Cost To Build A New Home: Part 2
Sleight-of-Hand Tactics When Providing a Cost to Build a New Home.
Last week we had a look at the reality behind the ‘volume discount’ claim when providing a cost to build a new home. It is not the only sleigh-of-hand practiced by some of the largest builders in Australia to disguise the actual cost of building one of their ‘Standard’ House designs.
Talk to any honest builder, and they will tell you that they cannot really give you a ‘price’ to build a new home off the cuff. They will however always oblige with indicative costs. Such estimates are always heavily qualified because the final price depends on the quality of the inclusions; more importantly, by what is actually included in the quoted price. So a good builder will want to sit down and give the plans and spec and good workout.
A project builder building standard home plans, on the other hand, will always have a price list available, along with a professionally printed ‘List of Inclusions”:
“$189,970- Finished in our designer range of inclusions”
“Does that include everything we see here?”
“Yes it does; except for the floor coverings, decor, light fittings, driveways and landscaping. A few of the fixtures only come with our lifestyle range of inclusions. Here, let me give you the ‘list of Inclusions’ and a ‘Price List’. Where were you thinking of building?”
One can see how easily it is to then assume exactly the opposite to the written information provided. You would be forgiven if you believed that the price covered everything, apart from the items specifically mentioned.
Inclusions & Exclusions Are What Defines Your Cost To Build A New Home
Here is just a sample of the unmentioned exclusions .
A good part of the Council Application fees is often not in your cost to build a new home. It is not unusual for there to be only a nominal allowance for the actual council fees – sometimes as little as 30% of its true cost
• Any of the vaguely identified ‘site costs’, are often not in your cost to build a new home.
- Silt Barriers – Erosion control
- Builders Signage
- Temporary fencing
- 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
These are what can be referred to as the “how could we possibly know” costs. While it is true that many of these items will not apply to all Projects, it is passing strange
that you only find out about them after considerable initial expense. While it is impossible to predict in its entirety the exact cost associated with the slab & engineers design without that design; a good builder will at least get it close most of the time.
- Energy Efficiency Certification requirements
- Physical Perimeter Termite barrier. Many builders only include a nominal drainage penetration barrier, and rely on a visual barrier – i.e. you visually check it every time you’re in the garden.
- Ceiling Fans – essential for energy certification without installed air-conditioning
- Rainwater Tanks
- Wall and roof sarking
The above items are always required due to regulations governing the average Australian and Queensland home. They should be a standard in every home, and should be included in every cost to build a new home. They should at least be added at the very first stage of the prelim process – before any money changes hands.
- Higher ceilings
- Feature Front Door
- Specialist doors such as glass bi-fold doors
- Light fittings AND additional light points
- Additional electrician installed power and cable points like Foxtel.
- Feature Balustrades
- Rendered & Feature Brickwork.
- Stained Timber Staircase. (Usually will only be carpet grade)
- Kitchen upgrades will not normally be included except where it is included as a “special” giveaway.
- Cabinets to the Laundry
- Glass splashback to the Kitchen
- Floor-to-ceiling tiles to bathrooms.
- Tiles/concrete or decking to the alfresco.
These items can be classified as lifestyle selection items, but are often missing from the Inclusions list because builders try their utmost to project an image that their brand provides better value than their competitors.
Larger builders often colour this tendency by provided a truncated version of this list as a free ‘upgrade’ or a cut-priced upgrade. These special upgrade packages often obscure the fact that an essential item is not in the inclusions list.
For instance, you may that you receive $60K’s worth of items for $3K, but the obligatory rainwater tank is not on the list. Or else it is the Termite proofing. Or that it costs almost as much to engineer the slab as it would have cost in the first instance, leaving you to wonder if there was a slab allowed in the first place.
INVESTING TIME, MONEY, & EFFORT MAKES IT HARD TO WALK AWAY
You may wonder why people would not walk away in disgust, since they have free will and can choose who they give their business too. The answer is that these omissions are only revealed in stages, and after the client has invested several thousand dollars and a considerable amount of time in the discovery process.
It is unpleasant, but after all the time and money invested; they could well believe that it was normal practice in the building industry, and that they would only be taken for a similar ride were they to try an alternative builder.
This is not the case, 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.