In today’s post, we share more information about architect service pricing. In 1990, due to the United States v. The American Institute of Architects, Civil Action No. 90-1567, the American Institute of Architects (AIA) was prohibited from offering fee recommendations to architects or architectural firms. In other words, the business must operate like everything else in the free market. It means prices for goods and services are self-regulated by sellers and buyers. Since architects can develop competitive fees, standard pricing does not exist.
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For anybody who has never worked with or hired the services of an architect, the way they’ve come up with any specific dollar amount to charge their clients may seem like a well-guarded secret. Without standard pricing determined by an authoritative organization, architects act independently when calculating their rates, and the calculation often boils down to pure competitive pricing to attract clients.
Architects have the freedom to come up with any number they see fit. Whether the number is high, low, or average, clients must be well-informed about the type, scope, and amount of work that goes into a project. Only then can you gauge what architects deserve for their efforts and if the services provided justify the pricing.
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According to the U.S. Bureau of Labor Statistics, architects plan and design houses and other structures. Architects have a preliminary discussion about any project to do the job properly with the clients. The meeting usually involves the scope of work involved, objectives, budgets, and requirements. The architects might also provide predesign services, including cost analysis, environmental impact studies, feasibility, and site selection. These are usually for commercial projects like office buildings or factories and are applicable in residential projects.
Following the preliminary discussion, architects develop construction plans that show construction details and the building’s appearance based on the initial proposal. The details include technical drawing designs of various HVAC, electrical, communication, and plumbing systems. If a landscape plan is required, the architect can provide that too. Architects design and carry out every part of the project, from the construction process to the structural systems, following building codes at both local and state levels. They can also handle the building permits for you.
Some architects resort to hand-drawing, at least for the project’s conceptual phase and when making sketches of desired changes during construction. When finalizing the architectural plan, they will always turn to CAD (computer-aided design) software to ensure the drawing is accurate and easier to read or understand. Several 3D rendering designs of the building may be necessary for presentation purposes.
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Clients can ask architects to help prepare the construction bid document, select contractors and negotiate the terms of construction contracts. Architects may visit the construction site throughout the project to supervise construction. They ensure that the contractors follow safety guidelines, meet the desired quality standard, use the specified materials, and achieve the design plan.
To summarize, architects handle much more than drawing an architectural plan. They also prepare detailed construction documents, oversee construction works and safety, and conduct the necessary tests to see if the building is exactly as the specification suggests. It is not unusual for architects to work with other professionals during a project, i.e., engineering consultants. A project is considered complete when the construction process and necessary tests are done, and all workers are appropriately paid.
Just because you have a construction project coming up, it is not always necessary to call an architect right away. However, hiring an architect service is best when you find yourself in one or more of the situations below:
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Whether or not your project needs an architect, there are always advantages to retaining one. Architects are skilled professionals with specialized training to address construction-related challenges and walk you through complex regulatory requirements. This includes building permits, building codes, and zoning laws.
Now that you know more about an architect’s scope of work, it’s time to become familiar with some of the basic pricing structures they most commonly use. Regardless of which one you select, talk about the options with your architect before moving on to the project’s next step.
It is a straightforward concept that professionals in all industries use. In this fee structure, architects bill you for their hours working on your project. Most architects use hourly rates simply because they get paid for all their work. Even if there are changes that mean the previous results are removed from the plan, the hours spent on the discarded part are still billable.
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Hourly rates vary depending on project complexity, location, and experience level. In an architectural firm, there are at least four architects of different qualifications; each comes with a specific role and rate as follows:
Architects indeed love the idea of an hourly rate, but often they need to practice some reservations when deciding how much to charge. Some clients find it difficult to believe the amount of billable hours, especially when the fee structure incentivizes architects to work longer than they need to.
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Clients can control how many hours an architect can work on any specific portion of the architectural project by adding an NTE (not-to-exceed) clause in the contract. The clause limits the number of hours and maximum cost the architects have at their disposal to get the job done. It is also possible to use the hourly rate only for the conceptual phase and then switch to another more permanent fee structure once the scope of work and project timeline can be better defined.
For a large project costing tens of thousands of dollars or more, the most preferred compensation method is usually a percentage-based fee (a percentage of overall construction cost). A significant challenge with this fee structure is predicting the overall cost at the beginning of the project. Here is how it works: a client hires an architectural firm to deliver an architectural design.
