Everything You Need To Know About Working With A Builder
How do I find a great builder for my home?
The best ways to find a builder are by asking friends, neighbours, architects or real estate agents for recommendations, or observing the work sites of nearby projects.
‘A drive around your local area looking for building sites that are neat, have nice signage, and a tidy nature strip out front is a good start. It’s not a sure sign of a good builder, but if they care enough about their site’s presentation, then surely that’s a good indication of how they manage their business,’ says Rhys Vleugel, director of Basis Builders.
You can also ask to speak to some of the builder’s previous clients for a direct testimonial.
‘If a builder is unable to get you to walk through a past project or speak to a past client, then that is not a great sign!’ says James Gooley, director of Visioneer Builders.
The next step is interviewing multiple builders to ensure your values and expectations for the project align. For example, if you’re hoping to have the entire project wrapped up by Christmas, mention this upfront!
James also recommends asking whether the builder has completed projects of similar scale and complexity before and whether there will be a full-time site manager or one managing multiple projects at once.
At what point of a residential project should I contact a builder?
When exactly you should start contacting prospective builders slightly depends on who is involved in the project. For example, if you’re looking to complete a relatively simple bathroom renovation, a builder may be the first and only design/construction professional you contact.
‘Traditionally after your plans are complete, you might have an initial consultation with a builder to discuss the project, and then provide the documentation for them to tender on,’ explains Rebeka Morgan, director of BuildHer Collective. ‘However, there are many ways of running projects, and we are seeing more of our clients looking to value manage their project by getting builders in on the design phase, to both ratify costs and suggest some cost management to the structural works.’
In the case of BuildHer Collective member Maddie Witter, she started working directly with a builder immediately upon purchasing the home she planned to renovate, alongside Co.Kitchens in the initial phase to design her kitchen.
‘When I purchased the home, I put it as part of my settlement to be able to visit the site three or four times before closing, so that the builder could actually start giving me advice, and we could start building that floor plan,’ Maddie says.
For residential projects where an architect is involved, a builder will usually come on board soon after the very initial design plan.
‘Having the builder on board during the first steps opens the doors to early engagement with subcontractors allowing us to take advantage of their specialised knowledge,’ explains James. ‘Crucially, it also allows for realistic conversations around the build time and budget.’
Never Stop Group director Damien Collins says contacting a builder at this early project stage allows for a high-level price estimate and clear discussion about the overall intent.
‘A practical starting point is to send them over to their local Reece showroom to browse through their options for fixtures and fittings,’ Damien says. ‘This gives us an idea of whether they are looking for the top-of-the-line tapware, or just something simple, functional and high quality.’
Will a builder also help to design my house?
The answer to this question again depends on what parties are involved in the project. If you are working with an architect or other designer, a builder will likely only provide advice on construction methods or materials, but won’t be heavily involved in determining the aesthetics of your home.
If however you are working directly with a builder only, your builder may be more hands on in determining the best layout, materials and fittings for your home.
‘If you are working from less detailed documents, or you are running the design and selection of finishes alongside the build, you might work closely with the builder to resolve details,’ explains Rebeka.
A good builder will also identify any potential issues in the initial plan, and understand the design intent of the project.
‘As detailed as the architectural packages generally are, not everything can be completely drawn. It’s important that a builder does not make design decisions without consultation, but they definitely have a role to play in the “buildability” of these details,’ says Rhys.
What is involved in a building contract?
A building contract outlines exactly what a client can expect on a project, including costs, timelines, and how variations and delays from both sides will be handled.
‘Building contracts are in place to clearly outline what is “in” the scope, and therefore what is “out”’, explains Rhys. ‘They protect the client in a sense that the builder is legally obliged to deliver everything that is in the contract documents (such as plans, details and specifications). They form a “line in the sand” cost wise, as often variations arise (client driven or latent conditions) that were clearly not allowed for in the contract set of documents.’
James offers additional advice. ‘Always ensure you have a completion date in your contract and a rate for “liquidated damages” should the builder not finish the build by the contracted end date. Try to not have many “special conditions” and if there are any, ensure you have a legal representative review the proposed conditions prior to agreeing.’
Most importantly, James says, ‘If your builder is telling you that you don’t need a building contract, then you are speaking to the wrong builder!’
How are builders’ fees calculated?
Pricing your project involves obtaining fee proposals from professionals for services, or sourcing estimates, quotes or tenders from builders or tradespeople for labour and materials.
Tender documentation is a specialised set of drawings and specifications that enable any builder to price your project. As a client, this allows you to easily compare costs between multiple builders.
Alternatively, you may prefer to finalise the details with the trades as you build. The more information you supply, the easier it is for a builder to price reliably, leaving you less open to financial risk.
Fees are structured differently from builder to builder, and are sometimes presented as a lump sum, or a percentage of the total construction cost.
‘Fees, or margin, are calculated as a percentage of the total build cost, typically between 10-15%. This fluctuates slightly depending on the project, considering risk and the size of project,’ says Rhys for Basis Builders projects.
Damien says Never Stop Group’s overhead and operating costs account for 7% of their fees, with 3% profit on top, amounting to a flat 10% percentage fee (i.e 10% of the total construction cost). Beyond this, the company provides a detailed ‘trade breakdown’ that details separate costs such as carpentry, plastering, plumbing, painting and electric.
Total construction costs vary significantly. Of the builders spoken to in this story, the total construction cost of projects ranged between $80,000 (for a small extension), up to $10 million+!
How long will construction take?
The length of the construction period is obviously dependent on how large and complex your project is, but also how often your builders are on site.
Damien advises establishing these facts upfront. ‘Ask them about their company structure: what support do they have in the office? Who will be on site each day to manage the quality of the work? Do their projects operate daily or will it be done in spurts, with lulls in activity on site over time? We often pass by sites which sit idle for weeks and months at a time and we wonder what the poor clients must be thinking.’
The number of employees within the company will also impact how quickly projects can be completed.
Visioneer has 34 employees and three directors, which allows them to build between 12 to 15 projects at the same time. Each project has a minimum duration of around 12 months, but can be up to 36+ months for larger projects.
Basis Builders’ average construction time frame is 14 months and they run four projects concurrently.
Never Stop Group usually have 8 to 12 projects being built at once (with the same amount in the tendering and design development phase), and their average build-time is around seven to eight months.
‘As a rule of thumb, most of our projects take about one month per $100,000 of value. Therefore a $700,000 project would be about seven months, whilst a $1 million project needs around 10 months,’ says Damien. ‘A good builder will communicate with you honestly and provide you with a detailed timeline based on your specific project.’
How can I avoid budget blowouts and other issues?
We’ve all heard nightmare stories about house builds gone wrong, but these can always be overcome with the right team, mindset, and communication.
The best advice for avoiding budget blowouts is to lock in material and product specifications before building.
‘Don’t change things once the project has commenced! There is a misconception that builders love variations, whereas I can assure you, Visioneer do not!’ says James.
Damien also recommends a cost contingency of around 5% of the total build cost. He finds only 1-2% is usually required due to existing conditions, with the remainder spent by the client on upgrades. In other words – without contingency, budget blowouts often occur because you’ve selected something additional (fancy tiles/kitchen bench/floor coverings/whatever!) along the way that is out of scope, or more expensive that initially specified in the building contract.
Last by not least, trust your builder. Damien says, ‘At times, a project in progress may not look the way you had dreamed it would, and you may second guess the plans. Try and step back to allow the whole process to come together!’
Reece helps turn one day delaying into day one of your building or bathroom renovation journey. Discover the work of local builders from across Australia on Reece’s Project Inspiration Gallery.