One of the more difficult questions to answer early in a custom building project is also one of the most important: what is it going to cost?

It’s a question we’re asked regularly by clients planning a custom home in Forster, Tuncurry and the surrounding areas, and understandably, they want an indication as early as possible. The budget influences almost every decision that follows.

The difficulty is that a custom home can only be priced on the information available at the time. Early plans and ideas can give us somewhere to start, but there is quite a difference between an early estimate and the level of pricing required before we’re comfortable entering into a fixed-price building contract.

So, what actually happens between the two?

Accurately pricing a custom home starts with understanding what we’re building

Before getting too far into pricing, we need to understand the project itself.

The plans are obviously a big part of that, but they’re not the whole picture. The site, engineering, construction methods, level of finish and selections can all have a significant impact on cost.

We also need to understand what the client is trying to achieve and the budget they’re working with.

This is one of the reasons we like being involved early. It gives us the opportunity to look at the design and budget together while the project is still developing, rather than waiting until everything has been finalised to find out whether the two align.

An estimate isn’t just one person’s opinion

We use an independent estimator as part of our pricing process.

Their role is to prepare detailed take-offs and estimates based on the project documentation, but that’s only one part of establishing what a project will actually cost to build.

There is still a lot of project-specific information to gather.

We work with our subcontractors and suppliers to obtain pricing, particularly for areas of the project where the design, site or selections require specific input. Engineering needs to be considered. Construction details need to be reviewed. Selections need to be known, or appropriate allowances made where a decision genuinely hasn’t been made yet.

Jake also reviews the project from a builder’s perspective. That’s where experience and judgement come into the process: understanding how the design will be constructed, identifying details that need further investigation and making sure the pricing reflects the home we’re intending to build.

Selections play a big part in custom home pricing

Selections are a good example.

There can be a considerable difference in cost between two products that serve exactly the same purpose. Windows, flooring, appliances, plumbing fixtures, cabinetry and finishes can all move the overall price.

That doesn’t mean every last detail needs to be chosen before any useful pricing can happen.

It does mean we need to be clear about what is known, what isn’t and what assumptions or allowances are being used in the meantime.

Renovations can be different again

Existing homes add another layer because there are sometimes things we simply cannot confirm until work begins.

We can inspect, investigate and gather as much information as reasonably possible beforehand, but we can’t see through walls or know the exact condition of every concealed part of an existing building.

Where there is a genuine unknown, we believe it should be identified as such rather than treated as though the answer is known.

That’s different from leaving something unresolved that could reasonably have been worked out before construction.

When does an estimate become a price we’re prepared to stand behind?

For us, that happens once we’ve worked through the project in detail.

By the time we’re preparing a fixed-price building contract, we want to have a clear understanding of the design, selections, engineering, construction requirements and how the entire project will come together.

As Jake puts it, by that stage we want to know the job back to front.

That doesn’t mean building suddenly becomes completely free of unknowns. It means we’ve done the work we reasonably can before committing to the agreed scope and price.

That’s ultimately the difference between giving someone an early indication of cost and being ready to put a price into a building contract.

Both have a place.

They just don’t provide the same level of certainty, and it’s important to understand which one you’re working with at each stage of your project.

At Manning Homes, we build custom homes across Forster, Tuncurry and surrounding areas. Our process is designed to work through these details before construction begins, so that when we reach the fixed-price contract stage, the price is based on a thoroughly considered project rather than an early set of assumptions.

Planning a custom home?
If you’re in the early stages of planning a new home in Forster, Tuncurry or surrounding areas, get in touch with our team to discuss your project.