Fixed-pricevscost-pluscontracts:whichprotectsyou?
Brisbane builders are increasingly pushing cost-plus contracts. Here's what they mean, who they benefit, and why we only sign fixed-price.
Post-pandemic, more and more Brisbane builders are quietly pushing clients towards cost-plus contracts instead of fixed-price. It's worth understanding the difference before you sign anything.
Fixed-price contracts
You sign for a single contract sum to deliver a defined scope. The builder takes the risk on labour, materials and program. Variations only happen when you change scope, or when something genuinely unforeseeable comes up. This is what every QHC contract is.
Cost-plus contracts
You pay the actual cost of labour and materials, plus a margin (usually 15–25%) to the builder. There's no fixed contract sum. The builder takes none of the risk. Almost every dollar of cost overrun lands on you.
When cost-plus is acceptable
Very limited cases: experimental architectural work where scope genuinely can't be defined, heritage restoration where you can't see what's behind the walls until you open them up, or sophisticated commercial clients with their own quantity surveyors.
For a residential client, fixed-price almost always wins
It transfers the risk to the party best placed to manage it — the builder. It gives you a number you can plan around. And it forces both sides to do the design and documentation properly before construction starts, which is when problems are cheap to solve.
If a builder tells you 'fixed-price isn't really possible anymore', that's a sign they don't want to take the risk on themselves. There are plenty of builders in Brisbane who still will. We're one of them.
