Cost-plus Contract
Agreement in which the contract price to build something is equal to the total costs incurred plus a predetermined profit. The profit may be based on a percentage of cost (e.g., 20% of cost) or a flat profit figure (e.g., $60,000). This type of contract is not good for the buyer because the contractor may intentionally overstate the construction costs to obtain a higher profit figure when profit is determined based on a percentage of total costs. If the construction costs are $100,000 and the percentage of profit is 25%, the total contract price will be $125,000.
Popular Real Estate Terms
An organized group of ethical behavior guidelines governing the day-to-day activities of a profession or organization. ...
Individual or business transferring a right or benefit to another person or business. ...
Founded in 1942 and located in Washington DC, the NAHB has 155,000 members with 824 local groups. Its membership consists of single, multifamily and commercial home builders. The NAHB ...
Frame surrounding a door or window to block adverse weather. It may be made of wood, metal, or other material. The frame may be fixed or moveable. ...
A public area, or plaza with a series of walkways permitting pedestrians easy access to shops, stores and restaurants. Modern malls are often enclosed enabling all weather access. Malls are ...
An acronym stating the real estate is the I.D.E.A.L. investment. Each if the five letters in IDEAL stands for an advantage to real estate as an investment. "I" stands for interest ...
Under a FHA-insured mortgage, both the property and the borrower must meet certain minimum standards. The borrower is charged an insurance fee of one-half percent on the unpaid balance and ...
Drain facility usually underground for waste and water disposal consisting on connected pipes. ...
Person or entity that has title or a right to something which is typically being held. Examples are real property, corporation, and personal property. Ownership of property may be held by ...
Have a question or comment?
We're here to help.