This Is Why Your Builder Needs To Know Your Budget: The Top 4 Reasons
Nothing is worse than designing your dream home and then learning it’s out of reach. We explain the top 4 reasons why your builder should understand your budget.
If you’ve ever worked with a custom home builder, you may have encountered the ‘what is your budget?’ question.
We recognise it can be a sensitive topic for our clients, some may find conversations about money awkward or confronting. The truth is, it’s crucial for your builder to understand your budget to create a home that suits your price range and needs.
Some people worry if they reveal their budget, a builder will overvalue the project. If you’re working with a reputable and professional builder with integrity, their goal is to provide excellence in service, so this categorically will not be an issue.
If you don’t trust your builder with your genuine budget from the outset - then you shouldn’t consider building with them. Walk away and find a builder who will work on your behalf. Your custom home builder should be someone you have a relationship and rapport with. Here, we explain the top four reasons why you should reveal your budget to your builder.
The Top 4 Reasons:
To Avoid Disappointment
It may surprise you to learn that many home designs never get built. Why? They were designed over the client’s budget.
It’s easy to get carried away with ambitious design concepts, but 6 to 12 months later, when you approach builders for quotes, you may discover the construction costs are beyond what you want to spend or can reasonably afford. After designing your dream home, this can be a devastating emotional, financial and timeline setback.
To avoid this disappointment, we recommend working with an architect who collaborates with a builder in the design phase to provide cost visibility from the start. This simple but fundamental difference saves money and time by transforming the relationship between builders and architects into an alliance which fosters not only creative collaboration, but importantly, budget control.
The architect manages the creative design and the builder and architect work together on tracking costs. When construction costs are monitored and checked in the design phase, the risk of budget blowouts decreases.
It’s also an opportunity to identify any construction related challenges early on. With practical input from the builder, potential issues can be ‘designed out’ before leaving the architect’s desk, saving time on rework at a later (and more costly) stage.
As your builder, we are capable of suggesting options to balance your wish-list with your budget. Sometimes, we can even lower your required budget
To Create a Tailored Quote
It takes a lot of time and research to accurately calculate a fixed price for a custom home. On average, our team invests 40+ hours preparing a formal quote. It’s a comprehensive process which involves several steps.
The first of these is meeting the client to understand all there is to know about their requirements for the project. For example, what type of flooring will be used? Will there be timber or aluminum windows? How about selections for doors, light switches and taps? All these items (and many more) require individual pricing to determine an accurate project cost.
A plot visit is also required. This is important to gauge the access to the site, availability of utilities such as power and water, and to view and take measurements of the gradient of the site, all of which can impact on cost.
Prices are then sought from subcontractors and suppliers, who quote for electrical work, plumbing, steel frame manufacture, etc. These are major components of any building project and an accurate price is needed.
Finally, there is calculating the quantities of materials and applying all the items that go into a build: blockwork, joinery, roof installation, insulation, appliances, painting and tiling - just to name a few.
As you can appreciate, it takes considerable research to factor in these costs and apply them to each individual project. It’s not a matter of cutting and pasting a previous quote. Therefore, a builder must be certain a client has a realistic budget before proceeding to detailed costs. Otherwise, the builder risks investing 40+ hours preparing a formal quote, to possibly learn the project isn’t within the client’s price range
To Suggest Alternative Options
If there’s something specific you want to include in your home, but your budget doesn’t allow for it, a professional builder will utilise their experience and existing connections to investigate alternative options that may be suitable for your project.
The more your builder understands about you and your budget, the more likely it is they can find you cost savings and a result that works.
To Add Value
If your builder knows the budget you’re working with, they can then look for ways to add value to your project.
This could be something from your home ‘wish list’ or even something you hadn’t considered as an option, such as alternative materials which cost less and perform better over time.
A professional builder will always be on the hunt to identify ways to achieve optimum value for your budget.
A Common Goal
Ultimately, the builder and client’s goal is the same - to get the home built on budget, on time and with 100% quality. When the builder-client relationship is established on mutual trust and clear communication, you’re more likely to achieve this outcome.
Keep in mind that a builder builds homes every day - this is what they know. They have a clear understanding of how much a new home actually costs, which is why it’s important to engage their services early in the design phase.
Ensure you do your research before inviting a builder to quote for your project and then be prepared to be open and honest about your budget to achieve the best possible outcome
For advice on how to calculate a realistic project budget, email our team.
How To Calculate Your Budget
Download our free manual to help calculate the true cost of building a custom home.Download Here