When building your dream custom home, understanding your investment and having complete transparency in the construction process shouldn't be luxuries—they should be standard practice. At Long View Custom Homes, we've built our reputation on the cost-plus construction model, a proven approach that puts homeowners in control of their project while ensuring exceptional value and quality craftsmanship throughout the building process.
What Is Cost-Plus Construction?
Cost-plus construction represents a fundamentally different approach to custom home building that prioritizes transparency, flexibility, and value over traditional fixed-price contracts. In this model, homeowners pay for the actual cost of construction materials and labor, plus an agreed-upon percentage for our management and overhead services.
This transparent pricing structure means you see exactly where every dollar is spent throughout your custom home construction project. Unlike traditional fixed-price contracts where builders must estimate costs and add contingency padding, cost-plus construction allows for real-time adjustments and ensures you receive the maximum value for your investment.
The cost-plus model eliminates the guesswork and hidden markups that often characterize traditional construction contracts. When material prices fluctuate or you decide to upgrade finishes, you understand the exact impact on your project budget immediately, allowing for informed decision-making throughout the construction process.
The Long View Custom Homes Difference
Our cost-plus approach reflects our core values of honesty, integrity, and respect. Long View Custom Homes treats every client's investment as if it were our own, ensuring complete transparency in all financial aspects of your project.
These values guide every interaction and decision throughout your custom home construction journey. We believe that building relationships based on trust and transparency creates better outcomes for everyone involved, from initial planning through final walk-through.
Over 25 Years of Experience
Owner Chad Holloway brings extensive residential construction experience dating back to 1996, having worked his way from superintendent to General Manager before establishing Long View Custom Homes in 2022. This background provides invaluable insight into construction costs, material selection, and project management efficiency.
Our experience working throughout the greater Lake Norman region gives us comprehensive knowledge of local building requirements, supplier relationships, and subcontractor networks. This expertise translates directly into cost savings and quality improvements for our clients.
How Cost-Plus Construction Works
Transparent Pricing Structure
The cost-plus model consists of two primary components: actual construction costs and our management fee. Construction costs include all materials, labor, permits, and direct project expenses. Our management fee covers project oversight, coordination, quality control, and business overhead.
This structure ensures that you benefit directly from our supplier relationships, volume purchasing power, and efficient project management. When we negotiate better material prices or complete work ahead of schedule, those savings pass directly to you rather than padding our profit margins.
Real-Time Budget Tracking
Throughout your project, we provide detailed documentation of all expenses, allowing you to track spending against your budget in real-time. This transparency helps identify potential budget adjustments early in the process, preventing costly surprises later in construction.
Regular financial updates include:
- Detailed invoices for all materials and labor
- Progress payments tied to completed work phases
- Updated budget projections based on actual costs
- Change order documentation with clear pricing
Flexibility for Custom Choices
One of the greatest advantages of cost-plus construction is the flexibility to make changes and upgrades throughout the building process. When you see a material or fixture you prefer, we can provide immediate cost information and adjust the project accordingly.
This flexibility extends to:
- Material upgrades during the selection process
- Design modifications that enhance functionality
- Technology integration as new options become available
- Energy efficiency improvements that provide long-term value
- Landscaping adjustments based on site conditions
Comprehensive Project Management
Pre-Construction Planning
Our approach begins with thorough pre-construction planning that establishes realistic budget parameters and project timelines. We work with you to understand your priorities, must-have features, and areas where flexibility might provide cost savings.
During this phase, we develop detailed cost estimates based on your specific plans and specifications. While these estimates provide excellent guidance, the cost-plus model ensures you pay only for actual costs rather than padded estimates designed to protect the builder from price fluctuations.
Construction Phase Management
Throughout construction, our team maintains strict quality control while managing costs effectively. We coordinate with all subcontractors, suppliers, and specialists to ensure work proceeds efficiently and meets our high standards.
Our construction management includes:
- Daily job site supervision and quality control
- Material delivery coordination and inspection
- Subcontractor scheduling and performance monitoring
- Safety compliance and job site organization
- Regular progress updates and communication
Change Order Management
Traditional construction contracts often include hefty markups on change orders, sometimes doubling or tripling actual costs. Our cost-plus model eliminates these excessive markups, charging only actual costs plus our standard management fee for any modifications.
This approach encourages thoughtful decision-making without the fear of excessive penalties for changes that truly improve your home's functionality or value.
Financial Benefits of Cost-Plus Construction
Elimination of Hidden Markups
Traditional fixed-price contracts often include significant markups on materials and labor to protect builders from cost overruns. These markups can add 15-30% or more to project costs, money that provides no additional value to the homeowner.
