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Hidden Building Costs

Posted on Jul 4, 2017

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By Natalia Rietveld

When looking to build your own home or renovate your existing home, if a quote looks too good to be true, chances are it probably is. More often than not builders will leave out certain costs to bring their overall quote price down to secure the job. Here are a few things to look out for on your next quote.

 

ASBESTOS REMOVAL

When tearing down the old and building anew or when renovating your existing home, asbestos is one to look for. In any home that was built before the year 2000 make sure it has been checked for asbestos. If asbestos is present a specialist team will be required to remove it. These costs can escalate quickly.

 

ENGINEERING

The main engineering costs are usually in two areas – structural and foundations. If plans have not been finalised, a ‘PC sum’ will need to be allowed.

For foundations a geo-tech report needs to be provided to the engineer so they can work out what is required for your project to meet, or exceed the NZ Building Code.

For the structural engineering, the plans will need to be provided to the engineer so they can determine what size, specification, and spacing of timber or steel frame work is required for your project to meet, or exceed NZ Building Code.

Engineering costs are not cheap and can ramp up considerably depending on the complexity of the job.

 

TEMPORARY SERVICES

Site fencing, site toilet and a temporary running water supply are now basic health and safety requirements on many construction sites and these are usually a week-by-week renting cost.

Scaffolding is also another big cost to keep an eye on. Waiting for plans/consents to come out of council and weather and contractor delays can drag out the timeline of your project, adding to the overall costs of the temporary services.

 

SITE PREP COSTS

A lot of house package costs are associated with a “flat and level site”. If your section is undulated and hard to get vehicles and machinery to, bottom line is, it will cost you more to build on.

If your main contractor hasn’t been to check out where the project is to take place, you can assume they have priced it as a “flat and level site” which can end up in arguments around the extra costs associated with the build.

 

PC SUMS

Just be aware if the quote has a lot of Prime Cost sums (PC sums) in it. Some PC sums are to be expected as it may not be possible to have an exact cost at the time, but just check that the PC sums are relevant, and ask other people or professionals that you know in the industry, if the PC sums are enough to cover or close to covering what they are allowed for.

 

COUNCIL FEES

Check in your quote to see if the main contractor has included any council fees. Council consents may be required and you may even need a resource consent, or have to pay a development levy.

 

GST

Is your quote GST inclusive or exclusive? That’s a 15 percent difference which on a $600,000 house and land package is roughly $78,000.

 

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