Building Contract Types in Ireland — Fixed-Price vs Cost-Plus, and What Each Means
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Fixed-price shifts price risk to the contractor. Cost-plus charges actual cost plus margin. Most Irish self-builds use fixed-price.
Fixed-price contract: shifts price risk to the contractor (and they price for it, typically 5–10% on top of cost). Most Irish self-builds use this. Cost-plus contract: charges actual cost plus margin (5–15%). Prices can creep. Better for complex or evolving projects where the scope isn't fully defined. Most Irish self-builds use a fixed-price contract with a clear schedule of works. RIAI Standard Form 2012 is the standard. The contract should include: a clear scope of works, a programme, a payment schedule, a retention (5% typical), a defects liability period (12 months typical), and a dispute resolution clause. Get a solicitor to review the contract before you sign.
TL;DR
Fixed-price contract: shifts price risk to the contractor (and they price for it). Most Irish self-builds use this.
Cost-plus contract: charges actual cost plus margin (5–15%). Prices can creep. Better for complex or evolving projects.
Most Irish self-builds use a fixed-price contract with a clear schedule of works. RIAI Standard Form 2012 is the standard.
When this matters most
You're choosing the contract type.
When this doesn't apply
You've signed the contract.
Frequently asked questions
What is a fixed-price building contract?
A contract where the contractor agrees to complete the work for a fixed price. Price risk is on the contractor. Most Irish self-builds use this. RIAI Standard Form 2012.
What is a cost-plus building contract?
A contract where the client pays the actual cost plus a margin (5–15%). Price risk is on the client. Better for complex or evolving projects. Most Irish self-builds avoid this.
What should be in the building contract?
Scope of works, programme, payment schedule, retention (5% typical), defects liability period (12 months typical), dispute resolution clause. RIAI Standard Form 2012 has all of these.
Sources
RIAI, Form of Building Contract 2012. https://www.riai.ie/
Frequently asked questions
What is a fixed-price building contract?
A contract where the contractor agrees to complete the work for a fixed price. Price risk is on the contractor. Most Irish self-builds use this. RIAI Standard Form 2012.
What is a cost-plus building contract?
A contract where the client pays the actual cost plus a margin (5–15%). Price risk is on the client. Better for complex or evolving projects. Most Irish self-builds avoid this.
What should be in the building contract?
Scope of works, programme, payment schedule, retention (5% typical), defects liability period (12 months typical), dispute resolution clause. RIAI Standard Form 2012 has all of these.
When this matters most
You're choosing the contract type.
When this doesn't apply
You've signed the contract.
Where to go next
Next decision
The next step in your build sequence.