Budgeting For Your Dream Home Budget is the most limiting factor...
Budgeting For Your Dream Home
Budget is the most limiting factor for the vast majority of homeowners looking to build. It’s said in the industry you can have anything you want – as long as time and money are unlimited. Congratulations if you’re in that top 1 per cent!
For the rest of us, we need to determine how much we can afford to spend on our construction project.
The biggest mistake most people make when planning a dream home is not understanding build costs. It’s very easy to think that $1 million is lot of money for a home but if that has to include everything from GST to fees of all the consultants, you are actually left with significantly less for the actual build cost.
Budget allowance calculation example;
1. A 300-square metre house built at $3,000 + GST per square metre= $900,000 + GST 2. Luxury items: for a heated swimming pool with cover and self-cleaning capability, allow and extra $100,000 + GST 3. Landscaping and fencing: allow an extra 15% = $135,000 + GST 4. Existing house demolition and site preparation: allow an extra $20,000 + GST 5. Architect’s fees including interior design: allow an extra at 12% of $1,115,000 = $138,600 + GST 6. Other consultants and fees: allow an extra $20,000 + GST.
TOTAL BUDGET ALLOWANCE = $1,363,600 + GST = $1,499,960
From the above example, we can see that someone with $1 million wanting a 300-square metre house might assume that they are ready to proceed, but after considering all factors, they might in fact be almost half a million dollars short.
The result might be that you hope to build the dream home for $1 million but, if you had to, you could go to $1.3 million. Exceeding $1.3 million would lead to trouble of the sort that does not go away in a hurry, and you’re not prepared to do it. Remember to factor this in – before a hammer is swung or a tree is felled, there will be money going out the door, including the cost of quotation, the cost of the early concept design and the cost of the full documentation including detailed drawings. Then there’s permits and approvals – it adds up, so make sure you allow for these in your budget.
When you have your budget, don’t keep it to yourself. Tell your builder exactly how much you have to spend, because the builder understands costs and has the experience to know whether what you want can be built for that budget and – usually – the common sense to tell you when it can’t.
Engage your builder at the design stage
Architects and designers come up with some great designs, but only your builder knows what it is going to cost. Don’t rely on your architect or designers cost estimate, as all too often the design does not match the clients budget.
Don’t spend thousands of dollars on designs and DA approvals only to find the build is not what you intend to spend.
And particularly when it comes to home renovations, don’t rely on m2 calculations, as every renovation is different and there are too many anomalies.
Experienced builders can discuss a project in brief and have a gut feeling for the overall costs within 20% of accuracy.
Start Planning your dream build today and Contact Spannenberg & Son https://www.instagram.com/p/CEkX1dwlOWX/?igshid=10vuaif9txxaz
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WHY CHOOSE US
At Spannenberg & Son, we bring traditional family values to every home extension and renovation we are entrusted with. As one of the longest running construction companies in New South Wales, we delight in bringing our experience and quality service to families throughout Sydney’s South-West and Northern Beaches elevating one home after another to meet their potential and your lifestyle goals.