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    House Extensions

What we are doing to combat the state of the construction industry landscape


Alongside a house price boom, Australia is in the midst of a homebuilding boom with the Housing Industry of Australia expecting that a near-record number of new homes will be built over the next 12 months.

But for many in the residential construction sector, it’s a profitless boom – and several major players have recently gone bust, with the assumption that more will follow.

Why are construction companies folding?

A perfect storm of factors has been brewing for the better part of 2021, and now the rainy season has arrived.

Supply chain issues, with a shortage of building materials worldwide resulting from COVID-19 disruptions, coupled with natural disasters from freak storms and flooding to bushfires, have provided significant pressure on builders.

Those shortages have led to prices rising exponentially, particularly for timber and steel.

On top of that, a labour shortage is making it difficult to find tradespeople, giving workers the power to command huge wages.

So, the overall cost of construction has been pushed up significantly.

A number of major builders have gone bust in recent months despite a home construction boom. Picture: Getty Images


Adding to this is the lengthy delays in actually getting the materials, which has led to some homes taking more than 12 months to be built, further adding to building companies’ costs.

With the majority of builders signing fixed-price contracts with buyers, and the margin for escalating costs being inadequate, many are losing money on every single project.

It’s a big problem in exceptional circumstances like we’re seeing at the moment, said Russ Stephens, co-founder of the Association of Professional Builders.

“The average cost of a contract for a builder has gone up between 15% to 20% over the past six or seven months alone – and up to as much as 50% in some areas,” Mr Stephens said.

Australia is in the midst of a residential construction boom, with a near-record number of new homes to be built in the next year. Picture: Getty Images


What we are doing to combat the state of the construction industry landscape

32 Degrees Building has been operating for over 11+ years and we know and understand how to manage our business in turbulent times.

We have been working with our team and talking directly to our suppliers to manage and understand any upcoming supply challenges and supply chain issues. We have been working with our timber suppliers closely to understand their difficulties in obtaining overseas supply and then managing, monitoring and forecasting for our current and future builds. Skills shortage for us isn’t an issue, we have worked very hard to set our business apart from the rest. Our team are employed with us and this enables us to closely manage and develop their practical skills with us over the course of their apprenticeship and retain them into tradespeople and leadership roles – we now employ over 40 team members and continue to grow. By employing our team members, we manage our labour costs.This strategic approach we have applied to our business has allowed us to manage our costs and your build providing you with the security and confidence that we are here to stay.

Our business is always looking forward and planning for the future, we forecast 6 months, 12 months and 18 months ahead to ensure we can stay one step ahead of any market issues and trends.

With the above in mind we have a strong business model and capable management team in place to ensure that the best outcomes for our clients and the business are always achieved.




Should I Stay or Should I Go? Hot tips to help you survive your renovation

Tips for homeowners living through a renovation, extension or addition

Whether you stay or move, your large scale renovation, ground floor extension, or first floor addition can cause stress. Of course, stress is simply par for the course when building, and nearly everyone — regardless of whether they moved out or stayed put – experience some sort of challenge during the build. We’ve put together some tips to help you survive your renovation – whether you stay or go for the duration of the build;

If you decide to stay and live through the renovation, your number one priority is to preserve your sanity:

Before the renovation:

  • Declutter. It will be easier for you to live with the essentials before you start the renovation.
  • Stay far away from the work area to ensure you’re not in the builders’ and tradespeople’s way.
  • Tackle the dust debacle by placing all essentials in one room that you will not renovate, cover them, then seal off the area.
  • Take all your fragile items and store them far from the work area. If you are going to store them in boxes, don’t forget to label them as fragile.
  • Prepare a lot of drop sheets, tarpaulins and blankets. You are going to need a lot of them to cover important furniture pieces and other items.
  • Label every sealed storage box, so you know where to find the items you need. It is a hassle to move things around every time.
  • Ensure you have made all of your decisions and finalised all of your selections BEFORE your build starts. This will take away the stress of feeling rushed to make decisions and ensure clarity when heading into the build. The last thing your builder wants is to work out variations during the build following a last-minute change of mind. Believe it or not, most builders’ would prefer not to have any variations during your build!

