Planning a new build
Embarking on a new build is incredibly exciting – perhaps the biggest benefit is creating a home with every detail custom designed for your lifestyle. What a dream! But building is also a complex undertaking. Unlike renovating, your build will need to meet newer, more rigid building and compliance standards. There are also a lot of unknowns to navigate like cost, design, and timeframes. And you need to find a great builder. I need a lie down already!
The most common issues to derail your building project are issues with the site, the project taking longer than expected, unexpected variations adding cost, a dispute with the builder or issues with quality. The best way to minimise these is to understand as much as you possibly can about the contract, process and what to do if these issues arise. So, grab a cuppa and have a read of my top tips to planning a new build and signing a building contract.
Finding land and planning for your new build
Use a lawyer
Building is more complex than renovating and therefore involves more paperwork and legal processes. Before you buy a section discuss the legal details with your lawyer, i.e. the certificate of title, information in the LIM and council files, and the terms in the sale and purchase agreement. Keep in mind your lawyer can also check on zoning, help negotiate the price and advise you about the best ownership arrangement for your circumstances.
Connect with the council
Talk to the council early to understand the nitty gritty details about your land, what’s possible in terms of design and positioning on site, and what consents you’ll need. The council can give you a PIM (project information memorandum) with all the recorded details of your site to make planning and design easier.
Find your type
The information from the council will give you a better understanding of the type of architect and builder you need. It’s a good idea to hunt for experts that work in the realm of new build that you’re planning to do – for example, a rural site might need a septic tank and own water supply.
Research design
Check out homes you love in your surrounding areas, sketch up ideas, look at inspiration online, and start to build a folder of reference images for design features you love. These can include design styles, colours, materials and interior features, and are helpful to show your architect to give them initial direction. For inspo head to HouseoftheYear.co.nz
Form a budget
A common question you’ll get asked (and the hardest one to answer) will probably be “What’s your budget?” Like it or not you’ll need to form one early on or you can lose loads of money before anyone’s picked up a hammer. Without an idea of budget, the architect is free to design a masterpiece you may not be able to afford, and the plans are ditched as soon as they’re priced up. Major factors that will determine what your new build will cost are the shape and size of your home, site access, number of stories, the type of building materials, complex shapes, bespoke details and going underground . Once you have a total budget – remember to hold some back as a contingency – unforeseen issues can arise in any build, and you need to be prepared.
Engaging a builder
It is important to find the right builder for you. You should find a builder you can trust and is backed by a trusted brand, like Master Builders. Speak with several builders to find one you feel comfortable with and have experience in new builds and areas similar to yours.
Master Builders represent the best of the industry, they can help you assess the project, advise you on the best approaches and products your build. You should also ask them about the potential issues and challenges, so you can prepare together, this includes timeframes, how you will manage variations and product substitutions. You should also discuss the level of finishing you require. MBIE provides a guide to tolerances for the building, if you want your project to be at a higher standard than this, you will need to discuss it with your builder, as it may cost more. See below for more on tolerances.
This is why finding an experienced builder early is crucial, because all these factors can affect how your plans are drawn up and what they will cost – and that can make or break a project from the beginning. I believe the best project outcomes are from a collaboration, when the homeowner, builder and architect or draftsperson are working together from the start (and the interior designer of course!) to achieve the right outcome for you.
Documentation
You can tell a lot about a person by their paperwork! Your chosen builder will present you with a contract specific to your project, but they should also show you proof of liability insurance, required permits, building licenses and property and personal injury protection for their workers. Check these are valid, have a good read, and ask as many questions as you need until you fully understand the contents. It’s also a good idea to keep copies of all these files. Remember, your contract is a legal document between you and your builder, and in the end it will be the responsibility of you and the builder to resolve any contractual disputes. However, if your builder is a member of a building association, such as a Master Builder they can provide you with some support. A couple of Master Builders I use also provide prospective clients with the The Homeowners Guide to Consumer Protection for useful advice.
Communication
It sounds like a small detail, but I always ask my clients when they sign on with me how they like to communicate, because everyone is different. I have some clients who like to meet in person for all communication, and others who prefer messaging in What’s App. Talk to your builder to make sure your expectations on how and when communication will happen align.
Consult a lawyer - again!
Remember that lawyer you consulted with when buying the site? Before signing a building contract it’s a good idea to also have it checked by your lawyer. For more information search Property Law on the New Zealand Law Society website.
