How to Choose a Builder?

Choosing a tradesman or builder without the stress typically associated with home building…


Would you choose a builder which constructs architect designed properties? Would you choose a builder which already has done the hard work of going through the land selection and design process, creating quality properties?

What does a builder do? These days many builders do not actually do the building work themselves…

Builders or building contractors:

  • Builder manages and coordinatea home building or renovation projects
  • Builder manages purchase and delivery of materials
  • Builder coordinates work of tradespeople (ie, plumbers, painters and carpenters involved in the project)

How to Choose a Builder?

  • Ask people for their personal recommendations
  • Ask other people in the industry (at least 3 referrals)
  • Ask relevant industry association for a list of names
  • Look for advertisements on television, radio, in home buyer magazines or local newspaper
  • Search Yellow Pages or relevant online directories for ‘building contractors’, ‘home improvements’ or specific trade categories.


how to choose a builder
How to choose a builder…

Would you choose a builder which can design and build for you, where turnkey packages for investors are their speciality?

  • New Homes
  • Apartments
  • Townhouses
  • Commercial
  • Industrial Buildings…

Would you prefer to see a range of properties and quality of workmanship before selecting your builder? Would the building process be much easier and more enjoyable knowing your home is finished on time, on budget and to a high quality of finish?

How to choose a builder for your needs…there are number of questions you should ask. How to choose a builder for qualifications and experience: 

  • Are the owners/manager of the company themselves degree qualified and licensed builders? It is important to have a qualified builder considering the value of investment at stake.
  • Are the builders a member of the Housing Industry Association (HIA) and Master Builders Association (MBA)?
  • Do the builders have an annual contract works insurance policy and qualify for indemnity insurance?
  • How long has the site manager been building for?
  • Does the building company own commercially established office premises? (ensure you can get in contact with them)

How to choose a builder quality assurance:

  • Does builder use leading award winning architects and interior designers?
  • Does builder use quality brand name inclusions?
  • Has builder won multiple industry awards?
  • How many building awards over what period?
  • Does building company have display home(s) and guarantee you same quality of workmanship and finish?

How to choose a builder for best product offering:

  • Does the builder offer Builders Guarantee in writing? (e.g. $500 per week liquidated damages for late completion, display home quality of finish)
  • Is the quote professionally presented and fully inclusive upfront? (ask for a written quote because many quotes exclude items which are essential for any new property (e.g. flooring).
  • Does builder provide a checklist to ensure that everything you expect to be included is explicitly listed in the quote?

You want to make sure the builder’s design service is available and they’re able to work with you to suit your budget. This means you want all documents in writing before plans are started of your budget, inclusions required, desired home size with a land survey.

Before paying your sales consultant for design/drawings ensure you get a written estimate based on information requested above. You need to establish additional and final costs for custom design.

Typically final costs can not be determined until after the architect has completed initial sketches, after this time the design may need to be increased or decreased in size and features to meet a final budget.

How to choose a builder for the true total costs:

  • Instruct builder to include allowances and advise about all possible costs before your sign contracts.
  • Make sure quote is in writing, including all site costs, bushfire costs, EER, approvals, as what you see at the display home.
  • Ask for a checklist within brochure to be sent to you…
  • Do not rely on a verbal promise to provide full upfront disclosure on all possible costs to finish and move in…make a list and ask builder if your not sure whats included

The above list is not exhaustive, it is intended to provide you with an overview of the types of information you should consider before selecting a builder.

how to choose a builder
How to choose a builder

Remember, when choosing a builder you’re in the process of forming a relationship which expires at least within one year, so you need to be very comfortable and confident you can trust the builder to deliver on time, on budget and to high quality standard you expect.

The golden rule is to make sure all builders and tradespeople have a valid licence. You can do your research online via public register to look up the licence details of any tradesman, builder or sub-contractor you are thinking of using.

How to choose a builder


Key Hidden Values Of Residential Property?

What Is Residential Property Worth In Context To Actual and Perceived Value… 

How do property investors determine  real estate property values and house prices? Let’s start off by asking a few questions about key values of residential property, key residential real estate, residential real estate values and residential land values…

Key values of residential property drives the economy into boom and bust, often referred to as property investment cycles clock (property market indicator).

property cycles clock
Key values of residential property…

The relationship between Australia’s total rateable land values (not to be confused with real estate sales) gross domestic product (GDP) indicates how Australia’s various tax regimes have shaped our land values since 1911.

Land price is now the greater part of residential property values in Australia. When people had cheap access to land and a new federal land tax, Australia experienced the highest standard of living in the world.

