5. Setting a Budget

• The land purchase
• The building cost
• Professional fees
• Services
• 10% contingency fund

The sum of the above minus the land purchase is your building budget

• (NB: Costs are estimates only)
• Your first quick take on how much your house will cost to build can be done using a general approximate rate per square metre. These rates are used across the construction industry and only vary as costs escalate over time. Current rates are as follows (based on a 4 bed house of 200m2 of brick/cavity/block construction):
• Standard build rate/middle-of-the-road quality: £1300 m2
• High quality build rate: £1400 m2
• Green / Eco materials: + 5 – 10% more
• Green / Eco materials & equipment to Passivhaus energy standard: + around 15-20% more

Costs are exclusive of VAT professional fees and contingencies

NB Costs can vary widely depending on:

• Level of design detail – buildings costed at planning stage: around + 5% more
• Location in the UK
• The foundations required for the ground conditions (eg slope or poor ground)
• Structural system used eg brick/block, clay block, SIPs etc.
• Availability of services
• Site clearance (including existing buildings).

• Preparation is about reducing risk. The less apparent risk the cheaper it will be
• (recommended) appoint an architect and quantity surveyor
• The architect will design your house with enough information to work out its cost accurately.
• The quantity surveyor will be able to work out the costs of the building from the architects details.

An alternative to a QS is to use a costings service such as:

• Ecomerchant’s Price the Plan www.ecomerchant.co.uk/content/self-build which provides and estimating service for a very reasonable fee.

• If you’re going down the main contractor route, of course the cost that matters is the one the building contractor provides.
• If you’re going ‘out to tender’ (recommended), equipped with detailed drawings and specification your Architect will help select at least three builders best suited for inviting to tender.
• A tender is the way of getting the keenest price for your building work. Building contractors will compete with each other to get the job.

• Unknowns (risks) are priced at a premium by everyone involved in the project.
• Eliminating or minimising risks saves you money.
• Make sure that you plan thoroughly before putting out the drawings and specification for tender. Check everything twice and don’t ever think ‘that you can sort it out later’ – not unless you have deep pockets

Most building projects tend to vary a little. For all sorts of reasons that are unpredictable, costs can escalate. Instead of finding yourself without money to complete the project, it is wise to set aside a contingency fund. 10% of the agreed contract price is the usual sum set aside as a contingency. Once it’s done, guard it with your life because everyone will want a bit of it!

Make sure that you insure the building works from start to finish. There are plenty of things that can go wrong, so don’t compromise your budget and your building, get insurance. Plenty of insurers can provide a quote.

Architect, QS, Structural Engineer, Services Engineer

• Changing the plans during the works or after agreeing a price with the contractor can add substantially to the overall cost.
• Make sure you have worked everything out before agreeing a price with the building contractor