Construction management fees cost the average U.S. homeowner about $32,000, though fees range between $3,100 and $49,700. These fees are generally a percentage (5% to 15%) of the total project cost.
Typical construction management fees run $3,100 to $49,700, depending on the complexity and size of your project. More specifically, construction managers charge a rate of 5% to 15% of the total cost of your project. Therefore, more minor renovations may cost as little as $3,100, while more extensive jobs, like building a new home, could cost as much as $49,000 or more.
Construction management fees are very straightforward. In most cases, you’ll pay one flat fee based on the overall cost of your project. Construction managers typically charge 5% to 15% for projects up to $1 million, accounting for a significant addition to the cost of building a house. This means you’ll pay $12,500 to $37,500 in construction management fees for a project valued at $250,000 and $25,000 to $75,000 for a project valued at $500,000.
Charging a percentage of the total cost of a home renovation may be the most common practice, but there are a handful of possible construction manager fee structures. For some projects, such as those with a lengthy design phase, construction managers may charge an hourly rate until setting the total project cost on a percentage-based fee. In other instances, it makes more sense for them to charge homeowners a flat fee for phases of the project or the whole task up front. Here's an example of what to expect from each fee structure.
| Fee Structure | Standard Range |
|---|---|
| Project Percentage | 5% – 15% |
| Hourly | $45 an hour |
| Flat Fee | $3,000 – $50,000 |
Additionally, construction managers may break up payments in phases of the project depending on how long it takes to build the house. For example, they will set one rate for the design phase and another for construction. A retainer structure, however, requires upfront payment to cover potential charges along the way.
Generally, construction managers charge a higher percentage for smaller projects than larger ones.
For projects valued at less than $1 million (most residential builds), construction managers typically charge 5% to 15% of the value of the project. This translates to:
| Project Value | Construction Management Cost |
|---|---|
| $150,000 | $7,500 – $22,500 |
| $500,000 | $25,000 – $75,000 |
| $750,000 | $37,500 – $112,500 |
For projects valued at $1 million to $10 million, construction managers usually charge 5% to 9%. For projects valued over $10 million, construction managers may charge as little as 1% to 5%.
When you team up with a construction manager, the two of you are essentially splitting the role of a general contractor—you pay for materials and hire workers while the construction manager makes sure the job gets done correctly. However, construction managers can take on more or less responsibility depending on how much you want to take on. For example, if you don’t want to search for and interview contractors, you can let the construction manager do it. Just be aware that you’ll pay more for this convenience. “As the acting general contractor of your project, it’s your responsibility to make sure that every company and laborer that works on your house is properly insured,” says Bob Tschudi, Expert Review Board member and general contractor. “You should also ask your insurance agent if you need home renovation insurance to cover costs above the limits of your existing policy.”
Different types of projects carry different fees.
| Project Type | Average Cost | Construction Management Fees |
|---|---|---|
| Total Kitchen Remodel | $40,000 | $2,000 – $6,000 |
| Build an Addition | $170 – $200 per sq. ft. | $1,122 – $3,960 |
| Remodel Multiple Bedrooms | $18,500 – $75,000 | $925 – $11,250 |
| Build a New Home | $150,000 – $450,000 | $7,500 – $67,500 |
While construction managers and general contractors are similar in many ways, they approach their work and fee structure differently. General contractors typically charge between 10% and 25% of a project. In addition to overseeing the project at a high level similar to construction managers, they also hire and manage the on-site team, delegate the budget for materials, and ensure the successful build of the structure itself. General contractors tend to join the project later than construction managers, but their work is far more hands-on and higher risk, hence the higher price.
When you forgo hiring a construction manager, you can expect to save the equivalent of 5% to 15% of your project’s cost. If you’re building a home that costs $500,000 in labor and materials, that’s an extra $25,000 to $75,000 you don’t have to fork out.
While managing a large construction project isn’t the right option for all homeowners, there are still ways to save on construction management costs when working with a pro. Since these fees are expressed as a percentage of the total project cost, you can minimize fees by reducing the cost of the project. This could mean tackling some of the finish work yourself, opting for less expensive materials, or other budget-friendly steps to bring costs down.
Home is the most important place on earth, which is why Angi has helped more than 150 million homeowners transform their houses into homes they adore. To help homeowners with their next project, Angi provides readers with the most accurate cost data and upholds strict editorial standards. We extensively research project costs to develop the pricing data you see, so you can make the best decisions for you and your home. We rely on reputable sources, including the U.S. Bureau of Labor Statistics, academic journals, market studies, and interviews with industry experts—all to ensure our prices reflect real-world projects.
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Construction managers direct new construction and large renovations from the early design phase to the final inspections. Depending on the scope of each contract, they may manage the budget, oversee staffing, and ensure safety precautions throughout the process. Construction managers will both manage the logistics of the project from afar, as well as visit the site during and after the structure goes up.
In addition to overseeing new home builds, construction managers work on large renovations and major remodels. For example, they may work with designers and oversee the construction of a finished basement, kitchen renovation, or a home addition. They may also oversee large-scale remodels, such as the update of a historic home. Construction managers step into small projects for more specific assistance, such as building budgets and compiling the team.
A construction manager takes a birds-eye view of a project, often managing construction from the early design phase to the final inspection. A general contractor is a licensed professional who has the training to direct the on-site team, manage the budget, and oversee day-to-day progress. In many cases, they also take on the risk of the project going over budget.
