Pointers to success with building projects; The hidden costs of building part 2

The hidden costs of building Part 2

As well as basic build costs involved in the actual construction of a new build there are a number of “secondary “ costs that are often forgotten or miscalculated during the budgeting stage such as connection to services and insurance.

  1. Design costs

Architects fees can cost as much as 15% of the total build cost for a full design and supervision service. However there are plenty of good Architectural Technicians around who will design a property for £2-3000, its then up to you whether you then engage them to supervise the works to ensure that the job is carried out in accordance with the specification. For obvious cost reasons, many builders do not take up this option.

Be very aware that the design and specification of your build can massively increase your budget by anything up to 50-100%. You therefore need to brief your designer properly on the overall budget that you have in mind and ask him to think carefully about your financial resources when designing the property.

Design Fees: Architects charge 7-15% of the total build cost for a service involving design and supervision. For planning drawings from other sources expect to pay from £2,500-£3,500, plus a further £2,500-£3,500 for Building Regulations drawings

  1. The Specification

The specification you adopt will have significant impact on your budget. Consider for a moment that you can easily spend between £500 and £1000 per 1000 on your bricks, £10 to £40 per m2 for roof tiles, and £5000 to £25000 (at least!) on the kitchen.

You can see therefore that quoting “standard” square footage costs can be nonsense… it is perfectly possible for the square footage costs to vary between at the very least £1200 and more typically £1500 per square metre, depending on the quality of finishes (and the level of supervision provided by professionals). With higher quality finishes that could easily rise to £2000-2500 m/2 that is why it is so important to get the project priced either professionally by an Estimating Service or estimating package like EstimatorXpress

  1. Connection to sewers & other services

The cost of connecting to local services depends much on your proximity to the highway and location of the mains. Be wary of moving services on site as this can be a huge expense. A local electricity company once wanted £25000 to move an innocuous cable and transformer which crossed one of our sites.   Fortunately, they were able to demonstrate this to the vendor and negotiate a reduction on the land. Make enquiries before purchase!

Typical connection fees for water, gas, electricity, telecom and drainage £3500-6000

  1. Insurance

As a building firm you will already know you need to be adequately insured for public liability, employer’s liability and contract works insurance. The cost of claims resulting from thefts from site or accidents far outweighs the cost of insurance in the long run.

Many of your sub-contractors will have their own insurance but we wouldn’t recommend on relying on this. Plus as I am sure you’ll know you will also require a structural warranty (most purchasers of new homes will want this) or you could save a bit of money and go the Architects Certificate route, but many would-be purchasers will be put off this as many of the high street banks will not lend against new homes which only have an Architects certificate – HSBC will not lend on any new property with an Architects certificate for example. .

Public liability, employers liability and contract works insurance £500-1000

Structural Warranty £700-1500.

This article was written by Adrian Wild, founder of HBXL Building Software and the HBXL Estimating Service.