During the renovation:

  • Be prepared; it is an emotional journey. Give the builder and their team breathing room to complete the build, communicate with them on their expected finish date and let them work towards it.
  • There will be times when you will feel like everything is slow and one task is taking so much time. When this happens, try to relax – it could be simply due to the number of different trades required to be coordinated for 1 area, or the team is ahead of schedule or waiting on a delivery.
  • If you have been provided with a timeline, generally, your builder should be on track or thereabouts. As long as they are still confident of achieving your end date, it’s not so important how each specific item progresses in between. If you are concerned, discuss the issue with your builder during a scheduled meeting.
  • For large scale extensions and first floor additions
  • Try to avoid unnecessary chats — the type that goes on for hours.
  • If you have zero background in construction, do not be tempted to work alongside the builders and tradespeople. Let them deliver what is agreed in the quote. Also, you do not want to mess up, then pay extra to have it fixed.
  • For better indoor air quality, turn off your air conditioning system.
  • Always wear your shoes and slippers.
  • Keep the kids and your pets away from the construction site at all times. If you have dogs, consider keeping them away for the duration of the build, as doors and gates can be left open, and the builder is not responsible for keeping an eye on them for you.
  • Yes, the portaloo stinks. They are cleaned fortnightly, but it doesn’t take away the youthful nostalgia of festival toilets!
  • Water ingress – it happens. Your builder will do everything in their power to prevent it; however, water can still work its way in during the initial construction stages of a large scale project. Don’t stress though, as your builder will make good the areas that are impacted – just communicate with your builder when this happens.

Based on experience, it is possible to stay in your home and live through a large scale renovation, ground floor extension or first floor addition, but expect changes in your daily routine, and sometimes you may be without water, electricity or internet. You also need to be extra careful to avoid accidents on site.

If staying in is becoming too difficult for you, there is no shame in moving out. Here are our tips:

Tips for homeowners temporarily moving out

  • Make sure that you have the funds for it, discuss with your builder the recommended duration so you can look at accommodation.
  • Look for a decent rental property close to the construction site, school, and workplace, so travelling back and forth won’t be an issue.
  • Conduct regular drivebys to see your home take shape and, if needed, schedule a meeting every few weeks with your builder to discuss progress.
  • Never enter the construction site without notifying the builders for security and safety reasons.
  • If you’re going to live with a friend or a relative, try not to make them feel like you’re conquering their space. Shop for your own food and use your own toiletries.

Deciding to live through a large scale renovation, ground floor extension or first floor addition, or moving out is a personal decision. It is up to you and your family to weigh up the pros and cons, depending on your situation. Assess the amount of work to be done, and the time the builders need to finish construction. Once you know the scope of the project and the specifics of the construction and design, you’ll figure out where you will stay while the work is being done.




What comes first? Plans or Quote?

We often get asked: “What should I do first? Should I get a quote for my home extension/addition or should I get plans drawn up?”

These are our top 5 tips on why you should get a quote from a builder BEFORE getting plans for your project when building an addition or extension.

    1. Obtaining a detailed written quote or proposal for your addition or extension comes with many benefits. In your quote the builder should provide you with an indication of the size of the build (how much room is going to be added to your home), the number of rooms being added and what materials and inclusions are being used so you know what is included and if you can afford what you are planning to build.

 

    1. A builder can arrange to assist you in drafting plans inhouse or have relationships with draftspeople or architects that specialise in the type of build you are after. This can make the whole process smoother and faster saving you time and money.

