Building your dream home is supposed to be one of the most exciting milestones of your life. But too many homeowners end up tens of thousands of dollars over budget as a result of two easy-to-avoid mistakes: 1) locking in a design without consulting a builder, and 2) choosing a cost-plus contract.
For instance, John from Newcastle was blindsided by a $40,000.00 cost blowout due to unforeseen concrete peering requirements that weren’t accounted for in the original plans. Here’s 3 steps he could have taken to avoid falling into this trap:
Step 1: Ditch Cost-Plus Contracts — They Shift the Risk From the Builder to You
While cost-plus contracts may seem flexible and transparent, they can turn into a blank cheque for builders. Every small change, every adjustment, and every unaccounted detail means extra costs added to your bill.
For instance, if timber prices rise midway through your build, you pay the difference — not the builder. If the project takes longer than expected due to poor planning, you’re on the hook for additional labour costs. Even minor design tweaks — like upgrading fixtures or adjusting room dimensions—can lead to unexpected upcharges, quickly inflating your budget beyond what you originally anticipated.
But with a fixed-price contract, you can lock in your price upfront, guaranteeing you know exactly what you’re paying before construction begins — no nasty surprises halfway through the build.
Step 2: Involve Your Builder From Day One
Involving your builder early in the process is the best way to keep your design on track, while helping you avoid expensive mistakes.
Bringing your builder in early lets you:
- Ensure your vision aligns with your budget from the start.
- Avoid costly last-minute design changes.
- Get real-time insights on material costs.
- Prevent budget blowouts before they happen.
This step alone can help you stay within your financial limits and maintain peace of mind throughout the process.
Step 3: Plan for Every Cost Upfront
When it comes to building a home, every detail matters. From the foundations to material selections, missing just one detail can cause unforeseen costs that add up quickly.
By locking in all costs upfront, you can avoid:
- Unexpected material price hikes.
- Extra structural support costs.
- Costly redesigns that delay your project.
With a clear, upfront agreement, surprises can be avoided — and better yet, your home is far more likely to be finished on time and on budget.
Sarah Took a Smarter Approach, Involving Her Builder From Day One
Unlike John, she understood the importance of early involvement and made sure her builder was consulted during the design phase.
Before locking in any details, Sarah and her builder reviewed the plans together, making sure everything was within her budget.
By choosing a fixed-price contract and collaborating with her builder early, Sarah secured her costs upfront, which meant no surprises during the construction process. Sarah’s proactive planning saved her thousands of dollars, avoided stress, and kept her project on budget.
The Home Building Process Doesn’t Have to be a Financial Nightmare
With proper planning and the right team, you can turn your custom home build into an exciting and rewarding experience.
Of course, this is only one piece of the home-building puzzle. That’s why we’ve designed this comprehensive guide to help you build smart from the start:
7 Things You Must Know Before Designing a New Home
Inside, you’ll find:
✔ How builders price variations
✔ What to look for in a contract proposal
✔ The biggest myth about copyright
✔ How to spot a bad builder early
✔ And much more!
Click here to download your copy today
*Disclaimer: Names and identifying details have been changed to protect the privacy of individuals. These stories are based on real events, and any resemblance to actual persons is coincidental.
