Browse Forums Owner Builder Forum 1 Dec 08, 2009 2:48 pm We have finally decided to go owner builder with the builder being our site manager. His fee is 11,000. this includes 5,000 deposit and 1,500 for slab stage, frame, fix, final finish. The extras are 48 hours notice for extra visits billed at four hour minimum of $300 plus travel time. What do you reckon, is this standard? If he was to take on the project fully he would take 20% of the cost to build. Project cost approx $550,000. Re: Owner builder and site manager fees. 2Dec 08, 2009 8:16 pm Looks like an expensive building project you have there. The costs of management fees is hard to determine , but looking at total construction costs of $550K, it seems like a big job. Have you had a quote for a builder to build the whole thing for you? Regards Shane Re: Owner builder and site manager fees. 3Dec 08, 2009 8:51 pm You said he's not taking on the job "fully", so have you clarrified with him what he's actually responsible for? Sounds like he's only coming out at the stages you listed, is that correct? So he's inspecting the stages? If thats al he's doing, wouldnt an inspector be better value for money? (these are random thoughts so take them with a grain of salt as Im unsure ) Custom European Cabinets - Melbourne Kitchen Specialist PM for business details as website currently being updated! Our Crazy Owner Builder Journey! Re: Owner builder and site manager fees. 4Dec 10, 2009 9:20 am Yes, if we go owner builder, the builder will be our site manager but we will use his workers, he will co-ordinate them but have no responsibility for them. He will come out for those stages as part of the $11,000 and extra if we call him out more often. He reckons the bill will come in at $15,000. He is a Master Builder and reckons that with his workers, the 2 storey 45sq house will be finished in 6 months. That's pretty good. If we start finding our own contractors it will take us forever and lost money in rent. Otherwise if the job is 550k and he takes 20% thats over 100k in his pocket. What are the fees like for a building surveyor? I have not gone down that road at all. Re: Owner builder and site manager fees. 5Dec 10, 2009 9:55 am One thing that crosses my mind is that you say you have a $500K project. If I had $500K project I would not be expecting it to take only six months. A bit like going to by a Porsche and them saying it will take two weeks to make from scratch. I don’t think you will end up with the finish that you would expect from a house of that cost in only 6 months. Also "Master builder" what does that mean. Does it mean he has paid is $500 and joined the Master builders Association. Just to put things in prospective anyone can join even if they are studying to become a builder. ALso how do you not know that he is getting his trade people to invoice him from his other work and adding them to your project. Re: Owner builder and site manager fees. 6Dec 10, 2009 10:04 am A few questions that I would raise: - Who obtains the subcontractors prices ? Using "his guys" doesn't necessarily mean you are getting the best quotes. - Who priced the job ? Is there a list of inclusions, fixtures, etc. $550k for a 45sq home sounds expensive. You should be able to get a good quality home, with good finishes built by a builder for that amount ($12k per square buys a lot). If he puts his margin on top to build it under his licence, then it's coming in at $650k. If you are in Melbourne, and have standard finishes in the home, I'll build it for you for $550k all up - How is he going to coordinate subcontracors if he is only visiting site 4 times (ie slab, frame, lock up, fix). How will he know if one subbie has completed his work for the next subbie to move on ? Who is checking the subbies work as the job progresses ? Just the main stages is not enough. Things like making sure everything has been roughed in correctly before plasterboard is installed is one of the "in-between stages" tasks that needs to be done. Paying him $300 plus travel for every time you need him on site to check something could end up costly. - He'll have no responsibility for his subbies, so who is checking that their work is done correctly and to a reasonable standard ? - I assume you are paying his subbies directly ? Who will be checking off variations, etc. How will you know if the variation is legitimate, or should be been allowed for in the first place (who is letting the orders to the subbies ?) - As he has no responsibility for anything, that includes time. Saying it will take 6 months is all fair and well, but I think it is rather optomistic for a supervisor who won't be "supervising" all that often. Remember, that as he is not using his licence to build the house, if he or his subbies stuff up in any way then you are fully responsible. It sounds like you may think that you'll be able to sit back and watch the house get built, but this is probably very far from the truth. As Bam said in the earlier post, it may be better to run the project yourself, then employ an independent inpector at a few hundred bucks a pop to inspect the house during construction for defects you may not be able to see. Better yet, obtain a few quotes from builders to build the home. If you finishes/inclusions you want are reasonable, I don't see why you couldn't build the home with a builder for your budget. My post may sound negative, but the way I see it you are paying a guy $11,000 to make a few phone calls and visit site 4 times. If you actually