What Is a Preliminary Building Agreement? Here Is Everything You Need To Know

What is a Preliminary Building Agreement?

A professional builder will produce a Preliminary Building Agreement (PBA) to provide the final design drawings and specification documentation and a fixed price quotation. The benefits of this include…

• You  work together on the final design to deliver your requirements with regards to aesthetics, function, and budget
•  In addition to the design drawings the builder works with you to finalise finishes and colour selections so once the build starts it’s all predetermined and you can enjoy watching your home come together
• You have every bit of information to complete a detailed fixed price quotation with no need for open ended Provisional Sum (PS) and Prime Cost (PC) allowances that may run over budget and cost you more down the track
• When that quotation is complete and the decision is made to sign off on a Building Contract, the documents are ready for submission for building approval, and you can get started without delay

Further, a professional builder can manage the whole process for you. That way you don’t have to go and find the surveyor, the geotechnical engineer, an architect, a structural engineer, a hydraulics engineer or a selections and colour consultant, get fee proposals from them all, manage and coordinate them to make sure they not only deliver what you want, but also stay on the same page as each other.

By utilising a PBA, you remain in charge, the builder just does all the leg work so you can focus on the final outcome and enjoy the journey.

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What does a PBA include?

Before you sign the Preliminary Building Agreement, it is important to understand what your PBA contains. An in-depth PBA would include the following information as part of the agreement with a professional builder:

Geotechnical Engineer’s Report (Soil Test)

A test of your soil to confirm the type so that it can be used to formulate the best possible and most cost effective foundation type.

Site Contour Survey

If you have a sloping site a professional builder will produce a detailed contour survey plan to ensure that the building is designed to suit the site so all construction costs can be captured. 

Energy Efficiency Report

The PBA would outline details such as insulation, orientation, window glazing, heating and or cooling systems to make sure it complies with the relevant energy standards.

Architectural Detailed Design 

It contains the full set of complete architectural drawings, building plans and specifications required for your building project, and also including:

• Electrical layout plans
• Exterior and interior finishes schedules
• Wet area internal elevations and joinery layouts
• Sanitary, appliances, lighting and electrical and window coverings schedules
• 3D imagery

Structural Engineering Design 

All structural design elements to ensure the building's ability withstand cyclonic wind conditions and general site conditions etc.

Hydraulic Engineering Design 

To ensure that you have continuous and consistent water pressure to all of your plumbing fittings and fixtures, it’s important that your water service and drainage is designed to suit the specific hydraulic services of your home. Further, a professional builder will have a hydraulic engineer calculate the size of roof guttering and the size and number of downpipes.  

Fixed Price Contract Quotation

On completion of the above design documentation a professional builder can then prepare and present you with a genuine Fixed Price Contract proposal to build your Custom Home with everything covered. There is no “guestimation” or use of Provisional Sums (PSs) and Prime Costs (PCs) so there are no surprises down the track. 

Benefits of Having a Preliminary Building Agreement

So now you know what a Preliminary Building Agreement is and why it is important to have one. We're sure you have realised the benefits of having a Preliminary Building Agreement, but here are the top 3 major benefits of signing a PBA before you begin building your custom home:

• It protects you from hidden costs, as everything is covered so that there are no surprises down the track..
• It can help you avoid costly disagreements or disputes between you and an unorganised builder.
• A PBA makes the construction process more smooth and transparent for both parties.
• It helps to ensure that your project is completed on time and on budget.
• A PBA gives you full control of the entire building process.

Why does the cost of a PBA vary from Builder to Builder?

It's also important to understand why the cost of a PBA varies from builder to builder. A few builders may give you a low-cost PBA and there might be several reasons for this:

• The area you are building is very well known to the builder, and they might have built there in the past and they take a guess that the site conditions are the same.
• Or the builder constructs the same design over and over, so they have the plans ready.
• Or the builder doesn't customise the PBA and just applies the same generic document to all the prospective clients, no matter whether it assists them to determine a fixed price or not.

These low costs and generic PBAs are often provided by builders who want to save their time and resources, so they prefer not to determine an actual fixed price of your project, which means they will eventually charge you extra money down the road because they have not created a customised PBA for your project that's suitable for your project requirements, your block and your dream home.

On the other hand, a professional builder may charge you more for the PBA, but their aim is to save you time and money, from the initial investigations to preparing a thorough PBA right to the handover of your keys.

They will create a customised PBA for each and every client, which means they will make the necessary extra efforts to determine an exact fixed price of the project during the early stages of your building process.

Risks of not having a PBA

^People often overlook this part of the building process, and by not doing their due diligence to understand the importance of these agreements, they end up paying more for their project in the long run.

Without a Preliminary Building Agreement you could end up with a project plan that isn’t designed correctly, a builder who doesn’t understand your needs to quote it properly for all the inclusions and specifications that are not clearly outlined; resulting in the final price being way out of what you originally expected.

A PBA is a very important document that protects the interests of both parties, whereas without it you can’t have a fixed price for your project, so we highly recommend you to engage with a professional builder who can provide you with a detailed and comprehensive Preliminary Building Agreement to ensure that your quote and the process to build your dream home is accurate and detailed and a true fixed price.

A PBA is an Essential Step of Our Home Building Process

At Live Construction, we help our clients be more involved and aware of the processes that happen in order to build their dream home, so we provide every client with a detailed PBA that outlines all the essential reports, costs breakdown and other information required to build their custom home.

We understand the importance of this step for both our clients and our business, so we have a dedicated team to research each block before a PBA is created. We go through all the new reports from local councils, land experts and other building professionals to ensure our clients have a detailed understanding of the building process.

So if you’re looking for a professional builder in Townsville who is dedicated to providing you with a stress-free building experience, feel free to contact us today at 07 4724 1964 or you can book a 30-minute free consultation with us.