And is it worth hiring an designer or should you customise a Home Builder's standard plan instead?
Read on, as in article we'll summarise:
How Volume Home Builder's keep prices low
What extra costs are incurred when designing a custom home
When you might just opt to edit a Home Builder's standard plan and (Coming soon)
When working with an architect or building designer could be for you. (Coming soon)
Quick Note: If you'd prefer to find out how custom house construction costs can be calculated check out our other blog post instead: What does a Custom House Cost to Build
Introduction
Building a new house is a goal many people and families share for the freedom that it allows. After all what's not attractive about tailoring a unique design to suit you're needs, budget, lifestyle and personality?
The other attractive opportunity is to make most of what your property has to offer, with a well considered architectural response, which is what so many houses do poorly.
Many home owners realise that while there are cost saving available by working with a home builder, typically the creatively, personalisation and level of finish offered is limited. To overcome this they opt to hire an architect or building designer for the freedom and comprehensive design process they can provide.
However, a reason for hesitance or anxiety to entrust a design professional with this creative task can stem from fear of blowing the budget. This concern can arise as the design process can appear to be completely disconnected from construction pricing. Floor plans no longer have build costs at the bottom of the page and there are no package deals to choose from.
A home builder's catalog and optional features list seems to explain pricing so easily in comparison that it can feel like a real risk to design a custom home. When speaking with a designer it's easy to believe the sky is the limit as there are no prices on the floor plans, engineering details or artist impressions.
To help minimise the fear of not understanding construction costs, we'll shed some light on both how home builder's save money and how designing a home from scratch will be more of an upfront investment.
How Volume Home Builder's typically keep prices low:
Minimal Design Fees: The house design is essentially already done, likely designed by in-house staff on salary, which is cheaper than paying a third party building designer or architect's fees. Any changes you make will be relatively simple, essentially only editing what that have already prepared.
Less Uncertainty: The builder has overseen the design and knows with more certainly how much it will cost to build. They may have built the house multiple times before and have since adjusted the design to iron out complexities or custom aspects, which may or may not be a good thing for the long term use of the home.
Less Engineering Fees: The structural engineering design is 50% done, just the foundations and wind ratings need to be confirmed for the property its been built on this time. The engineering is typically less complicated so the need to call, engineers out to site for inspections or to resolve queries is typically avoided.
Less Site Research: The builder might not conduct a detail survey for accurate existing site measurements, or spend time understanding the natural features of property personally, two things an architect or custom designer would want to invest in.
Basic Approvals: Home builders tend to avoid requesting any applications from council if they are avoidable. Self Assessable (in QLD or Complying Development (In NSW) are approval pathways builders prefer as they are quicker and reduce the preliminary design fees. A longer approval process just increases the risk the client won't end up starting build.
Standardised Construction: The designs they offer are more simple to build to keep their labour costs low. There might be some expensive items installed like Bifold doors or a feature ceiling lining, but more custom 3D building forms such as cathedral/vaulted ceilings, split level floors, and custom sliding batten screens are less common.
Buying Power: They either buy their materials in bulk or have ongoing connections with suppliers that afford them discounts thanks to the volume of the purchase orders
Control: Home Builders are essentially in full control of the whole process. You might not even be allowed on the construction site for almost the whole build! If they need to save money somewhere, they can adjust technical things that their contract doesn't specifically clarify about the design, and you wont ever know. An architect's specification will be much more restrictive to ensure high quality is maintained in places the owner cannot easily see, but would appreciate.
Target Market: Clients who have the budget to build bespoke or luxury houses don't typically buy from Volume Home Builders, so the product they do offer is aimed at their target market's price range - which is typically lower.
What extra costs are incurred with a custom home?
Below are some of the key extra costs that surface when designing a custom home:
Design Fees: Architect or Building Designer fees
Interior Design fees: (if not included above)
Detail Survey fees:
Structural Engineer fees: For a custom structure beyond the scope of a frame and truss suppliers design ability
*Private Town Planner fees: (if lodging a Development Application)
*Extra council fees: for Setback Relaxations, Build-Over-Sewer, Operation of Works etc
*Specialist Consultant fees: based challenging text book regulations/solutions eg Civil Engineer for building closer to a waterway
*Quantity Surveyor fees to independently estimate building costs (Typically recommended)
Extra framing, steel or concrete costs: for more complex and custom building shapes, varied rooves, ceilings, large openings and spans and custom or specialty wall types
Landscaping: Most custom homes include more elaborate or expensive landscaping, hardscaping and front fences that are better integrated or suited to the house design
Pool: Most custom homes include a more expensive pool that is better integrated with the house design
Extra council fees: Setback Relaxations or Build Over Sewer applications with council add fees and time but can really improve the design outcome perhaps by allowing better views or greater floor area in more desirable parts of the property.
*Tender fees: or Custom Builder's Preliminary service fees
Less discounts: on materials due to smaller scale customer builder company's buying power
Selections: Custom homes have almost no restrictions on material selections, so the sky is the limit for material costs. Home builders manage their material and finish options just as any retail shop manages what it offers for sale to suit its target market. Without this restriction it is very easy for home owners to decide they want something they can't afford. Future full blog post about this coming soon
Fat in the builder's quote: to cover the unknown aspects of any construction complexity.
Property Costs: *Land holding costs and alternative accommodation during the preconstruction process. The build will likely take longer too extending these costs into the build.
*May not be relevant to all projects.
While these two lists may make you rethink the benefits of working with a designer, rest assured that if the appropriate steps are taken, you should still be able to build a house to a budget
Provided your budget does allow for the extra costs of building a custom home, there are key strategies used in the preconstruction process to forecast, review and confirm construction costs.
To find out how custom house construction costs can be calculated check out our other blog post instead: What does a Custom House Cost to Build
Extension to this article about the below topics coming soon.
When you might just opt to edit a Home Builder's standard plan and (Coming soon)
When working with an architect or building designer could be for you. (Coming soon)
However there is some more useful information in our FAQ page
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