How to Understand and Compare Building Quotes
Demystifying building quotes
Building your dream home or renovating your existing property is an exciting time. One of the most important considerations is how much it’s going to cost, yet it can be difficult to understand and compare quotes from different builders.
This guide will help you avoid unexpected surprises and feel confident that you’re getting good value from your investment.
It all starts with your builder
Before you even think about getting a quote, take some time to thoroughly vet your builder. Research their reputation, look at past projects and ask for references. Make sure they’re licensed, belong to a trade association, and have experience in projects similar to yours. A reliable builder will be transparent, communicative and willing to address any concerns or questions you may have.
Cost-plus versus fixed price
With a cost-plus contract, you pay for the actual costs of materials and labour, plus an agreed markup or fee for the builder's services. Talk to your builder about how they manage cost-plus contracts and how additional costs will be calculated and approved by you.
A fixed price quote is a set price for the entire project, giving you clarity and predictability. Make sure the scope of work is clearly defined to avoid any discrepancies later on.
Peaky Builders promise to give you an accurate fixed price quote with no hidden fees and no inflated prices. Our clients tell us that our proposals are easy to follow and have made their projects stress free.
Provisional costs and prime cost sums
The more information your builder has, the more accurately they can quote. If there are areas where there's a bit of guesswork involved, there may be some provisional sums and prime cost sums included.
Provisional costs are estimates for elements of the project that can’t be accurately determined at the time of the quote. An example of this is pricing the cost of earthworks – it’s difficult to know might be found under the surface!
Prime cost sums are allowances for specific items that haven't been decided on, such as choosing the kitchen appliances or lighting fixtures. It means there’s money in the budget for these items, but if you choose something more expensive or less expensive than the allowed sum, a variation will apply.
Check what's included
Beyond the overall price, it's essential to look at what’s included in each building quote.
Check all necessary tasks and responsibilities are outlined clearly in the scope of work.
Verify the quality and specifications of materials to be used.
Understand the proposed timeline for the project, including milestones, potential delays and completion.
Confirm that the builder will handle consents and comply with the Building Code.
Ask about warranties for workmanship and materials to protect your investment in the long term.
Navigating building quotes can be complex, but with the right knowledge and approach, you can make informed decisions for your construction project. By vetting your builder, understanding different pricing structures, clarifying provisional costs and prime cost sums, and checking the inclusions thoroughly, you'll be better equipped to compare quotes effectively. Remember, communication is key throughout the process, so don't hesitate to ask questions and seek clarification to ensure the best outcome for your project.
Peaky Builders are an approved NZCB builder, which means you qualify to apply for Halo, a comprehensive 10-Year Residential Guarantee. It provides much greater protection than both the Building Act and Consumer Guarantees Act.
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