How To Compare Builders Quotes
Two obvious things most people need to consider when thinking about building or renovating, is using a reputable/reliably builders and also price. When thinking about price a lower price may help you at the front end of a job, but most builders are pricing from similar suppliers and labour rates. So something maybe missing or they maybe taking short cuts.
Firstly you need to find the right builders.
Finding the right builder to work with you.
Personality and working relationships are very important, as you will need to feel comfortable working with your builder.
Does your builder understand you needs and is he pricing of a scope of works or a plan.
Ask to see previous jobs or even better current work that is being done at the moment.
Has your builder provided you with a current copy of their insurance and a disclosure statement with the quote.
You will need to have a formal contract for all works over $30,000
Looking over Costs and Quotes.
Working out how you can compare pricing can be hard – especially if you have never done a renovation, house extension or new build before.
Here are a few things you should look for when comparing quotes and deciding which is best for your budget:
Is the quote Fixed or On a Changeable Bases.
Some companies will offer a fixed price for a specific job. This means they have considered your plans and how much it will cost and then quoted a price.
The benefit of a fixed price is just that – it is fixed. If work runs over the scheduled timeframe or materials end up more expensive, the builders will deal with these costs – so this will not cost you anymore than the fixed price.
If your quote is not a fixed price quote or an estimate, then make sure you talk to the builder beforehand about how you will deal with all costs. What Margin will be put on materials, how many hours will it take to do the works, how will additional costs be worked out and above all how will this be managed. You do not want to be left with a hefty unexpected bill at the end, which is normally the case.
Apples with apples
When comparing the quotes you receive, you need to make sure you are comparing similar things.
One price might look more economical at face value. But if a quote only includes some of the works that are required or uses lower quality products – then it might not be as good as it seems.
Also if a quote has low provisional cost sums or cost allowances that are not realistic then this will only cost more at the end of the day.
Look carefully at what each of the quotes are including. Make sure you are comparing apples with apples. I would recommend looking at quotes that are comprehensive and competitive rather than simply cheapest.
What is a Provisional cost?
This is an estimated amount placed in a quote / estimate / proposal that is subject to accurate pricing. This is used because the builder doesn’t know the exact price of an aspect of your plans.
If the actual cost goes over the Provisional cost then the client will be charged extra. Should the cost be under the sum then the client will receive a credit on this amount.
Examples of these can be:
Estimating the cost of fittings for bathrooms, kitchen design cabinets.
Items like earthworks, which a builder may estimate but have to adjust if a problem such as difficult soil is found once the work starts.
The more provisional costs there are in a quote, the more it is likely to change and potentially get more expensive as the building develops.
One of the best ways to ensure you get a competitive quote is to include as much detail as you can in your plans. For example, including electrical and plumbing plans with a scope of specific fixtures that you require. This can help you have a better understanding of the total cost. Give as much information and detail as possible, this will enable the builder to cost more accurately on a job and lead to fewer provisional costs.
While there is always likely to be a little difference in the quotes that you receive, reputable building firms shouldn’t differ wildly in their assessment of cost. If one quote does seem significantly cheaper or more expensive, you should look at it carefully to see why as there is always a reason.
If you are unsure about reading the quote, then ask someone you trust in the building industry. Or at least someone who is good with figures to go through the documents with you.
It may seem tedious to compare quotes so carefully. You are potentially about to spend a large amount of money with the builder you choose. So it is important to ensure you are getting value for money and work with the right team.
Why not get in contact to chat about your quote?