Rob Tate, Managing Director What exactly are site costs? Building site costs are often misunderstood and are certainly used by most Project builders to baffle clients and to extract more money for their advertised home. Reputable Builders who care about the industry frown on this practice as it is clearly a tactic used to make the Project Home price seem cheaper. Unfortunately many intending new home buyers and particularly first home buyers, have been badly burnt by this unethical practice We often see scenarios where a builder promises “free inclusions” only to find that the site costs have been loaded up to offset the cost of the so-called freebies. We often have clients come to us having had such an experience. What we can promise you is that we do not load up the site costs to offset so-called special promotions or freebies. We are not saying that site costs are not a genuine cost requirement, especially if the site has over one metre fall. It is more a question of what should be included in the base price and what can be As far as we are concerned, the site-costs are the site-costs and we want them to be as low as possible. However, in fairness to all builders, there is a lot of consumer confusion about what work is included in the site costs and sometimes, clients do have a misguided expectation of what site works and the costs are. Therefore, we believe it is important that you understand that there are two issues to do with the site:-
- Site infrastructure
- Site works
- Site Infrastructure: this covers all the items that are required for the builder to commence and function on site. Items such as, building permit and fees (not planning permits), builder’s construction and warranty insurance, engineer’s site and soil test reports, temporary security fencing, scaffold, portable toilet, Silt run off protection, BASIX requirements, concrete pump hire and crane hire.
All of these items are included in our base price, whereas, many builders will take some or all of these out of their base price and add them into site-work costs. Hence, they make their base price seem lower. In respect of the concrete pump hire for a Builder to charge that as a site cost is almost criminal as there is no way a waffle pod slab can be poured without a pump or crane, the real cost is around $1,700 yet we have had clients charged upwards of $4,500. Likewise with the crane hire, under OH&S requirements a crane must be used to place the roof trusses on the roof, realistic allowance $850 but yet again site cost charges of $2,800 is not uncommon. Another item that most builders are charging for is the insulation requirements to ensure the home complies with the energy saving requirements under BASIX, this is a known expense yet we see the cost of this added on to the bill as a site cost, the same applies for the water saving requirement, a tank of some size along with a suitable pump is always a requirement, but again the cost of this is often charged out as a site cost, remember this all happens after you have deposited and in many cases will add up to $20,000 or more to the advertised price of the home, whereas the real price charged by Rob Tate Family Homes may be as little as $5,000 by comparison.
- Site Costs: The only items that are expected not to be in the base price are the actual site works, which is the second issue of this discussion.
At Rob Tate Family Homes, we endeavour to make a reasonable estimate when quoting by taking levels, examining soil samples and carrying out as many searches that are freely available in an effort to produce a professional quotation. We do this free of charge and only require a $3,000 deposit once our Preliminary site investigation and Tender is accepted. (See our article on our Building procedure) Obviously we will call for a Soil Test, assuming there is no record of a Geotec Study, before we submit our final price, although we have learnt from experience what the classification is likely to be, we have seen sites where ‘land fill’ has been used by the land developer to fill holes or drains and the client has been unaware when the land was purchased. The site was prepared to hide the fill and certainly the depth. The site seemed level and uncomplicated, only to find from the soil tests that significant fill has been used and so the site costs blow out. This situation albeit rare, is obviously a rude shock. What site requirements create site costs? Some or all of the following may be required:
- For Rob Tate Family Homes, land fall above 500mm over the deemed building area. Note that for some builders this may be above 0mm.
- Slab upgrades due to fall, fill and soil conditions
- Root barriers
- Retaining walls, (1m high and above require engineering)
- Agricultural drains
- Additional soil/fill over slab area
- Excess soil removal
- Rock extraction and removal
- Fire attack measures
- Extra runs of services over our standard distance allowances (water, gas, sewer)
- Instalment of services which are not present (water, gas, sewer)
- Heritage overlays
- Land estate covenants
- Local authority (council, water, gas etc.) requirements class (Highly reactive) may only be a few thousand dollars more but P stands for ‘problem’. This could be due to trees which then require root barriers. Cutting and/or filling of the site will also add costs. This incorporates such things as excavation to cut the site, fill to level where required and slab upgrades. Upgrading of the slab, in simple terms, means extra concrete and reinforcement. It may also include such requirements as additional concrete piers. Let me say in closing, any project builder, whether they are the biggest, the best or whatever they claim to be, who will not visit the site with you and provide a preliminary estimate of costs free of charge, should start alarm bells ringing, we have seen time and time again site costs, that we would estimate at around $5,000, being charged out at $20, 000 plus and that is after the client has paid out $3,000 to $5,000.We at Rob Tate Family Homes believe that the entire building experience should be a fantastic adventure and this adventure should be enjoyed by builder and client alike, clearly this adventure can easily turn into a nightmare if you, the client, is being deceived from the beginning. Let us share that adventure with you. Patrick Innes-Director, Construction Manager Byron Allport –Site Supervisor
- Christine Castles-Director, Administration
- Please feel free to contact myself, Pat or Chris with any queries that you may have at any time, we are the people building your home
- As part of our personal service, we offer free site appraisal with absolutely no obligation to you whatsoever on any land that you may be considering purchasing, it is smart to have a qualified builder carry out a pre purchase inspection and know in advance what your site costs are likely to be.
- We don’t plan on explaining the full details of the other components of site works, except to say that the relative severity of each requirement has its own price tag.
- Root barriers are in simple terms, a trench full of concrete and concrete is expensive. Root barrier requirements will be determined by the distance to trees, quantity and size. There can be other reasons for it to be deemed a P site but too varied to discuss here. Suffice to say, a P site will add costs.
- Most builders will have a ‘M’ Class slab included in their base price. However, after receiving the soil test and engineers report, the slab may need to be upgraded to an ‘H’ class slab or a ‘P’ site.