Your Building Project Budget

What is generally not included in your project budget?

First you should note the items that are related to your project but are not usually included in your project budget. They include:

• The cost of purchasing your land or a building that you plan to renovate or modify in some way.
• Finance charges, such as those associated with taking out a loan.
• Legal / solicitor’s fees.
• For alterations and renovations projects take note of furniture removal and storage costs and your accommodation costs.
• If you have a home office or your project involves modifications to your business premises, then take note of potential business interruption costs.
• When you obtain cost estimates you should note if they include GST. Alternatively, after estimating your budget add 10% for GST.

What is usually included in your project budget?

Producing a project budget is a specialist professional service offered by a Quantity Surveyor, and is outside our expertise. However, we are here to help you get it done.

Items to include in your building project budget include:

• Our fees, Consultants’ fees and Certifiers’ fees
• Construction cost estimates: are usually expressed in terms of cost of construction per square meters. These are very rough estimates at the start of the design process since the details of the project are not yet known, and sometimes not even the Design Brief is known.
• As a very rough guide, for your Starting Budget, assume that the construction cost for a house project, in Tasmania, will be somewhere between $1800 and $3600 per square meter, if your site is not steep and there are no subsurface ground issues. Add another 15% to 30% for Energy Efficient, Supportive, and/or Healthful building design, and/or building in a bushfire prone area with BAL less than BAL 40.
  • During the Design Process, we strongly recommend that you engage a Builder or Quantity Surveyor (who will work with us) to produce cost estimates at the different design stages.
  • This will help you to select one of a number of design options during the Schematic Design stage, and later to make sure that your preferred design is still within your Budget during the Design Development and Construction Documentation stages.
  • Safety Margin: Give yourself a 20% to 30% safety margin above the quotes that you receive from the Builder, especially in the early design stage, since the Builders’ quote, will be based on drawings that do not include any details and there will be assumptions made that will probably change during later design stages; and some Builders tend to underestimate the building cost during the early design stages to secure your interest.
• Authority fees: Local authority fees, statutory fees, and special insurances.
• Project Variations: refers to changes made to the Design Brief and your approved design during the building Design Process and/or during Contract Administration. These variations tend to result in additional fees for producing new design drawings and associated construction drawings, submissions to the local Council, additional Builder’s fees, additional building materials and components, and any costs of returning/exchanging materials and components already purchased. Although it is best not to make any variations once the project has been approved by the local Council, it is sometimes unavoidable, and it is sometimes beneficial.
  • For instance, rock might be discovered when the footings are being excavated, or a rotten wall / floor is found once renovations begin. Such issues will need to be addressed, and may present opportunities for a different design.
  • Design opportunities might also emerge after the construction begins and you decide that you want to change the design, after you experienced the emerging building project.
• Contingency allowances: these are amounts put aside for unforeseen circumstances or items that are not yet known. An additional 15% to 20% of the construction cost should be allowed for. These allowances will decrease as the design and build progresses because more will be known about the project.

• Contingency allowances are generally made for:
  • changed market conditions at different stages,
  • unknown issues that come to light during construction, such as subsurface rocks or rotten structure in an existing building.
  • costs of delays due to bad weather, industrial delays, and delays while obtaining approvals.
  • Project variations
  • discrepancies that may appear in the project documentation during the construction process.

• Keep your contingency allowance in reserve as part of your project Budget, but not as part of or referred to in your construction contract. You can then use this amount to:
  • deal with your Builder’s claims for variations,
  • additional payments to your Building Designer for making changes in the documentation as necessary.

• Special Items: The more special items that you list the more accurate your budget will be. For instance you might like to obtain the cost of your kitchen appliances, bathroom fittings, furniture and soft furnishings. A simple web search and/or a visit to your local supplier can provide you with pretty good estimates, that can be easily adjusted up or down as the project progresses.

Design and Build Process and Our Associated Fees:

In helping you bring your building project aspirations to life,

• we design your building project based on your Design Brief,
• we help you select a suitable Builder,
• we help you Administer Your Contract.

Our preferred design approach is to incorporate some combination of Supportive Design, Healthful Design, Solar Passive Design, Passivhaus Design, while meeting your design aspirations.

Our associated fees are:

• Design Fees for meeting your building aspirations
• Builder Selection Fees for assisting you in finding a suitable Builder
• Contract Administration Fees for ensuring that the building project complies with the terms of your Building Contract and protecting you from paying for building work that is not yet completed.