Building inclusions checklist: 5 things to know when building a home

Are you thinking about building a home? It can be an exciting time, with a brand new home to look forward to moving into. But it’s generally not a good process to rush, as preparation and preparedness can help you achieve a better outcome when building a new home.

Building a home is a different process from buying existing real estate. You still need to undertake appropriate due diligence, but the checklist is different.

In this article, we’ll share five things to know when building a home.

Tip 1 – Know your budget

Understanding your budget is a crucial step. Building a home costs money, and this is usually a pretty large amount.

The amount will vary depending on factors such as the size of the home, the cost of the land (if not previously purchased), the quality of materials used in construction, the number of inclusions you opt for, and a myriad of other factors.

Before embarking on the next steps, you should determine your budget. If you are fortunate enough to have some money in the bank to pay for the build outright, you’ll know how much you have and, therefore, your limit.

However, for most folks, you’ll need to borrow money for the build. And lenders will often want to see a decent deposit, usually around 20% of the property’s projected value. It is a good idea to speak to your lender to understand how much you may be able to borrow to help determine what your total budget could be.

By the time you’re ready to apply for finance, you should have an idea of the estimated total cost of your build by working with your architect, shortlist of builders and other professionals.

It is also important to note that a construction loan operates a little differently to a home loan. A construction loan is typically drawn in stages and progresses with the build.

Tip 2 – Choose your builder

There are a few different ways you may discover the right builder for your home build. We are sharing some common ones, and also some lesser known tricks.

1. Get Googling

Google can be a powerful tool in your search. You can search for ‘builders’ and then include your city, or even narrow it down to the suburb you want to build in.

Not only can you see a list of builders, but you will also be able to view reviews.

2. Reach out to your networks

It can help to make a few calls to friends and family and ask around at work. Chances are that people you know have worked with a builder for an extension or a new build and can make recommendations.

3. Look around your area

Take a stroll or drive around your local area and look for homes under construction. If you like the look of them going up, you can take note of the builder’s signage and get in touch with them to discuss your build.

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Tip 3 – Obtain estimates

Once you have a shortlist of possible builders, the next step is to obtain estimates and quotes for your build. The builders will take a look at your designs (if you already have them), or work with you to understand what you are looking for, and get back to you with an estimated cost.

Remember that cost estimates are just that –estimates – and that the actual cost can fluctuate due to various factors. This is why it may be a good idea to have some cash as a buffer. You can also ask the builder for more information about what is included in the price, and areas where the price may increase or vary.

Tip 4 – Building inclusions checklist

Once you have chosen a builder, the next step is to obtain the contract. This is a legally binding document between you and the builder of your new home.

It’s worth noting that most lenders may want a fixed price contract before they approve finance, so speak with your lender to understand what they require and check with your builder.

It can also be a good idea to have your contract reviewed by a legal professional, as they can help you understand it better and suggest amendments.

The next step is to consider inclusions in the contract. This means elements of the build that are included in the price of the build.

Some features you may want to look out for include:

• Insulation. Check the rating, and consider if it will be sufficient for the size of the house relative to your energy rating report. Properly insulated houses can give you substantial savings on heating and cooling, so don’t neglect this.
• Energy efficiency. Are the heating and cooling systems energy-efficient good brands, and are they suitable for the size of your home? Some included systems may not suffice for the home’s size, while others may exceed your requirements. The best way to check this is by cross-referencing what is being recommended by the manufacturer for your specific model.

You may also like to think carefully about inclusions, such as:

• Garage doors. Costs can vary wildly, as can quality, with garage doors. Consider what is included as standard, and if you are happy with it.
• Appliances. With appliances, it’s worth researching the brands that will be included as standard, and checking if they will be appropriate for your needs. Consider the rangehood and dishwasher, for example.

You can negotiate with the builder to make sure you receive the products, features and end results you want.

Tip 5 – Final checks

Once your build is complete, you should conduct a final check before making the final payment to the builder and obtaining your keys.

According to Consumer Affairs Victoria, a building project is considered complete when all works defined in the plans and your contract are completed to an agreed standard, and any significant defects are rectified. Also, when your surveyor issues a Certificate of Final Inspection or Occupancy Permit, the project is considered complete. While the terminology and definitions may vary slightly across states and territories, similar standards apply.

You may want to consider engaging an independent property inspector to inspect your new home before accepting the build as satisfactory.

If your building inspection reveals incomplete or faulty works, you can, as some initial steps:

• make a list of incomplete elements, faults or defects
• speak with your builder about your concerns
• send the builder a written request to complete the works, or rectify the defects, to an agreed standard.

Further action might be required, depending on how the discussions go with your builder.

A bonus tip – Utilities

Once you have approved the final build and completed the payment via your funds or a loan, it is time to connect all your utilities. These may include:

• gas
• electricity
• internet
• telephone
• water

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