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Media Release |
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Cost Blow Outs Major Issue for Owner Builders
Thursday, 31 March 2011 10:39
The thought of being able to reduce the cost of building a home or renovation has become increasingly attractive to many new home buyers and renovators facing the increasing costs of living.
However, the gains can be quickly lost once the project begins, according to Archicentre, the building advisory service of the Australian Institute of Architects.
Ian Agnew, ACT & NSW State Manager of Archicentre said cost blow outs are the major threat for owner builders. Archicentre has found about one in three requests to Archicentre for assistance related to renovations, design and cost blow out issues for renovators once projects started making it more expensive to correct. "This can easily happen as managing and being responsible for a renovation or building a home is a complex task requiring an understanding of plans, materials, subcontractors, insurances, and safety on site." Mr Agnew said however, taking all that into account, being an owner builder can be a rewarding experience providing careful planning, costing management and paperwork, especially contracts with subcontractors, are in place to ensure orderly and timely progress. "One of the biggest mistakes owner builders make is that they get a quote only on the structural part of the renovation or new home, failing to recognise that around 50% of the cost is to be found after lock up in fittings and finishing. "This can leave people financially exposed and unprepared for the potential cost blow out and disruption caused when half way through the renovation they require more funds to complete the project. "A lack of good planning can ultimately lead to confusion between the owner builder and the subcontractors if the project, including price and material specification, has not been properly documented in the beginning. Mr Agnew said Archicentre is often called in to resolve disputes which should have been avoided with appropriate planning at the beginning and independent quality checks at milestones in the building process which are importantly linked to subcontractor payment schedules. "The planning for the owner builder should commence at the design concept where the design is settled on and then properly costed so accurate quotes can be obtained to avoid variations. Variations where owners change the plans from the agreed specifications and quote, can be extremely costly adding thousands of dollars to the project and are best avoided with thorough planning at the design stage," Mr Agnew said. "Whilst comparative quotes provide a good guide to the cost of the project, choosing the cheapest quote may not necessarily be the right decision. You need to do your homework to ensure the subcontractors you involve in your project have the training, experience and skills, have appropriate insurance, are able to show examples of their work and importantly are able to complete the project on time. "The completion on time becomes a major issue if you are paying rent on another property whilst yours is being constructed, and failure to complete a renovation on time can add thousands of dollars to the cost. "Make sure your quotes are carefully documented and specify the entire project so everything can be costed accurately and planned. This is an area where Archicentre often assists owner builders get started with a design report leading on to the specifications of types of materials and cost effective structures. From experience with owner builders around Australia, Archicentre has found the owner builder who works through their design carefully, has it accurately costed and uses independent quality inspections and reports at milestones such as foundation, framing, lock up and handover usually has a satisfactory outcome. Mr Agnew said, however, in some instances where proper planning and management of a renovation program is not carried out carefully, a property can be unfinished and the owner left with an expensive course to fix the original renovation, or experience a costly legal battle. "As an owner builder, if you are thinking of a renovation or a new home design, the Archicentre Design Concept is one way many people utilise to get their ideas started and plan together with the help of an architect experienced in the type of renovation or home design required. This Archicentre Design Concept Report can save considerable amounts of money by providing information on getting the best return for a renovation, answering the basic sustainability questions and importantly advice on the necessary construction program to cut down on budget blowouts. It can also provide a guide for the type of tradespeople you will need to subcontract." Archicentre publishes an extensive cost guide for renovators at www.archicentre.com.au Media Enquiries:
An owner builder on site at the renovation of a property
This in turn can lead to a stalled project, breakdown in communication with the subcontractors required to finish the job and often an impasse that can develop into a lengthy legal dispute."
Ron Smith, Corporate Media Communications, Archicentre - Mobile: 0417 329 201