6 Feb 2014

A fortnight

We have had a two week break on-site whilst the final costing spreadsheet was completed and then analysed.

The build is estimated to cost just slightly more than the initial budget, which means we are now working to a contract value of about £195K, rather than £180K.  We had allowed some contingency to cover this, and in reality it is fantastic that we have got so close to the original budget. I've seen Grand Designs enough to know that often quotes from builders come back at 2 or 3 times the original budget.  However the groundworks overspend blew our contingency out of the water!

So, what would you do? Do you redesign in order to bring the costs down (which will have costs of their own; architects fees, time delay costs, potentially losing our builder to another project for a few months, etc.).  Our answer to this is 'no'. Dimitri and I are, as financial advisors like to classify it, "risk adverse"!  So we have applied our scientific background to objectively analyse the evidence and decided that we will proceed and it will all be fine!

The fabric of the building is essential, that cannot be redone at a later stage.  We have confidence that it has been designed to maximise performance in the simplest and most cost effective manner.  If compromises are to be made to the budget then that can be effected at the interiors stage.  We always knew that budgets would be tight and that creativity would be the name of the game, in fact i'm really looking forward to that bit.

Andrew has priced using a higher price index than the one we hope we be able to use (remember that local builders merchants were 20% more expensive than WTBS).  So we are anticipating a general downward trend in costs of materials.  This saving though is probably best used as a future contingency against any more overspend.

There are extras currently in the spreadsheet which may have to be stripped out, such as PV Panels.  As we are using a gas boiler for our hot water and underfloor heating it is not essential that these are installed in the first instance.

We have approached our mortgage company and asked about borrowing more money and over the phone they have agreed that in principle this should be fine.  However, just to keep everyone on their toes they don't like to approve anything until you have already spent all of your original loan.  Presumably this is because they don't want to encourage further overspend.  However, the result is that, potentially, you knowingly spend all your money before the house is finished with no guarantee of a further release of money.  Any more stress for anyone?

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