want him to run the project like a professional supervisor, then it's going to cost you an extra "$300 plus travel" numerous times. He also won't have your best interests at heart and probably won't care too much about any extra costs that may be required during the build. You can almost guarantee that something will always go wrong during a build. Blog is now up - http://www.jbdave.blogspot.com/ Re: Owner builder and site manager fees. 7Dec 10, 2009 10:13 am Quote: ALso how do you not know that he is getting his trade people to invoice him from his other work and adding them to your project. Exactly my main point. Who is pricing this job and who is paying the subbies ? Blog is now up - http://www.jbdave.blogspot.com/ Re: Owner builder and site manager fees. 8Dec 10, 2009 10:31 am Yes, thanks. These are exactly the sort of things I need to hear. The finish will not be standard but mid to high. 3m & 2.7 ceilings, stone tiles in bathrooms, stone benchtops, ref heat/cooling etc. Yes we will pay the subbies directly, not to the builder. The builder welcomes any quotes lower than his. I have had about 5 quotes and no one has come in lower than $550k. Your points are valid and I will definately talk to a building surveyor now. Re: Owner builder and site manager fees. 9Dec 10, 2009 10:40 am You want an independant inspector, not the building surveyor. The building surveyor won't check for general defects, etc. He'll only check for compliance to the relevant codes and regs. If this "builder" has come in at $550k, do you know everything has been included ? He may welcome any cheaper quotes, but it's not a big thing to say when he is accepting no responsibility on the project. If he has missed something, then you pay for it, not him. If he quoted the project to build as a builder, and if he misses something, then it falls back onto him. Blog is now up - http://www.jbdave.blogspot.com/ Re: Owner builder and site manager fees. 10Dec 10, 2009 10:41 am I personally would never use a builder as a site manager (no offence to all the great builders out there that do a fantastic job for their clients). You have to ask yourself, who do they represent, you the client, or the firm they work for/own? A quick look through the HIA and masterbuilders contracts would indicate that they are weighted in favour of the contractor, not really suprising though. Have you thought about using an independent project manager? Andy Re: Owner builder and site manager fees. 11Dec 10, 2009 10:47 am Good points Andy. It just sounds a little ******* with the builder "supervising" the project and his own subbies for a fee. As Andy said, an independent PM would be your best bet. He could supervise the project and advise on certain issues. YOu could source subbie quotes - which isn't a difficult thing to do. Blog is now up - http://www.jbdave.blogspot.com/ Re: Owner builder and site manager fees. 12Dec 11, 2009 8:43 am that seems like an awful lot of money for a 2 storey 45sq home. maybe go see a quantity surveyor and get them to estimate the real costs involved sounds like the builder is laughing all the way to the bank at $2700 per visit and no responibility if you want quality take your time you may pay more rent but your home will be finished to the standard you dreamed of saving you heaps of money in the long run. at 6 months for a mid-high standard house you may as well go to a project builder because thats what you wil get in the end good luck whatever way you decide stay safe happy building Re: Owner builder and site manager fees. 13Dec 14, 2009 12:27 pm Next quote has come in at around 530k. For us to be owner builder he charges 10% of the build fee, if he was to build under contract he would charge 25%. He lives around the corner so visiting the site would not be a problem unlike the other builder from the other side of Melb. He will be the chippie on the job also , we pay him his rates of course. He invites us to get our quotes and use them if we wish. No hidden fees like travel or after hours just flat 10%. That's much dearer than the builder with 4 stages fees plus extra for site visits ! What's goin' on? Much of the same as the other offer I think. No responsibility for too much money. The problem is if you want to save money on the builders margin what choice do you have other than being an owner builder, but if you are not experienced in building practices and don't know who the good quality workers are, you are stuffed. Re: Owner builder and site manager fees. 14Dec 28, 2009 1:44 pm It's a tough one. Most Project Managers are not qualified to supervise building works only administer the paperwork side of things so these needs to be considered when sourcing a private Project Manager. Secondly there may be a conflict of interest with the builder just using his own guys without sourcing other quotes, however it is possible that he has good rates as they are regular subbies. if he is going to be engaged to supervise the work then he needs to be there every 2-3 days and daily during the important stages. I am a big believer in OB paying for professional Project Managers, just need to ensure the right people are on your team. If you need to pay for a project manager you would be well advised to just engage a builder who would take full responsibility for the build. As opposed to you OB where… 5 15085 Is it just a report written to give to the bank initially and it is based on what and how your payments are made up for, or is it a full service where they go out and… 2 5605 |