Building your dream home is (or should be) an exciting adventure. Yet for many homeowners, the experience is tainted by unexpected costs. Nasty surprises (or ‘variations’ as builders like to call them) that can force you over budget and into financial stress.
Variations are more common and costly than you may think. Imagine budgeting $500,000-$1 million for your dream home and then having to pay an extra $25,000-$50,000 for driveway, fences, and landscaping you thought were included in the price. Plus $50,000 for unexpected site preparation. And another $10,000 because the floor coverings you wanted are no longer available and you have to choose a more expensive alternative.
This article seeks to provide common examples of variations and tips to avoid them so you can enjoy a smooth, predictable building process without unnecessary variation bills.
What Are Variations?
The term ‘variation’ refers to changes during the building process that justify additional charges. These changes may be:
- Mutually agreed upon variations (like modifications to the design or selections including fixtures, fittings, and appliances because you’ve changed your mind)
- Regrettable variations (like certain building materials or selections becoming unavailable)
- Unavoidable variations (like unforeseen site preparation expenses due to underground rock or asbestos, challenges that are only discovered during the demolition stage of a renovation, or extra regulatory requirements thrust upon you by council)
- Deceptive variations (like extra charges for things like driveway and fencing that you thought were included in the contract)
How To Avoid Expensive Variation Bills:
Detailed Planning and Preparation
Benjamin Franklin famously said, “By failing to prepare, you’re preparing to fail.” And he’s right. Methodical planning is the key to a predictable build. And the sooner you involve your builder, the better.
Share the vision you have for your home. Ask your builder to help you clarify and refine your ideas. And get them to explain all your options so you have the information you need to make confident decisions.
Once you have a plan in place (with your floorplan, features, and finishes all chosen), try not to change your mind. Or if you do, realise that each adjustment may cost extra in time and money.
If you’re unsure about a decision, ask your builder for a 3-D render so you can get a better idea of what your finished home will look like. If you’re still unsure, invest in a Walkthrough Plan, where your house plan is projected ‘life-size’ onto the floor and walls of a warehouse. You can literally ‘walk through’ your home and see how everything flows including the placement of your furniture. It’s the best way to visualise every aspect of your home before you build.
Clear Communication
Don’t let a misunderstanding lead to an expensive variation. Be clear about what you want. Ask your builder to confirm they understand by paraphrasing your wishes. And then get everything in writing so you’re not relying on fallible memories.
Systems and Processes
Building a home is a complicated endeavour involving a collaboration between dozens of suppliers, trades, and you and your builder. Something as simple as an ordering oversight (e.g. wrong tiles or forgotten appliances) can set you back weeks and thousands of dollars.
Professional builders avoid this by having a Project Management Platform (which they should give you access to). You’ll see when materials are ordered and delivered. You’ll see when trades are scheduled and completed. And you’ll be able to track every communication. This is the best way to know that everything is organised and running according to plan.
Thorough Site Inspection
One of the most common and costly causes for variations is site preparation. Underground rock, unknown water flow, and asbestos contamination can delay building by weeks and add tens of thousands in extra costs.
These things can’t be avoided entirely (as it’s impossible to know what’s underground). But a thorough site inspection (including soil testing) will help to minimise risks.
A professional builder will meet you at your block to carry out a site assessment. This should include optimising your plan to minimise site preparation and maximise benefits from natural light, breezes, and views.
Detailed Contract
Too many builders attract customers through unrealistically low prices. Then they rush you into signing a contract that is light on detail and heavy on fine print. This practice is known as ‘de-specking’. It leads to frustration and financial stress because you are forced to pay extra (sometimes tens of thousands) for things you thought were included in your contract price.
Don’t ever sign a contract unless it details exactly what you’re getting. If it’s not in your contract, don’t expect to get it. For example, triple check your contract includes detailed specifications and costs for site preparation, driveway, fencing, landscaping, exterior lighting, insulation, flyscreens, curtains/blinds, floor coverings, clothesline, letterbox, air-conditioning and more. Some of these things may seem minor. But they can add thousands to your contract price.
The only time it may be advisable to accept an ‘allowance’ in a contract (as opposed to a fixed price) is for items that suffer price volatility. For example, structural steel and timber change price weekly. If you demand a fixed price on these items, you may find you needlessly overpay as the price may decrease by the time your build begins.
Choose The Right Builder
While the tips outlined in this article will help you to avoid expensive variations, the most important thing you can do is choose the right builder in the first place. When you’re investing your lifesavings to build the home of your dreams, there’s nothing like knowing you can trust your builder.
Free Guide for Building Your Dream Home in Victoria
Whether you’re just starting to plan your new home, or you have your land and are researching building options, we invite you to download our practical guide to building your custom dream home in Victoria.
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