When comparing quotes between builders, it is important to compare apples to apples. By this, we mean ensuring that you are receiving an accurate description of upfront costs, and not something that has not been factored in all aspects of your build.
This way you can avoid paying a higher cost than you expected or being influenced toward a certain builder believing that they offered a competitive price, when in reality their quote didn’t provide you with all the expenses and inclusions up front.
You don’t need to talk to too many friends or neighbours to realise that quotes and actual costs aren’t always the same, which is why it is important to understand the different types of quotes to be able to accurately compare one builder to another.
Different types of quotes:
A Builders Estimate
What is a builders estimate? A builders estimate is often used early in the building journey. This amount is a very vague overview of what you can expect to pay. It is wise to think of this as a ball-park figure. An estimate is a rough indication that helps the buyer understand if this particular type of build is worth the potential cost and works with their budget.
Detailed Fixed Price Tender
A fixed price tender is what the builder has calculated the new home is going to cost, this will take into account the owners personal selections and may include provisional sum items which cannot be accurately costed. It is helpful to know that this tender needs an extensive amount of information gathered from suppliers, consultants and the owner’s selections.
A cost plus quote is where the builder has quoted you for his direct costs for labor, materials, and sub-contractors, plus a percentage to cover his overhead and profit. Material and contracted services throughout the stages of the build process and costs are passed to the owners, with an agreed margin to cover overheads and profits. It’s important to note that banks generally won’t accept cost plus quotes for finance.
A provisional sum is a quotation where the builder has quoted a portion of the build, however, has simply guesstimated a budget for certain parts of the build. For example, a provisional sum may have been allocated to a quote for excavation, however it is not a fixed quote and the price may change later in the build depending on the actual site conditions E.g. slop or depth of excavation.
When comparing quotes, it is important to ensure that you are comparing the same type of quotations against the same scope of work. Simply comparing the final figure may not be an accurate comparison, and most importantly cause stress, confusion, and money later in the build process.
A few red flags to look out for when viewing a quote include:
- Minimal information and detail
- No ABN and/or Builders Licence Number
- Overly cheap in comparison to other quotes
At Crighton Homes we understand that building a new home can be a daunting process which is why we spend a lot of time analysing each project to ensure that each quote is as accurate as possible. Our quotes are highly detailed so there are no hidden surprises and the actual cost to build aligns to the quote, so that you can manage your budget and avoid any nasty surprises.
It is also important to remember that choosing the right builder is about more than price. It is important that you choose someone that you believe that you can trust to communicate honestly with you and give you the time and respect that you need to be confident in your build. A builder who takes the time to understand your unique needs and why you are building can ultimately save you time, money, and stress.
If you’re looking for a custom home builder or would simply like to have a chat about building your new home please don’t hesitate to contact us – 1300 362 579.