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Are Volume Builders really Cheaper? Watch Out for Hidden Elephants

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Are Volume Builders really Cheaper? Watch Out for Hidden Elephants
When you see that advert for a new home or visit an Open House and get excited by prices, pause and breathe deep. The prices you are seeing are not what it will really cost to build your home. Why? Well, the fact is with Volume Builders there’s a lot of Hidden Elephants.

Hidden Elephant 1: Site Costs
Site costs are the expenses involved in preparing land for building, and they are a very large item to leave unmentioned. In fact, they are one of the most profitable areas for Volume Builders, yet they are not even discussed until you have put some money down. Your salesperson will probably be someone with no experience in the building industry – other than sales, so they don’t know the technicalities, and their job is to get you across the line. It’s only after you have paid an initial deposit that potential site costs are disclosed.
On average, for a flat and easy-to-build-on block, take the list price and add 20% for site costs. If you have a block with up to one metre of slope, this will mean $25,000 minimum in additional costs; if the fall is over one metre quotes may reach $60-180,000. These figures generally indicate that the Builder doesn’t want the hassle of a sloping block. But if you aren’t aware that there are affordable alternatives, you may feel that your dream is turning into a nightmare.

Hidden Elephant 2: What That Display Home Isn’t Displaying
When you walk into a beautifully presented display home, what you see does not equate to what you will get from advertised prices. Buyer Beware! Your imagination is being clouded by $100,000 worth of furniture. Unless you’ve budgeted for all those beautiful extras, your home will be a different picture. It will also feature some $50,000 of upgrades and fancy landscaping. So look beyond the glitz and glamour, forget the designer items and garden fountains, and put that display home in perspective; on your block, with your budget.

Hidden Elephant 3: Quality
There is an enormous difference in quality between Volume Builders and Custom Builders. When purchasers see Caesarstone bench tops and porcelain tiles, they equate this to quality. This has nothing to do with quality; this is just upgrades. The only important aspect of quality is the actual construction. In building, as in most things, you get what you pay for. In this case, it’s what you pay your trades. The rates paid by Volume Builders can be up to 50% lower than what a Custom Builder pays. Consequently, for the trades to make a living, they get in and out quickly. If the initial slab is badly laid, the framer finishes best he can and moves on, and everyone else has to compromise too. This won’t equate to the house falling down. But there will be tell-tale evidence: gaps, cracks, rooms out of square, doors that don’t close properly, bad tiling. Those details and repair jobs fall short of the quality you thought you were paying for.

Hidden Elephant 4: The MacMansion Delusion.
Volume Builders have the capacity to build enormous houses comparatively inexpensively. BUT, you have to furnish it, heat it, cool it (and clean it.) To show off their new mansion, the family has a big expense in furniture, curtains and other accessories waiting for them.

But the real costs are heating and cooling all of that space. In winter, heat migrates upstairs. In the summer, bedrooms are hot, and the costs of air conditioning will make your eyes spin. Unless windows are double-glazed you will need heavy draperies to maintain warmth. Your bargain MacMansion is revealing very bad thermal performance and there are huge utility bills. Heating costs may be double, and cooling triple, the price of a smaller, well-built home. A beautiful house only needs to be as big as you need for yourself, your family, your lifestyle.

Are Volume Builders really cheaper than Custom Builders who give you a tailor-made outcome? Look past the marketing, do your due diligence and ask a lot of questions about those hidden elephants, before you choose the right builder for your home.

Do you value integrity, communication and superb quality throughout the building process? Do you have a question about your block or dream home?  John Kearney is a Melbourne Building Design and Construction Consultant who has been in the building industry for over 20 years.  He is passionate about giving people a cost effective alternative to building in the areas they love, and specialises in solutions for difficult and sloping blocks. Find out more at http://slopingblocksolutions.com.au/  Tweet with John at SBSBuilder and Like his Facebook page to get tips, updates and a bit of humour!

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