When building a new home, an exciting step in the journey is to complete the pre-start/pre-construction process. If you haven’t been through it previously, it’s akin to your first time in a pastry or candy store when you were a kid!
Up until this point in the journey, you would have only seen your home through 2-D renderings or 3-D model representations, but during pre-start, you can get a sense and feel of the materials that will make up your dream home. However, there are certainly pitfalls to avoid when going through this process, lest you return to your bank manager and request an increased mortgage!
Pre-start/pre-construction for the uninitiated is a pivotal aspect of the building process, where you can pick and choose the key materials and finishings that will go into your home. If you purchase your home from an established builder, they will have a host of different finishes and materials for your selection. As part of this process, you can also decide which materials you choose to source externally versus the ones you would prefer to have managed by your builder.
During my time in real estate, I noticed a few patterns where buyers were left dissatisfied or frustrated by the unanticipated costs that were being built up during the pre-start/pre-construction process. In my mind, the majority of these costs could have been avoided, if these buyers completed the following:
At the outset, a common misconception when commencing the pre-start/pre-construction process is that the costs associated with modifications to the plan will be built into the contract price. In some instances, this may be true. For example, certain benchtops may come in a range of colours that you could choose from at no extra cost. However, in most instances, changes you request will likely result in additional costs and delays to when your house can commence construction.
At the time of signing the contract, the floor plan that you agreed to would have already gone through review and approval by the building company’s structural engineers, responsible for earth works and foundational works. If you were to request changes, such as the number of electrical points you would like in the home, that would result in the plan being re-sent to these structural engineers for additional review and approval. At a minimum, you will be stuck with a change fee with no guarantee that the change can be addressed.
The costs associated with these changes are completely unnecessary and avoidable, as you have a clear opportunity to request these changes prior to pre-start. The established builders will likely have a pre-start regulation guide/manual that they have internally developed and regularly update.
During the contract negotiation phase, request access to a template version of this manual to better understand what is being offered and what can be achieved within the home sales price. Even if your changes push the home sales price higher, that differential will be much less than if you were to request the change during pre-start, given the company’s margin on pre-start changes are a few multiples higher than changes requested prior to signing the contract.
During the contract phase, the sales consultant’s underlying motivation is to convert you into a sale, therefore they will be more than willing to convince you that your changes can be deferred until pre-start. However as a savvy buyer, your measurement of success should be to have your pre-contract home design and specifications align as closely to your actual home build.
If you were to buy a car, you would typically research various car options and configurations, refine your list of preferred options and customisations, and make an informed decision on which car to purchase. All of this is done before putting pen to paper. While a home build is a slightly different purchase decision, it does not mean that you can’t do your homework prior to signing the contract.
Unless you are a gifted or experienced interior designer, it is oftentimes difficult to conceptualise how certain colours, textures and patterns will appear in a finished home. I encountered a number of clients during the pre-start phase that loved certain materials or finishings in the display room, but hated them when they were installed into their homes.
There are so many different decisions and selections to make, that it can certainly create an environment where errors will be made. This is where requesting tangible examples will come in handy. Most builders will also have multiple display homes where they will not only showcase their floor plans, but also their materials and finishings.
If you have a certain selection of materials in mind, but are not sure how they would appear in the context of a certain room in the house, check with your sales consultant if they have included these materials in any of their display homes. In the absence of something tangible, request a virtual demo rendering of how those materials would appear in your floor design. This can and should be requested prior to commencing pre-start, so that you don’t get forced into making certain decisions and then paying for them when you change your mind.
When I was a first home buyer, I was extremely cost conscious – anything to try and save money and avoid hidden costs. So when my family and I began our pre-start/pre-construction process, we always began looking at material wholesalers and fixture retail companies for the same or similar products. We drew inspiration from the designs and aesthetics of the pre-start materials, while gaining savings from the materials we purchased from the third party vendors.
As a sales consultant, I never dissuaded my clients from shopping around for certain materials and fixtures. If cost wasn’t an issue, the process of looking elsewhere at least serves to broaden your perspective of what can and should be included in your home.
A drawback of the pre-start process, particularly with established builders, is that the materials and fixtures on offer are representative of that builder’s brand and outward perception. I don’t mean this in an overtly critical way – most of these materials are timeless and hold their own in any home. However, as they are somewhat homogenous and catered to mass appeal, they may not necessarily suit your personality or preferences.
In the absence of proper planning, it is no wonder that most clients feel some degree of pressure during the pre-start process, and may have regretted some of their choices. That’s why, at the outset of this post, I recommended front-loading the decision making process.
However, if you go through the painstaking effort of researching, refining and selecting your materials/fixtures prior to pre-start, follow through on your decision during pre-start. To refer back to the candy store analogy, you feel very comfortable with your choice of a chocolate eclair, until you see that red velvet cupcake out of the corner of your eye. Resist the temptation to change and trust in the work that you put in to make your initial decision.
Also remember that your final home will not look like a finished display home in all instances. Those display homes are constructed with the intention of presenting the builder’s finest materials, fixtures and appliances, which oftentimes are it’s most expensive. Use the display home to find what you like, but more importantly, what you can make work within your budget.
In my experience, the clients that were prepared prior to pre-start and still went through buyers remorse, were those that placed too high a value on aesthetic over functionality. In the end, the material or fixture serves its intended purpose, but is questioned by the owner because it didn’t have the look or feel of another material or fixture noticed late in the pre-start process.
I can fully appreciate this viewpoint, as it is your home in the end and you want it to be perfect. However, in my eyes, having a perfect product is overrated, and is certainly not worth the additional costs and time delays you would have to go through in making the change. Provided that material or fixture functions correctly and I actively chose it based on my research, it is good enough for me to live with it in my home.
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The pre-start/pre-construction process is an exciting time in your home building journey. However, to avoid unnecessary cost build-up, I would simply balance that excitement with some caution. Don’t feel pressured into deferring key selection decisions until after the contract is signed. Instead, take the time to research what’s on offer and be comfortable with your expectations for how your home should look. That way, you can spend more time having fun during pre-start!
Thank you for reading this post. If you would like, please feel free to leave a comment below about your pre-start/pre-construction experiences, or if you have any specific questions regarding the pre-start process.
The content outlined above was written, edited and published by the Lost Realtor. The author has over 20 years or real estate sales and investing experience in the Australian property market. He has held senior positions in Australian building companies, including being the General Manager of the residential sales division of Collier Homes. His qualifications include a Bachelor of Commerce degree and a Graduate Diploma in Building and Construction Law.