Building Site Costs: Avoiding the Costs Dance
This week we want to take a look at Building Site Costs and what to look for when evaluating a price estimate to build your new home.
Reasonable Price Estimates
Most custom home builders strive to provide costs based on the best available information at hand. This includes taking into consideration the impact factors that their experience tells them is likely:
- sub-surface soil conditions
- The impact of the proposed earthworks
- Site access issues
- The location of services.
Defining Building Site Costs
Because there is a bit of confusion about exactly what included is meant by the term ‘Building Site Costs”, we thought it would be a good idea to provide some detail of what it means from our perspective.
“Building Site Costs” can be very simply defined as any costs associated with preparing the site for the installation of the foundation material of the home. A more detailed definition would be those costs associated with the necessary preparation of the site to begin building works.
Pricing & Inclusions
Most Inclusion lists tend to emphasize emotional items such as finishes, and PC Items. Very few mention the fundamental requirement that the site has to be properly prepared, and that the structure needs to be properly engineered. While the cost impact of these vital requirements can vary from site-to-site, a reasonable cost estimate should be provided for everyindividual site.
At AKS Homes, we automatically attempt to evaluate the expected costs (if any) of the following items for every price estimate we prepare.
- Silt Barriers – Erosion control
- Temporary fencing
- Energy Efficiency Certification requirements
- Additional cost due to setback over the minimum.
- Site Excavation
- Importing fill
- Tree removal
- Rock Removal
- Identification surveys
- Set-out surveys
- Gravel to Driveways and Paths
- Additional Drainage requirements beyond the minimum allowance
- Retaining walls
- Additional Slab costs
- Additional piers through Fill, or as directed by an engineered design
While it is true that many of these items will not apply to all projects, it can be ascertained at once whether an allowance should be included for in the pricing of the project or not.
Other “Known Unknowns”
It is quite common to hear about site costs that are impossible to predict. That is true, but they really should be limited to extremely unusual circumstances; the presence of a water table that is only discovered once piers are drilled; or drainage Pipes that are incorrectly logged on council bi-maps, some common plumbing issues (read more on the subject at plumbers-portsmouth.co.uk). While these types of situations are known to happen, they are unusual occurrences. It is not reasonable to expect that a Builder be aware of them.
It is reasonable however, to expect a builder to identify many of the other site costs very early.
We have heard stories of ridiculous sums being quoted for some site costs, often in excess of $10K. It seems that these costs are only revealed very late in the preliminary process, after a preliminary deposit had been paid, and after many weeks of preparation of working drawings and contract documentation.
This is not general Industry practice, and the vast majority of builders feel obligated to fully inform their prospective clients of a full range of the costs they could reasonably expect while building their new home.
At AKS Homes, we go further, and insist on providing comprehensive quotes well before you ever spend a cent with us. We believe this should be a minimum requirement you should expect from your builder.
Give us a test today. We guarantee the best possible price, quickly and conveniently.