PrintWant to know what’s involved when planning a project home build? Learn about the constraints of your land, how to choose the right builder, and the financial commitment involved.
1. Understand your costs
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Be aware of extra costs that you may need to pay. Learn about the cost considerations for your Plan phase.
Some costs are mandatory and are part of the planning and council application. Other costs will be dependent on your type of contract, your project home inclusions, and your council area.
* Indicates a mandatory step and cost
Some costs are mandatory and are part of the planning and council application. Other costs will be dependent on your type of contract, your project home inclusions, and your council area.
* Indicates a mandatory step and cost
Planning costs
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Information
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*Project home package – initial deposit
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Expect to pay a deposit once you sign your project home contract. This will be a maximum of 10% of the total cost. Speak to your bank or lender to find out your required deposit. |
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*Site survey
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A land surveyor will need to prepare a detailed survey that sets out the features of your land and adjacent blocks. Council will require this as part of the development application or complying development certificate. Check with your builder if this is included in your package. If not, you will need to hire an independent surveyor to create the survey. |
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Preliminary builder fees
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Most builders will charge a set of fees for the inspection, planning, design and preparation of your project home. Fees will depend on your builder, your land and chosen property. Check the cost and inclusions of these fees with your builder. |
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Geotechnical report
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Depending on your land and location, your builder may request a detailed analysis of subsurface conditions. This helps to understand earth materials like rock, sand or clay which will impact how a house is constructed. Check with your builder if this is included in your package. If not, you will need to hire an independent specialist to create the report. |
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Design, fixtures, and furnishings
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Your project home package will have certain inclusions as part of the base price. Be aware that if you want to add or change any designs, fixtures and furnishings, you may need to account for additional costs. Speak to your builder to understand your inclusions and exclusions. |
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Legal fees
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If you wish to seek any legal advice regarding your home building contract before you sign it, check with your solicitor or legal advisor for their costs. |
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Additional reports or assessments
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Additional reports may be required by your builder or your council throughout the building approval process. It’s important to check with your builder if any costs for additional reports are covered by your home building contract. |
| Section 10.7 Planning Certificate |
Shows the zoning of the property, its relevant state, regional and local planning controls and other property constraints such as land contamination, level of flooding and bushfire prone land. Apply online via the NSW Planning Portal. |
| Planning consultant fees | You will need to pay these if you choose to get independent planning advice and feasibility reports. |
| Financial advisor fees | You will need to pay these if you choose to get advice on your finances and borrowing capacity. |
2. Secure finance
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Most people choose to finance project homes with a construction loan. These loans give you access to your money at intervals so you can make progress payments as the builder completes each stage of the build.
Typically, you’ll make a progress payment at different stages of the build, depending on your financing arrangements and the building work contract.
- laying the foundation slab
- exterior framing completed
- brickwork completed
- lock up stage
- fit out stage
- practical completion stage
You may be able to borrow up to 95% of the value of the land and construction costs if you use a licensed builder. A financial adviser can help you work out what sort of property suits your current plans, understand your borrowing capacity, and organise the right loans.
It’s a good idea to get your loan pre-approved several months in advance so you have time to research and select your builder and obtain unconditional approval for your loan.
Make sure you consider all the key building costs, including rent if you need to live somewhere else during construction.
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3. Understand your land
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Once you have an idea of how much you can spend, you will need to understand the limitations of your chosen block and any laws for building on it, such as:
- tree preservation orders, or trees that need removing
- minimum green space requirements
- underground utilities and infrastructure provisions, such as sewerage, electricity, gas and water
- any excavation required on the land
- any drainage and stormwater issues from the property.
Soil type will determine the footings or slab requirements for your design. Make sure the soil on your chosen block will support your new home before you commit to buying the land.
Refer to the relevant planning controls in your myHome Planner property summary before starting any work. You may choose to seek professional advice on how the planning controls and laws apply to your property. You may also choose to engage with an architect to advise on design considerations for your block of land, location and environment.
To learn more about the development potential of your chosen block, you can apply for a Section 10.7 Planning Certificate from the NSW Planning Portal or your local council. The certificate will show planning controls and other property constraints such as land contamination, level of flooding and bushfire prone land.
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4. Learn about sustainability targets
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All new builds in NSW must comply with the Building Sustainability Index (BASIX) to help reach state-wide sustainability targets.
BASIX is a sustainable planning measure with requirements for water, energy usage and thermal comfort performance.
