How much does a general contractor charge? On a full home build, most general contractors charge a fee of 10% to 20% of total construction cost. On smaller work and pre-construction consulting, hourly rates run $50 to $150, according to HomeGuide’s 2026 contractor cost data.
That percentage is not a finder’s fee. It buys project management, scheduling, supervision, liability insurance, warranty exposure and the coordination of every subcontractor and material order on the job. Understanding what it covers is the difference between comparing bids well and getting burned.
Key takeaways
- A general contractor fee of 10% to 20% of construction cost is the industry norm on a full build.
- Hourly billing of $50 to $150 applies mostly to consulting and small jobs, not houses.
- Fixed price puts overrun risk on the builder. Cost-plus leaves the total open.
- Two bids that differ wildly are almost always quoting different scope, not different quality.
- Design and engineering are usually separate from the construction fee, and they come first.
What this article covers
- The percentage fee, and what it actually pays for
- When contractors bill hourly
- Fixed price vs. cost-plus
- Why two bids never match
- What changes on a Colorado mountain build
- Where the money actually starts
How Much Does a General Contractor Charge as a Percentage?
Ten to twenty percent of construction cost. On a $600,000 build that is $60,000 to $120,000. That band is the honest answer to how much does a general contractor charge on a full residential project.
Where a specific job lands inside that band depends on complexity, site difficulty and how much of the work the contractor self-performs. A straightforward build on flat ground with easy access sits at the bottom. A steep mountain site with a long driveway, a well, a septic system and a hand-crafted structure sits at the top, because the coordination load is genuinely higher.
| What the fee covers | Why it costs money |
|---|---|
| Project management | A named person owning schedule, sequence and problem-solving for 12 to 24 months |
| Subcontractor coordination | Twenty-plus trades booked in the right order, with the site ready when each arrives |
| Purchasing and logistics | Materials ordered, delivered and stored without theft, weather damage or delay |
| Supervision and quality | Somebody on site catching the mistake before it is buried behind drywall |
| Insurance and licensing | General liability and workers compensation covering the work on your property |
| Warranty | Somebody who answers the phone after you move in |
When Does a General Contractor Charge Hourly?
The answer to how much does a general contractor charge changes completely on small work. Hourly rates of $50 to $150 are real, but they apply to a narrow slice of jobs: pre-construction consulting, small remodels, repairs and punch-list items.
Nobody builds a house hourly. A full build runs 12 to 24 months and involves dozens of trades. Open-ended hourly billing on a job that size gives the homeowner no ceiling and no way to finance it, which is why percentage fees and fixed contract prices exist.
Fixed Price vs. Cost-Plus: Which Protects You?
Fixed price protects the homeowner. Cost-plus protects the builder.
| Structure | How it works | Who carries the risk |
|---|---|---|
| Fixed price (lump sum) | One contract number for a defined scope | The builder. Overruns come out of their margin |
| Cost-plus percentage | You pay actual cost plus an agreed percentage | You. The fee rises as the cost rises |
| Cost-plus with a cap | Actual cost plus a fee, ceiling agreed up front | Shared, which is why it is common on complex sites |
HomeGuide puts the objection plainly: a straight cost-plus agreement “favors the contractor rather than the homeowner because the contractor has an incentive to increase the budget wherever possible.” That is not an accusation against any builder. It is a reason to understand which structure you are signing.
A fixed price is only possible when the scope is genuinely defined — which means drawings, engineering and specifications exist before the construction contract does.
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Why Do Two General Contractors Quote Totally Different Numbers?
Because they are not pricing the same house. Scope, not greed, explains almost every gap.
Before you compare two numbers, make them comparable:
- Site work. Does the bid include driveway, excavation, utility trenching, and rock removal, or does it assume flat, cleared ground?
- Utilities. Well, septic, propane and power service are five and six figure line items on raw land. One bid may exclude them entirely.
- Allowances. A $12 per square foot flooring allowance and a $30 allowance produce very different houses and very different final invoices.
- Engineering. Snow load, wind load and soils reports are required in most mountain counties and are frequently left out of an early number.
- Finish level. Cabinetry, windows and millwork can swing a build by six figures without changing a single dimension.
What Changes on a Colorado Mountain Build
Elevation, access and snow load. All three raise the real cost of a build in ways a flatland bid never accounts for.
Design snow loads on Colorado’s Western Slope drive heavier framing and engineered connections. Steep or unpaved access adds haul time to every delivery. A short build season compresses the schedule and raises the cost of any delay. And on remote parcels, getting power and water to the building envelope can cost more than the foundation.
Colorado also has no state general contractor license — licensing is handled by individual cities and counties. Verifying a builder locally matters more here than in states with a single statewide credential. We cover that in our general contracting services.
Where the Money Actually Starts
Not with a construction contract. With a design agreement. Asking how much does a general contractor charge is the right question, but it has no honest answer until somebody has drawn and engineered the house.
You cannot get a fixed price, a lender-ready number, or a fair comparison between builders until somebody has drawn the house, engineered it for your site, and priced the real scope. That work is a separate, much smaller engagement than the build itself, and it is where every honest number begins. Our log cabin cost breakdown shows how the tiers work once a design exists.
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Frequently asked questions
How much does a general contractor charge to build a house?
Most general contractors charge a fee of 10% to 20% of total construction cost on a full build. On a $600,000 project that is $60,000 to $120,000, and it covers project management, scheduling, supervision, insurance, warranty and the coordination of every subcontractor and material order.
Do general contractors charge hourly?
Rarely on a full build. Hourly rates of $50 to $150 show up mostly in pre-construction consulting, small remodels and punch-list work. On a house, a percentage fee or a fixed contract price is standard because the job runs for months and involves dozens of trades.
Is cost-plus or fixed price better for the homeowner?
Fixed price puts the risk of overruns on the builder and gives you one number to finance against. Cost-plus gives you visibility into every invoice but leaves the final total open. Fixed price is generally safer for a homeowner; cost-plus works when the scope genuinely cannot be defined up front.
Why do two contractors quote such different numbers?
Almost always because they are not quoting the same scope. One includes site work, utilities and allowances that reflect what you actually want; the other assumes flat ground, an existing driveway and builder-grade finishes. Comparing bids without comparing scope is the most expensive mistake in residential construction.
What is a construction allowance and why does it matter?
An allowance is a placeholder budget for something not yet selected, like flooring or lighting. Low allowances make a bid look cheaper and produce change orders later. Ask what each allowance assumes per square foot before you compare two numbers.
Does a general contractor fee include the design?
Usually not. Design, engineering and permit drawings are separate, and they come first. That is why most custom projects start with a design agreement rather than a construction contract.
How do I know a contractor fee is fair?
Compare the fee against what it covers, not against another percentage. A 12% fee with real supervision, a named project manager, insurance and a warranty is cheaper than an 8% fee where you end up coordinating subs yourself.