How does land price arise?

All discussions about declining housing affordability has ignored what drives land prices, which is simply the private capitalisation of publicly generated annual land values.

If residential returns in a particular locality are showing 4.0% after deduction of $1000 in municipal rates, and what if vacant lots are selling for $200,000?

The indicated annual value of sites is $8000 per lot net of rates (i.e. 4.0% of$200,000).

What if half of this annual yield were captured for public revenue?

The price of land would immediately fall from $200,000 to $100,000 as the $4000 annual value remaining uncaptured by government would be privately capitalised at 4.0%.

What this means is people would be prepared to pay a capital sum of $100,000 for land (site) on which they did pay annual value of $4000 to government.

On the other hand, if the existing council rates of $1000 were abolished, their price would increase from $200,000 to $225,000 (i.e. $9000 annual value capitalised at 4.0%).

So, whether people realise it or not, land price is actually private capitalisation of rent remaining on a site, developed or undeveloped, after deduction of government charges.

What is an independent property valuation?

A valuer assesses the value of land, buildings, improvements and other factors that influence the value of your property, a process that usually involves an external and internal inspection of the property.

Valuers are independent with no vested interest in the properties they value. A valuation report is a professional and legal assessment of the value of your property prepared for many different purposes.

How much does a valuation cost?

The cost of a valuation varies according to the location, size, value and type of the property to be valued, as well as the type of report required…

(i.e. short-form three page report or long-form report that is more detailed and required particularly for family law or litigation purposes).

The cost of a valuation is usually tax deductible if the property is held for investment purposes. The cost of this professional advice is relatively small compared to your investment and the potential savings and peace of mind it can provide you.

Is a valuation different from a real estate agent’s appraisal?

An independent valuation and a real estate agent’s appraisal are documents that are created for different purposes. An agent uses his expert local market knowledge to arrive at a selling figure at which the property should be placed on the market.

A valuation is carried out by a qualified property valuer for a variety of clients including banks, solicitors and individual property owners for a wide range of purposes.

What qualifications does a valuer have?

A valuer must complete relevant tertiary level qualifications, be licensed or registered by appropriate state body to practise as a certified practising valuer (CPV). Only qualified valuers are recognised by courts of law as expert interpreters of the property market.

Is a valuation different from a council rates notice?

Rating valuation is prepared for the purpose of assessing rates and land tax of a property. It does not usually involve an internal inspection and is prepared at a particular date.

The relevant date of valuation on your rates notice can vary depending upon where you live. This valuation cycle can be 12 months and up to 4 years in some cities.

What does a property valuation involve?

During a property valuation a valuer must physically inspect the property, measure the land and satisfactorily identify it against the title or plan of subdivision.

The appointed valuer will physically measure the house, take a description of its condition and improvements, take a photo and review a minimum of three comparable sales from which to conduct a sales analysis.

This information is then used to determine the value of the property. The valuer will then prepare a written report based on his or her findings.

How long is a valuation figure valid?

A valuation is valid for a period of up to three months and this can vary in a fast moving market.

What are the key factors that contribute to a property’s value?

property investing clock
Property investing clock…

There are many factors which contribute to a property’s value the most influential of which is the land component:

  • Land size
  • Location
  • Topography (shape and aspect can account for up to 70% of a property’s value)

The land component will also appreciate where building structures will always depreciate. Other factors which can influence the value of a property include:

  • Supply and demand
  • Architectural style and uniqueness
  • Design and layout
  • Potential for future development or renovation
  • Number of bedrooms and bathrooms
  • Quality of fixtures and fittings
  • Much more…

What are some of the key attributes valuers look at?

When valuing a property a qualified property valuer will consider the following:

  • Land size, aspect or views afforded by  property
  • Topography, layout of the block and house
  • Size and layout of the building
  • Location of property in relation to schools, public transport, shops and amenities
  • Architectural style of dwelling
  • Condition and state of repair of property
  • If property has renovation or development potential
  • Highest and best use for property
  • Number of bedrooms and bathrooms
  • Size of the kitchen and bathroom(s)
  • And much more…

How long does a valuation take?

On average, turnaround time of up to 3 days for a standard 3-page residential valuation report.

In this time, valuer sets up a time to inspect property, completes an internal and external inspection of property, researches comparable sales and compiles the report.

The physical inspection of property if done correctly usually takes valuers approximately 60 minutes for an average 150 square metre residential property.

How much does a valuation cost?

