Builders Margins

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  1. #1
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    Default Builders Margins

    This is my first post on the forum. Technically I am an owner/builder but the financing bank,(CBA) dislikes this concept so much that they want the work done through a registered builder so they can pay him, not me. I have sourced a lot of services and trades for this project which the builder is prepared to use (it is a Queenslander to be relocated on to a small acreage plot in the Sunshine Coast Hinterland and is to be totally renovated and extended). So, now those trades/suppliers will do their work for my Builder, ( he is the one who is supplying the old house). The builder is entitled to an add-on fee for every service supplied but what percentage is he likely to expect? I don't want to offer anything more than I have to and would be happy with a 5% loading, though I can imagine it will be higher(maybe 10%). Has anybody got any experience of this type of arrangement?

  2. #2
    Je pense, donc METRIX's Avatar
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    Default

    By Technically, what do you mean, have you done an owner builder course and got your Owner Builder certification from the Dept of FT.

    With your question for 5%, I imagine you would be paying more than this, I know I would not do any job for a 5%.

  3. #3
    4K Club Member ringtail's Avatar
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    Its more like 25 - 40 %. If, as the builder, you are taking the responsibility for other tradies work you have to make money out of it.

  4. #4
    Member BalliangBuilder's Avatar
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    Default Re: Builders Margins

    We add 10% profit plus overheads, we hardy miss a quoted job.

  5. #5
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    If it is structured in a cost plus style contract 10 to 15% would be considered normal for "simple" type building work.

    Work of a high complexity and requiring substantial on site negotiation, problem solving and coordination of trades would be higher, depending on complexity.

  6. #6
    Apprentice (new member)
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    Default Thanks for the feedback

    Re the Owner/builders course - No point in doing that as it will not now be an OB situation. In our case we are really talking about the additional amounts the builder will charge us for the Structural Engineer, Designer Draftee, Surveyor and Private Certifier. All of these have dealt directly with us but will now be paid via the builder. I guess I ought to be happy with a 10% mark up. The builder is getting the bulk of his margin from the sale and relocation of the house plus what he will get from the new roof to be installed by a contractor together with some internal structural changes.
    Anyway thanks to all who responded.

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