Last year, we were working with a builder, we had progressed through the design phase and thought we were ready to sell our home and get the ball rolling - yes, trick for young players there! The builder we had been working with was dragging their feet with the delivery of our contract pricing, however they assured us that we were looking to be on budget...hmmmm. So, as naive as it now seems, we did put our house on the market and eventually, after much chasing, we did receive our contract pricing, about two days before our auction. The build cost was coming in significantly over budget which meant one of three things; 1) we either needed to extend ourselves and our mortgage or 2) we needed to sell the house for more or 3) we needed to save more dollars or cut the build budget. Add this to the scenario where we were receiving offers for our current house which were less than we were expecting and this created quite a deep, dark financial hole. Being a chartered accountant, this didn't sit well with me at all, so we decided to step back, take the house off the market and consider our options - we are now thanking our lucky stars that we did.
We took the opportunity to seek out other builders and obtain comparitive pricing, this has saved us approximately 15% of the original quote. After speaking with friends who were either on the other side of the building process or much further along than us, we also thought it would be a good idea to make sure that our plans were through council while we living in our current home and not renting. This has been invaluable. It has taken us over 6 months to get through council, and from what I am hearing, this is relatively quick. Many friends in neighbouring councils have taken up to 18 months to get their plans through council. A school mum is building in a new land release in Melbourne's middle ring eastern suburbs, she sold her house a year ago, has been renting all that time and still has not broken ground. Working with builders, you will find that they include these items called "provisional sums" basically a provisional sum is an allowance for an item - this may go up or down and if the item is a significant proportion of your budget, this needs to be worked out to ensure that there are no nasty surprises down the track. In pricing with our new builder, there was a provisional sum for cabinetry - I was a bit sceptical about the amount. To get some clarity around the amount, I have had three or four, two hour design meetings with the cabinet maker to really work out what we are trying to achieve with the cabinetry and benchtops, this has meant that we can turn a provisional sum into a quoted amount, which provides greater certainty for this significant amount in the budget.
So, building lesson number 2 for us was to get those ducks in a row. Unless you love living with the inlaws or renting, it is wise to have all your plans and permits in place, have planning permission from the council, completed working drawings, electrical and mechanical plans, finances sorted and a solid contract price from a builder.
Thanks for stopping by,