that you find the right general contractor for you. Also make sure they have the right type of insurance depending on what exactly they do, whether they are just a general contractor, roofer, electrician, plumber, or landscaper.

What Does a General Contractor Do?

You can hire a general contractor to either help you with the whole process of building and modeling, or to renovate later on. A general contractor is responsible for:

1. Setting Realistic Budgets

After estimating the cost of working on your property, a general contractor can help you create a budget. This budget usually contains a markup price, that takes into account the work done by the general contractor. What this means is that the general contractor will add the price of their services to the total budget being presented to you. The markup costs reflect what the general contractor is charging specifically for their services.

A general contractor provides a budget only after looking through the costs associated with managing a project. While some general contractors do offer free estimates, many choose not to since creating estimates can be a labor intensive project.

2. Design and Materials

A general contractor, aside from creating the design for a building, is also responsible for sourcing raw materials. They talk to suppliers and vendors, and ensure that basic materials for the project are available at all times.

3. Managing Construction

Where a general contractor truly shines is in their experience managing construction projects. A good general contractor will take care of everything from bringing in people to renovate or develop a building, to ensuring that the project is completed on time.

They will also help you secure any permits you need for your building, where necessary.

4. Post-Construction Services

Often, general contractors will offer post-construction services as well. This is when a general contractor provides a warranty, usually of up to a year, within which they will step in to make any repairs, where needed. This helps ensure that the quality of work put in by the contractor and their team is of good quality. You can expect the quality of the work to last at least through the warranty period.

Conclusion

A general contractor helps plan, set the budget for, and then develop or remodel, a building. Depending on your state and locality, how much a general contractor charges can change. However, you can usually expect to pay either at an hourly rate, a fixed rate, or a marked up price. When you hire a local contractor, make sure you follow some basic guidelines by checking to see if they are licensed, have insurance, and do quality work.