Insurances
It's all good that the builder has insurance, but check it’s enough to cover the job scope. Also check what your own insurance covers, and ask your builder and provider if your own insurance needs to be altered in any way to cover you for the build. Check that the contract includes other people that will be doing work on your property too. While the builder will usually do the bulk they also sub contract out trades like plumbing and electrical to other companies. The builder will often charge a mark-up to manage these trades which should be transparent in the contract. I’ve seen a client upset because they expected to do some of the works themselves but under the builder’s contract weren’t able to – it’s best to have these conversations early!
Protect yourself with a guarantee
It is important to protect yourself and your new build with a building warranty. One of the most comprehensive on the market is the Master Build 10-year Guarantee. It can only be offered by a Master Builder and is the only one in New Zealand to provide cover for loss of deposit, and non-completion. The Master Build Guarantee provides protection for 10 years, whether your builder is still in business or not. A Guarantee must be applied for and accepted; it is not automatic upon appointing a Master Builder. It provides a process for resolving issues if your builder can not or will not complete your project.
Understand costs in the contract
Ask your builder if you can expect any other costs outside of the contract. These could be council fees or building permits and may not all be listed in the contract. Analyse every line of the Contracted Building Works – the allowances are often for standard materials, fittings, fixtures and installations so if you’re expecting otherwise you’ll end up paying variations later down the line. One that has tripped some of my clients up is tiling. The tiling cost quoted is often for standard size porcelain tiles – having thicker natural stone tiles means your floor level may need to be adjusted to remain level, and the install cost will be more. Knowing some of your key interior finishes like flooring and tiling early means your builder can price more accurately. Also think carefully about client supplied items or if there are certain suppliers you want to use as this will change the quoted amounts.
TIP An estimate is an approximate amount that can and often does change, a quote is a specific cost in writing that shouldn’t change.
Contingencies
It’s common for a cost to blow out on a build. If that happens, you don’t want to have to cut corners on quality elsewhere to keep the project going. Make sure the builder has a Construction Contingency in the contract so there’s some fat – a common amount is 10% but I’d rather see that nearer 20-30%!
Deposits and payment schedules
The contract should include what the payment schedule will be. Most builders require a deposit upon signing then regular progress payments throughout the build. Knowing when each payment is due and what it covers helps you prepare and align your finances to suit. Generally, a deposit should be no more than 10% of the build cost.
What’s a variation?
There are so many design options when building it’s almost impossible not to change your mind on something! Changes are called variations and add cost to a project. Having a good idea of what type of products, the builder has priced for (e.g., flooring, tile, cladding, roofing, doors, joinery) before the build starts will help limit variations.
Site visits & inspections
It’s your site and you want to be across progress – as you should! But turning up all the time can be disruptive to all the workers on site. Agree with your builder how and when site visits and progress updates will happen and include this in the contract. It’s also useful to know timings for inspections and different phases of the build so you’re familiar with what’s happening when.
What are tolerance levels in building?
This is an interesting point and one that often affects what I do as a designer. While many builders only work with the same sub trades, I’ve noticed many work with different tradespeople depending on the client’s budget. For example, a builder I met last week has a premium painter, a mid-level painter and a budget painter so he can meet client’s budgets and get a broader range of work. I think this is acceptable if it’s made clear to the client, and if the budget option doesn’t mean substandard. And that’s what tolerance levels are – acceptable levels of workmanship. The Ministry of Business, Innovation and Employment (MBIE) Guide To Tolerances outlines what constitutes acceptable levels of workmanship and sets ‘tolerance’ levels in building. Talk about this with your builder – if you want a high level of workmanship that requires more labour it should be allowed for up front in the contract. Checking out the Guide To Tolerances will also give you an understanding of what constitutes a defect versus a level of tolerance. Make sure the builder’s contract has a clause about how defects will be fixed and have an understanding that these can require sub trades coming back in, so may take time.
Timeframes
The project taking longer than expected and therefore costing you more in labour is one the most common causes of budget blow-out. Discuss the estimated completion date with your builder and get it in writing before signing a contract. It's important that your builder gives you a realistic timeline for your project, but in saying that it’s important you are realistic that there’s a whole host of factors from weather to supply issues out of the builder’s control that often add delays. This is where having a decent contingency is important!
Disputes
The contract is signed; work is about to start and everyone’s excited. But it’s a long journey until completion date and the handover of your home and unfortunately sometimes disagreements happen. While it’s important to check there’s a disputes clause in your contract that covers how these will be handled, the disagreements often happen because other clauses in the contract aren’t accurate or haven’t been fully understood. Talk through the clauses about payment terms, communication of issues, variations, and timeframes with your builder until you fully understand them. Projects always have issues, but the key is identifying, communicating, and resolving them quickly before they become big problems.