What to look for in a building quote

Now you have shortlisted your preferred builders and received quotes from your top three, let’s spend a moment on what to look for in a building quote. Note: this is not about carrying out due diligence or specific contractual arrangements (that’s to come), but about what you should expect to see on a good-quality quotation.

Coupled with a site visit, your fully specified working drawings will be sufficient information for the prospective builders to provide a quotation for works.

Some architects prefer to take job detailing one step further by producing a tender document, tabulating job specifics and providing a set template for builders to price up within, but this is perhaps overkill for more straightforward extension-type projects.

what to look for in a building quote - calculating costs

What to look for in a building quote

Every winning quotation should contain certain key information. Every quote should fulfil the following points.

Be binding

The price provided must be a quotation, not an estimate. An estimate (or ballpark) is an approximation of what the job could cost, whereas a quotation is a fixed figure of what the job will cost.

Be referenced with supporting documentation

This is where you reap the benefits of the hard work and effort put into producing a set of drawings that are planning-approved, structurally sound, compliant and fully specified.

The quotation should reference the planning-level drawings, structural calculations and plan, building regulation drawings and working drawings. In doing so, the plans essentially become the deliverable.

Other supporting documents may include externally supplied items such as kitchens, bathrooms, cupboards, etc, if the builder is responsible for fitting them.

Be specific in what’s needed

In addition to delivering the approved plans to the specifications provided, the quotation should also be clear about what else is in scope. Typically, additional inclusions will be drawn from one of three categories:

  1. Preliminary items
    These are things that need to happen or to be in place beforehand, to facilitate works. Examples include the provision of skips, welfare facilities, scaffolding, health and safety and hoarding.
  2. Ancillary works
    These are supporting activities required to enable planned works to proceed smoothly. To give you a flavour, ancillary works may include demolition, waste removal, upgrades to common parts of flats, and heating system adjustments.
  3. Additional works
    These are items you may wish for in addition to the extension and which are not specified on your drawings, like garden landscaping, decorating, fitting blinds, and so on.

Be specific in what’s excluded

On the flip-side, the quote should be explicit on what is excluded.

It is good practice to ask for any exclusions to be priced separately at this stage, because if you later decide to go ahead with any of them, you will at least have agreed the price from the outset, when the builder is incentivised to price competitively to win the work.

It’s useful to have a day rate from the builder for ‘bitty’ ad hoc work that may not lend itself to a fixed price.

In addition to the exclusions, it’s useful to have a list of client purchases summarised on the quote, to make it easier for you to budget for. Client purchases include items like kitchens, bathrooms and finished flooring, to name only a few.

List any assumptions

If the builder has made any working assumptions that inform the quote, they should be listed.

Assumptions would be made in circumstances where the supplied plans and/or site visit leave a blind spot in the builder’s knowledge of the project ahead. Assumptions typically coalesce around things that could not physically eyeballed by the architect, engineer or builder, such as which direction the joists run or the state of electrical–mechanical services within walls.

During times of supply chain volatility, where material prices jump around daily, it would not be unreasonable to see assumptions made on the cost of building materials.

By listing assumptions in the quote, both you and the builder have an explanatory baseline for any unforeseen works that may come to pass once the project is underway.

Give a clear price

The project price should appear full, clear, fixed and unambiguous.

The quote should be priced to deliver the specified project and not priced on the builders’ day rate (the latter lending itself open to abuse by the unscrupulous).

The price should state if VAT is non-applicable, included or excluded.

Much debate is given to whether the price should be itemised, broken down by activity or split between labour and material. This should really be left to the builder to present according to their own system. Ultimately, what matters most is how much it costs to deliver a specified plan.

Give service-level terms

These will be bound up in the works contract between you and your selected builder anyway, but it is still reasonable to expect the quotation to give reference to important service-level information such as the contract type (more on this later), job duration, working hours, snagging procedure, guarantees, insurance payment schedule and any retention payments.

Armed with the knowledge of what to look for in a building quote, you are now ready to cross-examine your preferred builder, by carrying out your due diligence, before making the hire.