You’re ready to upgrade your space, but financial worries and contractor trust issues can make choosing the right renovation contract feel like a maze. Balancing budget certainty with flexibility isn’t easy. Want a straightforward budget with no surprise costs? A fixed price contract might be your answer. Prefer an adaptable approach that requires more trust but gives flexibility? Cost plus could be the way to go. Let’s explore which path fits your renovation goals. In the sections ahead, you’ll see how each contract works so you can choose with confidence and discover which path aligns best with your renovation dreams.

Contract Basics

This section explores the key differences between fixed price and cost plus renovation contracts, and how they impact budgeting and pricing transparency in Edmonton's renovation landscape.

Fixed Price vs Cost Plus: Key Differences

Fixed price and cost plus contracts represent two distinct approaches to renovation pricing.

Fixed price contracts offer a set cost for the entire project, providing budget certainty. The contractor assumes most of the financial risk, but may build in a buffer for unexpected issues. At Nuvo, our buffers are tighter than many contractors thanks to years of renovation experience, refined estimating, and process improvements that keep surprises to a minimum.

Cost plus contracts, on the other hand, charge for actual costs incurred plus a predetermined profit margin. This model offers more flexibility and transparency but shifts more financial risk to the homeowner.

The choice between these options depends on factors like project complexity, budget constraints, timelines, and risk tolerance.

Budgeting in Edmonton

Budgeting for renovations in Edmonton requires careful consideration of local factors and market trends.

Material costs, labour rates, and permit fees can vary significantly in the Edmonton area. To stay realistic, homeowners should research current prices and factor in potential changes.

Seasonal considerations also play a role, as winter conditions can impact project timelines and costs.

Working with a local contractor who understands Edmonton's unique renovation landscape can help create a more accurate and realistic budget.

Why Transparency Matters

Transparent pricing is essential for building trust between homeowners and contractors.

In a transparent pricing model, all costs are clearly itemized and explained. This includes materials, labour, subcontractor fees, and the contractor's margin.

Regular communication and detailed documentation throughout the project help maintain transparency.

Nuvo Construction prioritizes transparency in all their renovation contracts, ensuring clients understand every aspect of their project’s pricing structure, emphasizing clarity over cost plus models.

Fixed Price: Pros and Cons

Fixed price contracts offer predictability but come with their own set of considerations. This section delves into the benefits and potential drawbacks of this contract type.

Budget Certainty

Fixed price contracts provide a clear, predetermined cost for the entire renovation project.

This approach offers peace of mind for homeowners with strict budgets. The total cost is agreed upon upfront, reducing the risk of unexpected expenses.

Contractors, especially those with more experience, often include a contingency in the price to cover unforeseen issues, potentially leading to a slightly higher initial quote. Experienced contractors typically offer a tighter contingency compared to those who are less experienced, as they better anticipate potential challenges. Most projects incorporate contingencies to address minor unforeseen items.

Fixed pricing encourages efficient project management, as contractors are incentivized to complete the work within the agreed budget.

For complex projects, a detailed scope of work is crucial to ensure all aspects are covered in the fixed price.

Fixed Price Risks

While fixed price contracts offer cost certainty, they can have limitations.

Changes to the project scope after the contract is signed often result in additional costs. As a result, adapting the project as it progresses can be challenging. When unexpected issues arise, inexperienced contractors may feel pressure to cut corners to stay within the budget. At Nuvo, our experience and systems ensure quality is never compromised.

Inexperienced contractors may add higher markups to cover their risk. More experienced builders, like Nuvo, rely on proven estimating and risk-management practices. This results in more stable pricing and fewer surprises for clients.

In some cases, disputes can arise over the quality of materials or workmanship if these weren't clearly specified in the original contract.

Any changes to the scope of work are always handled through a formal change order. At Nuvo, we prepare a detailed write-up for client review and approval, ensuring every change is clear, documented, and agreed upon before work proceeds.

Cost Plus: Pros and Cons

Cost plus contracts offer a different approach to renovation pricing, focusing on transparency and flexibility. This section examines the benefits and considerations of this contract type.

Cost Plus Benefits

Cost plus contracts provide full transparency into project expenses.

Homeowners see a breakdown of all costs, including materials, labour, and the contractor's fee. This openness can foster trust and collaboration.

This model allows for greater flexibility during the renovation process. Changes can be more easily accommodated without the need for extensive contract renegotiations.

Cost plus contracts can be particularly beneficial for complex projects where the full scope may not be clear at the outset.

The contractor's expertise can be leveraged more effectively, as they're not constrained by a fixed budget when making recommendations.

Cost Plus Risks

While cost plus contracts offer benefits, they also shift more financial risk to the homeowner.

To avoid overruns, it’s crucial to set a clear budget range and review expenses regularly. Alongside this, homeowners should keep a contingency fund for unexpected costs. Finally, regular communication with the contractor is essential to stay on track.

Homeowners should ensure they have a contingency fund to cover unexpected costs that may arise during the project.

Regular communication with the contractor is crucial to ensure scope certainty and manage sensitivity to changing project details, which helps control costs. Planning on the fly often results in more work and increased expenses compared to outlining details in advance and minimizing changes before the project begins.



Choosing a reputable contractor with a track record of transparent pricing and ethical practices is particularly important with cost plus contracts.

Before signing an open book or cost plus contract, ask clear questions such as: Are fees charged before, during, or after the project? Does the contractor offer maximum upset pricing to protect you from runaway costs?

Making the Right Choice

Choosing between fixed price and cost plus comes down to your priorities — cost certainty, flexibility, and trust.

Why Nuvo uses fixed price contracts:

• Provides cost certainty for our clients.
• Streamlined estimating process built on years of renovation experience.
• Clear documentation and transparent change order procedures.
• Stable pricing backed by proven risk-management practices.

Why Nuvo avoids cost plus contracts:

• Less cost certainty for clients.
• Higher potential for disputes and budget overruns.
• Fees can be charged in ways that increase client risk.
• Misalignment between contractor and client goals on budget control.

Both contracts have their place, but the best fit depends on your project type and comfort with risk. Nuvo Construction helps Edmonton homeowners, professionals, and investors navigate these choices with full transparency and proven experience.

Ready to compare your contract options and plan your renovation with confidence?Schedule a consultation with Nuvo Construction today!