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GMP (Guaranteed Maximum Price)
A GMP is a contract structure that sets a maximum price, with rules for what happens if costs go above or below.
Why it matters
GMP can protect the homeowner from unlimited cost growth while still allowing flexible scope development.
Where people get this wrong
GMP still depends on clear scope and clear allowances. A GMP often includes assumptions and exclusions that must be read carefully.
Real-world example
A homeowner wants cost-plus transparency but also wants a guardrail. GMP can be that guardrail, as long as the assumptions are real and written down.
Where this hits your build
This comes up early, before construction starts. It affects your contract, your budget, or both. Misunderstanding it can cost you money or leverage.
Most people do not just struggle with terms. They struggle with the decisions tied to them.
See how HouseChalk helps with the decisions behind terms like this