By Radel Cabrera, Founder & CEO, Core Group International
A fixed-price contract removes the biggest risk in a build: cost blowouts. It locks the total build cost before construction starts, so the number you sign for is the number you pay, subject only to clearly defined exclusions. Here's what fixed-price actually covers and what to check before you sign.
What is a fixed-price contract?
A fixed-price (or lump-sum) building contract sets the total price for the build at the time of signing. Unlike a cost-plus contract, where the final price moves with material and labour costs, a fixed-price contract shifts that risk to the builder. Core Group International builds on fixed-price contracts as part of the Build Smart System.
Why fixed-price matters
- Budget certainty. Your finance is approved against a number that won't move.
- No material cost surprises. Timber, steel and concrete price swings stay with the builder.
- Cleaner settlement. The bank, the builder and you all work to the same figure.
What fixed-price covers: and what it doesn't
A fixed-price contract covers the agreed scope in the building contract and plans. It typically does not cover:
- Site works revealed after earthworks (rock, fill, unsuitable soil).
- Prime cost items and provisional sums where the final selection isn't fixed.
- Changes you request after signing (variations).
- Authority fees and connection charges that move after the contract date.
The key is reading the exclusions, not just the headline price.
What to check before you sign
- Is the price genuinely fixed, or are there large provisional sums?
- What site works are excluded, and what's the likely cost?
- What is the variation process and rate?
- What's the build timeline and the liquidated damages clause?
- Is the builder licensed and insured for the build type?
How CGI uses fixed-price
Under the Build Smart System, the Strategy and Builder Match steps are designed to surface exclusions before you sign. We match you to a vetted builder for the specific block, so site-risk surprises are minimised and the fixed price holds. Book a free assessment to see a fixed-price position for your budget.