The cost-plus model eliminates these hidden costs, ensuring that your investment goes directly into materials, labor, and quality craftsmanship rather than excessive profit margins.
Competitive Bidding Advantages
Because we don't need to pad estimates to protect against cost overruns, our initial project bids often appear more competitive than traditional contractors. More importantly, our final costs typically remain close to initial estimates because we base projections on actual market prices rather than inflated contingency planning.
Volume Purchasing Benefits
Our established relationships with suppliers and subcontractors allow us to negotiate favorable pricing that passes directly to you. In traditional contracts, these savings might be retained as additional profit, but cost-plus construction ensures you receive the full benefit of our purchasing power.
Quality Control and Standards
Material Selection Process
The cost-plus model allows for more thoughtful material selection because you see the actual cost differences between options. This transparency helps you make informed decisions about where to invest in premium materials and where standard options provide excellent value.
We guide you through material selection with honest assessments of:
- Long-term durability and maintenance requirements
- Aesthetic impact on your home's overall design
- Energy efficiency implications
- Resale value considerations
Craftsmanship Standards
Our commitment to quality remains unwavering regardless of the pricing model. Every aspect of construction meets or exceeds industry standards, and our cost-plus approach actually enhances quality control because we're not pressured to cut corners to protect profit margins.
Quality control measures include:
- Regular inspections at key construction phases
- Subcontractor performance monitoring to ensure workmanship standards
- Material quality verification upon delivery and installation
- Code compliance verification before final inspections
- Client walk-throughs at major completion milestones
The Construction Process
Phase 1: Pre-Construction and Budgeting
Before construction begins, we establish detailed budgets based on your approved plans and specifications. This process includes obtaining firm pricing from subcontractors and suppliers, ensuring accurate cost projections.
We review all budget components with you, explaining each line item and discussing potential variables that might affect final costs. This transparency allows you to make informed decisions about priorities and potential modifications.
Phase 2: Construction Execution
During construction, we maintain detailed records of all expenses and provide regular updates on budget status. Monthly financial reports show actual costs versus projections, helping identify any adjustments needed for remaining work.
Our project management ensures efficient use of time and resources, minimizing waste and maximizing value. This efficiency benefits you directly through reduced labor costs and shorter construction timelines.
Phase 3: Final Accounting and Closeout
Upon project completion, we provide comprehensive final accounting that details all project expenses. This documentation serves as a complete record of your investment and can be valuable for insurance, warranty, or resale purposes.
Service Areas and Local Expertise
Long View Custom Homes provides cost-plus construction services throughout the greater Lake Norman region, including:
- Iredell County
- Catawba County
- Rowan County
- Davie County
- Cabarrus County
- Mecklenburg County
Our local expertise ensures familiarity with area building codes, permit requirements, and inspection processes. This knowledge helps avoid costly delays and ensures smooth project progression from start to finish.
Why Choose Cost-Plus Construction?
Budget Predictability with Flexibility
While traditional contracts might seem more predictable, they often include significant contingencies that you pay for whether needed or not. Cost-plus construction provides genuine predictability based on actual costs while maintaining flexibility for improvements and modifications.
Alignment of Interests
Traditional contracts can create adversarial relationships where builders benefit from cutting corners or charging excessive markups on changes. Cost-plus construction aligns our interests with yours—we succeed when you receive excellent value and quality craftsmanship.
Enhanced Communication
The transparency required for cost-plus construction naturally leads to better communication throughout the project. Regular financial updates and decision-making opportunities keep you informed and involved in your home's construction progress.
Frequently Asked Questions
How do you ensure cost control in a cost-plus contract?
We provide detailed pre-construction budgets, regular financial updates, and require approval for any significant expenditures beyond the original scope. Our management fee structure incentivizes efficient project completion rather than extended timelines.
What happens if costs exceed initial estimates?
We discuss potential cost adjustments as soon as they're identified, providing options for managing budget impacts. Changes might include material substitutions, scope modifications, or timeline adjustments based on your priorities.
How does your management fee compare to traditional markups?
Our management fee is typically lower than the combined markups and contingencies built into traditional fixed-price contracts, while providing complete transparency in all project costs.
Can I make changes during construction?
Yes, the cost-plus model accommodates changes more easily than traditional contracts. We provide immediate cost information for any modifications, allowing informed decision-making throughout construction.
What documentation do you provide for project expenses?
We maintain detailed records of all project expenses, including invoices, receipts, and labor records. Monthly reports show spending against budget, and final documentation provides complete project accounting.
Ready to experience the transparency and value of cost-plus construction for your custom home? Contact Long View Custom Homes today to discuss your project and learn how our approach can maximize your investment while ensuring exceptional quality and craftsmanship.