 

    1. When you work with your builder they can review your plans with you and the draftsperson to ensure you are staying on track with costs and may pick up on items that may be of concern from a construction viewpoint. This input is important in ensuring that you achieve what you set out for in your build while staying within your budget and avoiding issues that could arise during the build if not picked up during this critical planning stage.

 

    1. A builder can help and advise you on the true costs for different material options before you commit to plans and approvals. This can in turn ensure that you get the right materials, resulting in the right look for your build at the right cost.

 

  1. A builder can consult and guide you with on how to achieve what you want while managing what you can afford. This is best done prior to plans being drawn up due to the builders expertise in the type of build you are looking at. This can reduce the amount of plan revisions and save you time and money in the short term and long term.

If you are thinking of planning or building an addition or extension contact us on (02) 4647 2324 or fill out the form below to get things started.

 

Get a $25,000 contribution towards your Addition, Extension or Renovation through the HomeBuilder Program

Eligible Australians will be able to obtain a $25,000 HomeBuilder grant towards their addition, extension or major renovation under the near – $700 million federal government housing package in a bid to boost the economy and act as a lifeline to the home construction industry (Homebuilder program).

The government announced the $688 million HomeBuilder program on Thursday 4 June 2020. In an attempt to boost new projects between now and the end of the year, the Government will give $25,000 grants to owner-occupiers for certain works on their homes.

These works include first floor/second storey additions, ground floor extensions and large scale renovations.

Renovation work does not include structures separate to the main property, such as swimming pools, tennis courts, granny flats and sheds.

The scheme will not apply to investment properties or owners who intend on building or renovating on their own without the help of licensed builders.

The plan will be restricted to people on middle incomes and to new homes and major renovations valued between $150,000 to $750,000.

The pre-renovation value of the house must not exceed $1.5 million and excludes sheds, pools, granny flats and any other structures not attached to the property.

The temporary scheme that will last until the end of the year, aiming to build 30,000 homes by Christmas.

Construction of a new home or a substantial renovation (including first floor additions, second storey additions and ground floor extensions) must be contracted to begin within three months to prevent a rise in house prices.

The grants will be means-tested, allowing singles who earned up to $125,000 the previous financial year and couples who earned up to $200,000 to access the scheme.

The scheme will work along existing state and territory first-home owner grants programs, stamp duty concessions and other grant schemes, including the federal government’s first-home loan deposit scheme and first-home super saver scheme.

To take advantage of the HomeBuilder Program and secure your $25,000 grant, it is important that you start the planning process now.

Contact us now to discuss your first-floor addition, ground floor extension or large scale renovation project.

 

How to compare building quotes

You’ve made a decision to invest in expanding your family home, but there are so many building companies out there, who do you contact and how do you select a builder and feel confident that you are making the right choice? What type of builder should you be looking for? And how can you avoid facing the common pitfalls and horror stories?

It can be a daunting process, and if you’re in the process of obtaining quotations for a potential second storey addition or ground floor extension on your home, you may be wondering why the quotes you do receive are coming back varying in price.

To help, we’ve compiled a list of items to consider when comparing the value of the quotations you are receiving.

What impacts a build cost? Put simply the following items below will all impact your quotation;

  • Builders experience
  • Building timeframes
  • Allowances & inclusions
  • Ambiguous quoting
  • Items missed or not outlined clearly
  • Service delivery and project management

So, how are all of the quotes so different in price?

It is quite normal to receive quotations and see a 5%-10% difference between them, any more than this would raise a red flag, and it is suggested that you approach your builder and ask the following questions to help determine where the cost differences may lie.

Is the quote apples for apples? Is it comparable?

It’s important to understand that allowance items and finishes are different between builders; for example, you may have an allowance for a $10K bathroom package vs a $3K bathroom package in your quotation. Immediately this will impact the build cost and also may be a deciding factor in the quality of the build you will receive.

How does the builder operate? Do they use employees or contractors?