These requirements must be included in your project home plans. You or your builder will need to complete an online assessment to work out if your proposed property meets sustainability requirements.
For more information and advice on sustainable home design, visit the independent guide on the Your Home website.
You can find out more about applying and paying for your BASIX certificate in the Approve phase.
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5. Maximise your land
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Once you understand the zoning and environmental regulations, it’s time to start thinking about how your location and surrounding environment will impact your project home.
Consider your block’s unique features and the design choices that will create the most suitable home for your block.
You may want to consider:
- the slope of your block
- the proposed orientation of your house on the block
- the climate of your location
- the way the sun faces your proposed home
- the placement of windows and electricity installations on your proposed home in relation to your property boundary (which can have additional obligations) and your neighbours
- sewer access
- if your land is bushfire prone
- if your land is at risk from flooding
- if you’ll have direct property access during the build or will need access from a neighbouring property.
You may identify some design features you would like to add into your project home, though you should be aware most home builders will provide a package home design with set inclusions.
To understand your options, visit display home villages to see home designs from different builders or talk to friends and family that have been through the process.
It’s important to understand what is included in your package up front as certain finishes, furnishings and extra inclusions may be an additional cost.
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6. Research and select builder
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Choosing your builder is a critical step. Ideally, they will specialise in project homes and work with you to find the right home design to suit your needs. Look for experienced builders with examples of previous and current projects or visit display home villages and design centres.
Your builder can coordinate the building works as project manager.
This role includes:
- supervising and coordinating each trade representative
- sourcing and coordinating delivery of materials
- quality assuring the entire process.
Create a shortlist
Create a shortlist
Consider creating a set of criteria that will help you focus your research to find the right builder. You may want to search for builders in particular locations, check whether they offer designs that match your home vision, and if they offer packages that fit your budget.
You can also:
- research companies through ASIC and ABN searches
- check whether they have an iCIRT rating
- check the NSW Fair Trading complaints register
Check licences
Check licences
Once you have a shortlist of builders, you should always check if they have a valid contractor licence at Service NSW. If you cannot find it, contact Fair Trading to confirm that the company holds a contractor licence.
By law, all contractors must show their licence number on all advertising, stationery and signage. Make sure you complete this step before you engage the company to avoid contracting unqualified builders. If you hire an unqualified builder, you may face limitations when trying to resolve any defects or incomplete work
Check home building compensation cover
Check home building compensation cover
All builders require home building compensation cover for work over $20,000 including GST. This cover helps homeowners if the builder is unable to complete work or fix defects because of insolvency, death, disappearance or licence suspension. If the public register shows the builder is limited to contracts under $20,000, they are not eligible to do the work.
Check examples of work
Check examples of work
Before deciding on your builder, view examples of their past and current work. You can organise a tour of current exhibition homes at display villages or visit previous build sites and suburbs to get a better sense of the build quality.
You can also ask to speak to previous customers about their experience with the builder or read online reviews to understand their reputation.
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7. Builder provides quote
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When building a project home, it’s important to understand that the base price and final completion price can vary. The base price is usually a flat rate that includes a list of standard features determined by the builder. They will quote this price once they have completed a preliminary assessment.
Be aware that a final price will not be settled until a contract is signed. This price may increase due to any:
- changes to your chosen design
- changes to the size and complexity of build
- non-standard finishes and furnishings
- extra inclusions
- material costs
- tradespeople and labour costs.
Be careful to look at what is included and excluded in the package and use this to compare quotes between builders. If your contract is not a fixed price, the cost of labour and materials can increase throughout the project. You will need to allow a buffer for this in your budget.
Remember that there will be additional fees on top of the base project home price, such as planning approval application fees.
You may also decide to work with a draftsperson or architect to create your own plans.
Some builders offer a ‘turnkey’ option. This is when all additions are included in the build that you may otherwise have to organise yourself, such as landscaping, fencing and driveways.
You may be asked to pay a small deposit at the preliminary quote stage for exploration works such as site assessments and soil testing.
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8. Seek independent advice on build plan
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You may wish to ask an independent planning consultant to assess the design against the relevant planning controls on your chosen block. These regulations include:
- ensuring the home meets minimum sustainable design requirements
- protecting the amenity of neighbours
- preserving neighbourhood character.
If you are buying into an estate, you may need to follow additional estate design guidelines.
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9. Pay preliminary assessment fee
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Once you’ve completed the research phase and have chosen a builder, they may ask you to enter into a preliminary agreement. This is also known as a preliminary quote, preliminary contract or pre-services agreement. It is not an agreement that involves residential building work.