Once ready, the firm sends out the design to any number of contractors and invites them to make a bid. The cost mentioned in the document is a mere estimate until this point. The client selects the most appropriate contractor, and they will set a separate contract. Prices indicated in the contract (between client and contractor) already cover the architect’s fee. Architects have their methods for determining the percentage, but on average, the rates are:
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The percentage-based fee is a sliding scale that corresponds to the estimated/actual construction cost. A large project takes a small percentage, and a small project calls for a sizable chunk. Generally, the renovation and remodeling project commands the highest fee just in case the architects bump into some challenging “unknowns” during construction. For example, an otherwise simple garage remodeling can turn into an engineering nightmare if the existing building is constructed according to local codes or has inadequate quality.
When an architect charges less than the average rate, the services only include essential works such as plan drawings and obtaining permits. If they charge on the upper end of the spectrum, you should expect a full package service that includes drafting services, 3d rendering architectural drawings, and more from the start until completion.
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Some architects charge on a per-square-foot basis for small projects, especially new construction. New small projects are easy to estimate, both in terms of time and scope of work. With this pricing structure, you can expect to pay around $20 per sq. ft. (most likely cheaper). You will be charged an additional fee if you need the following:
Remember that revisions may account for the additional area even if the location is unchanged. If there are too many revisions, architects may switch to an hourly rate after renegotiation.
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A pricing structure preferred by most clients, fixed fee or lump sum, provides transparent information about the cost of the architectural service upon signing the contract. It erases any doubt and removes the anxiety that may come with an hourly rate structure, and budgeting is much easier to manage. Architects typically use a flat fee structure for small projects because the scope of work and the timeline can be more accurately defined from the start.
Not a lot can go wrong in a small project or when you only ask for a specific service, such as concept drawings or 3D floor plan designs. In either case, the architect’s work is more defined. With that in mind, architects will not want to settle for a fixed fee structure unless they can accurately predict what the project will entail. Until the agreement is reached to use the compensation method, an hourly rate applies first—at least in the initial stages.
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A fixed fee structure is beneficial for both the client and the architect, and they already know the exact amount they will pay when the project concludes on the client’s side. Furthermore, it also incentivizes the architects to work efficiently. It makes no sense to drag things longer than necessary since they receive the same amount of fee regardless of how slowly or quickly the project takes.
Getting it done as soon as possible allows them to move on to the next project. For architects, a fixed fee requires the clients to clearly define the work scope or the standard type of services. If a service is not mentioned in the contract, the architect has no obligation to provide it.
Architects offer their services on a wide range of projects, large and small. When using a fixed-fee structure, the cost depends almost entirely on the level of complexity. Remember that a large project such as brand-new construction that involves complex design services is often less challenging than a remodel project. A large project does take a lot of money, and a portion of that goes to cover the associated architect’s cost.
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However, the actual dollar figure represents a small percentage of the construction budget. For example, an architect may ask for $2,000 for a relatively simple remodeling project that costs $10,000. The number is small, but it is still 20% of the budget. On the other hand, an architect asks for around $25,000 for a new residential building worth $200,000. At this rate, the architect’s fee is only 12.5% of the budget.
| Project size | Drawings (only) | From drawings to completion |
| Small Project | $2,000 – $5,000 | $5,000 – $8,000 |
| Remodeling | $3,000 – $9,000 | $12,000 – $20,000 |
| Home Addition | $4,000 – $9,000 | $15,000 – $20,000 |
| New Construction | $10,000 – $30,000 | $25,000 – $70,000 |
Cost continuously varies depending on the building’s specifications and location. Talk to your architect about the fees per project type and how the calculation leads to the specific amount charged. If it makes more sense to use any other compensation method, renegotiate the terms with the architect. Make sure you agree to everything before moving forward with the project.
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You have better chances of a successful construction if the project’s entirety is overseen by an architect from the site design phase to completion. The charges will be much less if you only need a custom architectural plan drawing, and the contract ends right there. You will either have to hire another architect or handle the rest yourself, from choosing a contractor to overseeing the construction.
A plan drawing alone costs anywhere from $2,500 to $8,000, and it does not include additional services such as revisions and other construction documents. The next step involves taking the plan to a builder or general contractor. If modifications are required, you must retain another or the same architect to have a new drawing done. Retaining the service of an architect only to create a CAD drawing can work so long as you already have a trusted contractor to materialize the plan.
A complete construction document, including the blueprint and structural systems, bill of materials, and several 3D rendering designs of the house, can cost around $30,000 for a 2,500 sq. ft. home (about the size of a tennis court). A full service will include drawing revisions, project management, consultancy, and construction oversight. You will pay a lot more money, but you can ensure that the finished product will be as planned. The cost for full service is around $70,000.