If the builder is a smaller company, they may use contractors or have less employees, if this is the case, what are the timeframes for your build? The duration of the build may take longer, and you then have to weigh up the additional cost to you of a more prolonged disruption to your family and if you may incur potential additional rental or storage costs over this time. If they are a smaller builder, they may only complete 1-5 projects a year vs a medium-sized builder who completes 20-30.

This would then raise follow on questions of how long do they take to complete a build? How big is their team? And how will the project be managed? Will you be able to talk with the Project Manager during the build, will you have a site supervisor, how can you reach management if there is an issue, is there a support team in place to help guide you through the process?

If they use contractors or employees – how is the quality managed and how can they guarantee the timeframes?

By having employees, they are paid to turn up on time, every day as projected; this ensures no downtime and your project can run smoothly. Unfortunately, some contractors work to their own schedules which don’t always work in with the build and can result in delays. If they use contractors, can your builder guarantee the duration of your build and also the quality? What happens when something goes wrong with the quality, can they get the contractor back to resolve it or will there be project delays while they source someone else to resolve it? Where do you stand if there are delays in your build?

What type of contracts do you work with?

What type of contract used is important to understand very early on in the quoting process as this can have significant impacts to the cost of your build. We recommend only choosing a builder who is using fixed price building contracts such as the Housing Industry Association (HIA) and Master Builders Association (MBA) contracts.

These contracts have been made easy to understand and contain space for the parties to fill out information such as the price, contract completion date, any excluded work.

What is a Fixed-Price Contract?

Fixed-price contracts are contracts where the price agreed upon is a fixed lump sum. This is the most common type of contract used for residential building works.

There are several ways in which the contract price can be changed. This includes ‘variations’, i.e. changes or additions to the scope of works. It also includes provisional sum items (allowances) which may not have been decided at the time the contract is entered into, such as bathroom/kitchen allowances. If the amount allowed is more than the cost of the item, then the owner will receive a credit. If the amount allowed is less than the cost, then a variation will be created.

Cost Plus Contract

An alternative to the fixed-price contract is a ‘cost plus’ contract. These contracts have a capacity to become very expensive, and you should carefully consider these contracts before entering into them as there is no upper limit for the final price.

These contracts differ from the fixed-price contracts as, rather than agreeing to a fixed-price for the building works, the owner agrees to cover the builder’s costs plus an agreed margin for any overheads and profit encountered by the builder. In other words, the price is the actual cost of the works plus the builder’s margin.

How we can help you with your addition, extension or renovation

Your home is one of the most significant investment decisions you will make in your lifetime, and it is an emotional purchase and, as exciting as it can be, it can also be quite stressful at the same time. You need to be able to put trust into who you are engaging with to ensure a positive outcome and stressfree seamless process and this means that it is not always about taking the cheapest quote. You should feel comfortable with being able to approach your builder and talk over your quotation to understand what is included and how you will fit in and work together on your home.

At 32 Degrees Building, we have a team to guide you through the process to help you understand your quote, the process and work together with you on your build. This includes having your own access to your own project management team during your build for peace of mind and quick response.

If you would like to discuss your upcoming second storey addition or ground floor extension with our team and receive a detailed build cost estimate, please reach out to us.

 

Live the life of Luxury with a Resort Styled Retreat

The Perfect Parents or Teenagers Retreat from $205K

Looking for a dedicated area for you to escape the daily grind and kick back and relax? Our Resort Style Retreat Package is tailored to providing the extra space and lifestyle you are looking for.

Retreat Package from $205K

40m2 Second Storey Addition
1 open plan bedroom with integrated living area
1 large ensuite

This exclusive package is available for a limited time only. Take advantage of low-interest rates, increase the value of your home and get that extra room for your family.

Terms and Conditions:

Build cost only, based on a 40m2 addition. Plans and Council approval excluded – these are estimated at $15K.
A full quotation can be only be provided following an onsite consultation with the builder to undertake an assessment and determine suitability.