When building work is about to start, make sure everyone knows what is happening and plan how you will keep scope and budget on track.
The keys to a successful building project are good planning and good communication.
Before work starts
Before any work begins, make sure you've agreed:
- scope — the specifics of exactly what work will be done
- budget — ideally you should have a fixed price from your contractor, and access to contingency funds if things don't go to plan
- timeframes and what will happen when
- who does what
- how you will communicate
- the process if things go wrong.
Read about how to Communicate for a smooth job
If you're managing the project yourself, you must have:
- approved building documentation
- sub contractors organised
- have considered possible risks
- a quality system with check sheets
- a site health and safety plan.
Project management(external link) – Building Guide
If your building project is worth more than $30,000, make sure you've read and signed a written contract. Your lead contractor should also give you a disclosure statement and standard checklist.
- Read more about Building contracts
Keeping in scope and budget
Almost all renovation and building projects have something that doesn't go to plan. Make sure you have a contingency budget and an agreed process on how to manage variations, if issues come up.
Read more about how to Plan a renovation
Communication is key
Make sure you have regular catch-ups with your contractor, including:
- scheduled weekly meetings or emailed work in progress updates
- casual chats, both face-to-face and over the phone or by text
- keeping track of smaller things and sending a summary email of any minor issues or outstanding work to your contractor weekly.
Sticking to timeframes
- Hold your main contractor, sub contractors and suppliers to account. If they say they’re going to be there on a specific day and time, make sure they are, or have a good reason why they're not.
- Use lists and spreadsheets to make sure things are happening when they should.
- Have a regular work in progress update session with your contractor.
- If you're ordering materials or organising the building consent, do it early – you don't want delayed stock or slow council processes to hold up your project.
- Avoid making unnecessary changes to what's been agreed, especially if your changes will impact on when sub contractors can do things.
There are some things that can cause delays outside the control of you or your builder, like bad weather or injury to a worker. Be understanding and work with your contractor to find the best solution to avoid getting too far behind time.
Some delays like bad weather are unavoidable. Be prepared to find a solution.
Changes to the scope of your work are called variations. Variations should be put in writing within a certain time frame — check what your contract says. Make sure your builder and sub contractors know what process to follow when a variation is needed, including what will happen if a variation — or change — is made without your approval.
Read more about Building contracts
Agree on a process for dealing with changes. Put changes writing.
Milestones and payment schedules
If you have a contract for your project, it should include a schedule of payments linked to specific milestones and approximate dates for the payment to be made.
If you don't have a contract, agree with your contractor at the beginning of the project when payments will be made.
Always stick to the agreed payment schedule, unless there's a good reason not to, eg the work for that milestone has not been completed and there is no reason for the delay.
Pay on time unless there is a good reason not to.
What to do if you run out of money
As soon as you start to have concerns about project costs, talk to your contractor. Agree what work to prioritise to ensure that your house remains liveable, and see if there's a way to stagger the rest of the work to complete it as you can afford to.
You could also talk to your bank to see if you can extend your renovation loan or add a top-up to your mortgage. Make sure you pay it off as quickly as you can, and avoid using high interest debt like credit cards to fund your renovation, unless you can pay them off very quickly.
If you're doing some things yourself
Doing some work yourself can be a great way to save money — but be realistic about what you can do. If you're not experienced with DIY, you could end up causing issues rather than saving money.
Have a chat with your tradesperson and make sure you understand:
- how much time any job you take on might take
- the knock-on effect if you can't get a job done in time, eg holding up sub contractors
- any Building Act rules or requirements relating to the work you're doing
- if there's any implications for implied warranties or builders' guarantees if you do the work.
If you're ordering materials, check with your contractor to see if they can get a better price. Confirm when they will need them to make sure anything you order arrives in time.
Be sure to order materials to arrive on time.