What is a fixed-price renovation contract?

A fixed-price renovation contract sets the total cost before work begins, giving you budget certainty. It includes a detailed breakdown of materials, labour, and subcontractors.

What is a charge-up renovation contract?

A charge-up (cost-plus) contract is based on actual costs plus a builder's margin. The final price can increase as the project progresses, leading to potential cost overruns.

Which contract type is better for Auckland renovations?

For homeowners wanting budget certainty and clear timelines, fixed-price contracts are usually better. Charge-up contracts offer flexibility but can lead to higher final costs.

My Architect Has Sent Concept Drawings: What Happens Next?

17 Feb

Written By Rob McIntyre

Q: My wife and I just got our concept drawings back from our Architect. They are for our renovation and extension project in St Mary's Bay. This is our first time renovating and we really have no idea what we are doing. What do you recommend we do from this point?

A: Undergoing your first renovation can be a very nerve-wracking time. But if you follow my advice you will find it easier than you first thought.

Establishing Your Renovation Budget and Researching Costs

Firstly, it is extremely important to work out what your maximum budget is. Unless this is your forever home, and the only time you will be moving out is to a nursing home or cemetery, you need to ensure that you won’t be overcapitalising, which can happen even in St Mary’s Bay.

Once you know how much you can spend, try to get an idea of what your project is going to cost. Talk to people who have done similar work, check out online tools or have an informal chat with a local builder. Renovation and building project costs can vary a lot. This depends on where you live and the materials you choose.

Key Expenses to Factor Into Your Project

You will need to factor in costs for:

Labour of builders and other trades
Building materials
Fixtures and fittings i.e. curtains, carpets etc
Insurance: the cost of a policy to cover renovation work can be up to two times your annual house cover. Speak to your insurance company early to make sure you budget enough
Arrange alternative accommodation

If you visit Building Guide, they have plenty of resources available including a budget calculator which you may find useful.

Engaging a Quantity Surveyor or a Building Company

Now that the research is done, it is time to get an indication of cost. You can get this from an independent Quantity Surveyor (QS) or from a residential building company, like Next Level Construct.

If you are not ready to hire a Builder or haven't found one you like, I suggest using the independent QS. Hiring their services early in your project will ensure that your Architect's plans fit your budget. The QS will prepare your estimate using their knowledge of residential buildings. They will also use costs from similar projects they have priced.

The benefit of using a QS is that they can offer advice on cost saving measures. You can then ask for these changes to be made on your Architects final plans.

If you are looking for an independent QS, we highly recommend the services of Nick Clements from YourQS. Nick on 0274 433 732 or nick@yourQS.co.nz.

The Advantage of Early Involvement with a Builder

The other option is to engage the services of a residential building company. The sooner a building company gets involved, the better. As we will be able to share our years of experience and knowledge.

We can help with cost planning and building methods. We also focus on value management and reducing project risks. With your approval, we can give our recommendations directly to your Architect

We at Next Level Construct use a QS, who will also prepare your indication of cost using their knowledge of residential construction and our database of existing jobs. I highly recommend that you work with a building company that employs the services of a QS.

Managing Cost Indications and Final Quotes

If the cost estimate is higher than your budget, don't give up on your dream home. Work with the independent QS or construction company. Together, you can find ways to cut costs.

Look for areas where you can make changes to save money. As I mentioned above, both the residential building company and the independent QS will have cost saving measures.

It is also important to remember that no matter who you use, at the concepting stage these costs are only indications and not a full fixed price quotation. Although both an independent QS and a residential building company will be as accurate as they can be, sometimes there will be a difference in price between the indication of cost and the full fixed price quotation.

This is because there is more detail in your final plans, compared to concept drawings especially when it comes to the structure: which can add costs. The best thing you can do is be open and honest with your Builder, Architect and independent QS if the price is out of your budget; they are experts and can help advise where savings can be made.

About Brendon Sowerby and Next Level Construct

Brendon Sowerby is the Founder of Next Level Construct. An award-winning end-to-end residential construction company specialising in renovations, extensions and new builds. Brendon has worked in the building trade for over 17 years, meaning he knows the ins and outs of the industry.

Got a building question? Ask Brendon on brendon@nextlevelconstruct.co.nz or call us on 021 568 655.

Rob McIntyre