This agreement will allow the builder to coordinate initial assessments of your site prior to designing plans or submitting applications.
Given the time and effort involved in these assessments, there’s usually a preliminary assessment fee charged for the agreement.
Fees will depend on your builder, your land and chosen property. Check the cost and inclusions of these fees with your builder.
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10. Choose your floorplan
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It’s time to think about your floorplan. A good floorplan will manage the flow of traffic in the house, use the home’s aspect to its advantage and contain noise to certain areas.
Consider an energy-efficient passive design. This type of design works with the local climate and site, so your home needs less power to stay cool in summer and warm in winter. By making the most of natural light, ventilation and position of the sun, you can save a significant amount of money on your energy bills.
It’s also important to think of accessibility and safety, especially in terms of multi-generational homes with young children and ageing adults.
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11. Builder coordinates site assessments
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Your builder will conduct site assessments and request reports from specialists, so they have all the information they need to assess your land for construction.
Check with your builder if the costs and coordination of the site assessments are covered in your preliminary agreement.
Your builder may engage industry specialists for you, or you may choose to hire independent specialists.
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12. Builder draws up detailed plans
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The builder will create detailed drawing plans for your house once they receive the reports back from any specialists they have consulted.
Your chosen house design may be altered to suit your block, or any additional variations you have requested may be added to the plans at this time.
13. Builder provides cost estimate via tender
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The builder will provide you with a more detailed cost estimate of your build, often called a tender.
A tender considers your build site, particularly the soil conditions and slope of your block, BASIX requirements and zoning (flood and fire risk, and development guidelines).
It should break down all the costs for you, and whether those costs are fixed (the amount will stay the same) or variable (the amount quoted is subject to change).
Be mindful that there are often additional costs involved in build projects, including planning approval application fees, variations to designs, delays and materials.
14. Choose preferred tender
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If you have tenders from multiple builders, you will need to choose your preferred tender.
You may choose to:
- accept the price and proceed to the construction phase of your build
- choose a preferred tender to negotiate with on price, or
- reject the price and retender.
15. Agree on fittings, fixtures and colours
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As part of your specifications to your builder, you now need to select fixtures, fittings and colours.
- Fittings are freestanding items in your home, including furniture, certain appliances and décor.
- Fixtures are permanently attached to your home, including ceiling fans, electrical power points, toilets and sinks.
Some fixtures are more sustainable and environmentally friendly than others, so you need to consider which ones will help you get BASIX approval, which you’ll apply for in a later step.
Choosing the colour palette of your home is another important design decision. You may wish to engage a colour consultant to help you pick out a colour scheme that complements your home, its surrounds and your lifestyle.
Tip: Investing in quality fixtures and fittings for high touchpoints, such as door handles and taps, will help these items withstand daily wear and tear.
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16. Builder prepares contract
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Your builder will provide you with a written contract detailing what is (and is not) included in your build. A contract can vary from builder to builder.
The contract outlines the rights and responsibilities of you (the homeowner) and your selected builder. It ensures both parties have agreed on the build expectations, cost and time frame.
Builders often use NSW Fair Trading’s large jobs contract template for residential works costing more than $20,000. Be mindful that some builders prefer to use custom or industry contracts.
Your builder must give you a certificate of home building compensation cover before entering into a residential building work contract for any agreement that costs more than $20,000, including GST. They cannot ask you to pay any money until they give you the home building compensation cover certificate.
It is also mandatory for your builder to supply you with a copy of the Consumer Building Guide and the contract checklist before entering into a residential building work contract that costs more than $5,000.
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17. Sign contract
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You must have unconditional approval from your bank or lender before signing a contract. Unconditional approval means you’ve met all the conditions and the bank is ready to lend you the money.
It’s essential you completely understand what you’re agreeing to before you sign a contract, so take the time to read and review your entire contract.
It’s worth following the guidance of NSW Fair Trading and working through the contract checklist, as well as seeking independent advice for anything you’re unsure about.
If there is anything you do not understand in the contract, ensure you:
- ask your builder
- seek legal advice, or
- call NSW Fair Trading for assistance.
You are ready to sign your contract if:
- You have answered yes to all the questions in the contract checklist
- You are satisfied you understand your rights and obligations
- You are satisfied you understand the rights and obligations of your building company
- Your deposit is no more than 10% of the contract sum.