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How much margin should builders be adding to their projects? 15%, 20%, 25%? Its a question that has both divided and confused the industry since the dawn of time. The answer is that it depends on the niche. Large commercial builders reportedly operate on net margins of around 1%, complete madness that exposes the company to rising costs and minor estimating mistakes. However, residential builders enjoy far larger margins with most large companies consistently producing 10% plus in net margins. The reason they are able to produce double digit net profit year on year is because they get their builders margin correct, which is the amount of gross profit added to each job. ing to a 2022 report by NYU Stern which analysed 29 home building companies, the average builders margin was 24.87%, which enabled those businesses to enjoy a net margin of 12.73%. However, while most residential building companies do not currently add 25% to their projects, those that do will still not get close to c
