The truth about building quotes that most Canberra homeowners don't know (until it's too late)

Of all the anxieties that families carry into a building or renovation project, budget is almost always the biggest. And rightly so, this is one of the largest financial commitments of their lives.

Research published by Houzz at the end of 2025 found that project costs were the number one concern for homeowners considering renovation work in 2026, cited by 80+% of people. In my experience after 25 years, that figure feels about right.

What frustrates me is that most budget blowouts are preventable. They don't happen because building is inherently unpredictable. They often happen because of specific, well-understood gaps in the process that are entirely within your control to close.

The Cheapest Quote Is Almost Never the Cheapest Build

A building quote is only as reliable as the documentation it was based on. When a builder has detailed, accurate drawings and a comprehensive Inclusions Schedule to work from, he can price the work properly, confidently and competitively. When he doesn't, he fills the gaps with estimates and allowances known as Provisional Sums.

A Provisional Sum (PS) is essentially a placeholder. The builder is saying: 'I don't know what this will cost, so I've estimated.' And when the real cost comes in, during construction, when you have no leverage, you pay the difference.

Under the standard HIA and MBA building contracts used across Australia, the builder is entitled to charge up to 20% margin on top of the difference between the Provisional Sum and the actual cost.

One client, many years ago, discovered this the hard way. She chose the lowest quote, which was loaded with Provisional Sums. By the time construction was complete, she had paid $82,000 more than her contract price. The 'cheapest' quote turned out to be the most expensive build.

What 'Fixed Price' Actually Means

Builders will often market their services as 'fixed price contracts'.  The idea is sound, and generally well intentioned. But the reality is more complicated.

A fixed price contract is only fixed for the items that have been properly included in the quote as fixed costs. Provisional Sums sit inside the contract as estimates, and they are, by definition, not fixed. The more Provisional Sums in your quote, the more of your project is exposed to cost variation.

When you're reviewing quotes, ask every builder to clarify each PS. Many will be reasonable; like for the kitchen joinery and benchtops which have not been designed for selected yet.  Others may be questionable; something like the wall cladding, which should be a fixed cost if the material is specified and the quantity measurable.

The 20% Rule Nobody Tells You About

Every time you make a change to the scope of work during construction, even something that seems minor, the builder is entitled under the standard contract to charge up to 20% margin on top of the actual cost of the change.  Some builders will capture every single change and apply a margin (more likely from the builder who was cheapest to begin with).  Others will not apply the margin in cases where the item/task was already within the scope of works.

This is a standard contractual right. And it's the reason why getting your decisions made before construction begins is so much more important than most people realise.  If that’s not possible, at least get some assurance that Provisional Sums are created by calculated estimates, not random and meaningless guesses.

The Document That Changes Everything: The Inclusions Schedule

An Inclusions Schedule lists every fitting and finish in your home, taps, tiles, appliances, flooring, light fittings, kitchen joinery; along with the allowance that the builder is pricing for each one.

Without it, builders quoting your project have to guess at what you want. Builder A might allow $3,000 for bathroom taps. Builder B might allow $800. Both quotes include 'bathroom taps' — but you're not comparing apples with apples.

With a thorough Inclusions Schedule, every builder is pricing exactly the same scope and standard. The quotes are genuinely comparable.

Want to understand what your project might realistically cost, and how to protect your budget from the start? Let’s talk… 30-minutes. Honest, practical, no obligation. Call 02 6260 8868