Valuation reports vary in price depending on subject property type and the report format required. Price for a standard 3-page report for an average-size residential valuation costs three hundred dollars (can be invaluable tool for buying, selling and assessing property).

What qualifications and memberships should a professional valuer have?

Valuer qualification requirements can vary from state to state. Non-student membership to Australian Property Institute indicates a valuer has completed relevant tertiary studies in their field.

  • Completed supervised experience in the field requirements and is meeting continuing professional development (CPD) requirements
  • Certified Practising Valuer (CPV) status is another qualification to look out for
  • A CPV accreditation indicates all the above requirements are met…

How do I find an investment-grade property?

You could take the following steps:

  • Continuously reviewing market and various factors driving demand and supply
  • Review properties for sale (both on and off-market) using a comprehensive selection technique which considers location, property type and property attributes
  • Properties under analysis are then subjected to an investment fundamentals test to ensure a demonstrable history of investment performance.

The final step for remaining properties is a peer review involving a physical inspection of the property and discussion by a team of advisers.

What is an investment-grade property?

Not all residential properties make great investments. Less than 10% of properties outperform the market growth rate in most conditions.

When the market is accelerating, only a select few properties tend to lead the pack, and when it slows, it is these properties which tend to hold their value.

As the capital value grows over time, so does the owner’s equity along with the rental dollar return these properties provide.

What is a property adviser?

A property adviser is an all-encompassing term for a suitably qualified and experienced property professional who works closely with property investors and owners as a buyer’s advocate and/or a vendor’s advocate.

A property adviser offers clients strategic property investment advice and can also review investors’ property portfolios and advise you on ways in improve its overall performance.

What does a vendor’s advocate do?

A seller’s adviser is an independent, licensed real estate agent that property sellers can engage to assist them with the process of selling their property.

The sellers adviser saves you time by helping to select the best and most suitable selling agent, advise and oversee the agent’s marketing plan, budget, selling plan, method and represent you during the negotiation process.

How much does it cost to engage a vendor’s advocate?

Your real estate agent is going to share his/her commission with your vendors advocate.
The reason this comes to you as a free service is simple, the hardest part of any sale for the estate agent is winning it.

What does a buyer’s advocate do?

Buyers advocate (otherwise known as a buyers agent) is an independent fully certified real estate agent employed to work in the best interests of a buyer in a real estate transaction.

The buyers advocate’s loyalties are with the buyer only…

Buyers advocate identifies, negotiates and ultimately buy’s properties that will build long-term wealth for his or her clients.

Their role is to share any information about the property or seller that may help the buyer make decisions regarding the transaction.

Buyers advocate is an expert on the local market and only has their advice to sell. Often buyers advocacy is one of many property services offered by a property advisory firm.

How much does it cost to engage a buyer’s advocate?

An initial discussion with a buyers advocate is typically free. If you decide to engage a buyers advocate  there’s a one-off administration fee payable up front for property specialist to do an audit on your lifestyle needs, financial position and investment goals.

If the buyer successfully buys a property identified and negotiated by the buyers advocate a percentage commission of the purchase price is payable to the buyers advocate.

In the circumstance a buyer already has a property in mind to purchase the commission on properties purchase price is much less and is simply payable to the advocate to inspect, evaluate and negotiate the property purchase.

How do I choose a buyer’s advocate?

Before engaging a buyers advocate or property adviser ensure:

  • Hold a fully certified Real Estate Agents licence
  • Are independent
  • Don’t work with property developers or real estate agents on a commission basis (no vested interest)
  • Access to a team of researchers and data so you know they are making educated decisions on your behalf…

Why are property advisers increasingly popular?

Real estate agents have a vested interest, which is why buyers and vendors are increasingly turning to advocates to represent them.

The current property market is full of opportunity – but it’s hard to know what to buy and what will provide a good return, so more people are seeking advice.

Buyers agents are common in the US and Europe and are considered to provide a valuable service.

Why should property owners use a professional management service?

Failure to be up to date with the latest legislation and industry standards can leave landlords open to liability and negligence claims.

Also, landlords often lack the time to establish clear and detailed reporting systems and subsequently overlook issues or opportunities which impact the growth of their asset.

How do you select a property manager?

Select a company that is professional and works in partnership with you to establish reporting and analysis systems that will enable you to step back and make better decisions about funding purchases and equity.

Good questions to ask include:

  • What compliance system do you have in place to avoid human error?
  • Have you got dedicated experts in areas such as a lease administrator, accounts, property management and asset management?

Why do many people blindly dive into property investments without knowing a single fact about the risks of property investing?


Residential Property