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Service | Average price range |
Architectural plans, 3D renderings, BoM, structural systems drawing | $2,000-$30,000 |
| Full service – plan drawings & revision, project management, construction oversight, engineering consultancy | $5,000-$70,000 |
If things don’t go as planned along the way, an architect hired to provide full service will help you figure out the issues and offer the solutions without additional contracts or renegotiation of fee structure. The downside is that most architects will quote the highest possible number in anticipation of such issues.
Even when working on the same project, architects can propose a different compensation method as the construction progresses. During the first few weeks, architects often employ an hourly rate fee structure while still in the design phase. The point is to encourage clients to provide all the required information and documentation in an expedited manner.
If there are known challenges that may affect progress at a later date, the clients must communicate the issues during the initial design phase. The architects can then figure out a workaround before the project starts. Once the 3D real estate design or architectural design is ready, there can be a renegotiation about the fee structure, whether to stay with an hourly rate or switch to another option comfortable for both parties.
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Regardless of the compensation method employed, you must set a realistic expectation of what you can get with the available budget. It is not uncommon for a client to ask for a $100,000 project when the budget is only half the amount. A discrepancy between the client’s expectations and what the architect can do with the budget is common in the industry. Most clients do not understand that not every penny of the funding will go into the construction.
A reasonable portion is spent to cover soft costs such as obtaining a building permit, site analysis, environmental impact report, bidding process, or new equipment. So, if you have $100,000 to spend, only about 80% is for the actual construction. A good architect and contractor will take the time to explain everything to you upfront.
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When hired to provide a full service, an architect traditionally goes through a five-phased approach to the design and construction of the building:
During this first design phase, the architect and the client discuss project requirements provided by the latter. Based on the information, the architect conducts preliminary analysis, including but not limited to feasibility studies such as zoning regulation and building code issues. Another vital process during the schematic design phase is an overview of spaces that will ultimately go into the building. The architect also considers the spaces’ size, functions, and relationships. Schematic Design accounts for 15% of the architect’s work/fee.
The next phase is design development, in which the architect and the client work together to select building materials, interior finishes, and products like windows, appliances, fixtures, and doors. At this point, the architect will refine the rough sketches of the first phase to give more detail and specificity. Structural systems drawings also come along, for example, plumbing, electrical, HVAC, and project-specific requirements. Engineering designers and consultants may be involved in the drawing process. Design development takes 20% of the overall work.
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The largest of the phases is the construction document, where the architect and engineers finalize the technical details of the plan. All products and materials used in the construction are selected and scheduled. The selection process is more thorough and is based on the inputs from engineering consultants involved in the previous phase. Construction documents will account for 40% of the work.
Bidding is a pretty self-explanatory phase, and this time the architect only provides assistance for the client in answering questions from contractors (bidders). A client can also select a contractor without any bidding process. The architect may provide additional documents upon the bidder’s request, and it only accounts for 5% of the work.
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The final phase is construction administration. Although it is the most time-consuming phase, the work intensity is not as much as construction documents and only accounts for 20% of the work. On a typical project, an architect does not directly supervise construction work. There will be periodic visits to check on progress and whether the contractor is doing everything according to plan. The architect may verify the contractor’s monthly invoices to confirm progress.
All architects are professionals bound by a code of ethics, yet it pays to be careful with your hiring decision. Working with an architect is more complex than a business relationship because you trust someone with your home. It is always best to know that you are getting the most out of your money. A good architect shows genuine interest in your project, can work together, communicate well, takes pride in the profession, and can handle the scope of work required. On top of that, the architect has proven experience and technical expertise with a strong portfolio.
The AIA (American Institute of Architects) suggests asking the following questions to your architect before starting a project:
All the questions may sound casual, but no architectural firms are exactly alike. Each has a specific approach to design and handles every project with a unique method; all translate to the final product.
Since you pay for all the work done in the project, you may think that all the drawings are ideally yours. Sketches, blueprints, 3D rendering design services, and plans DO NOT belong to the client, at least according to the AIA’s standard architect–client contract. Everything belongs to the architect, and the client is only granted one-time use (during the project) of the copyrighted plans. In the event of construction defects, architects are not allowed to tell their clients about the mistakes. That said, the liability for the defects falls on the contractors. The architect can look for the most efficient solutions for minor errors that do not require major revisions.
At Cad Crowd, we have the privilege of working with some of the best architectural design freelancers in the world. If you’re looking for help with your project, please contact us for a free quote.
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