Our War on Building costs - 12 design strategies to save you money (and 12 things not to do)

Building costs have exploded during Covid but they have disproportionately affected smaller projects with difficult access and complicated builds. This is because both the cost of labour and timber has accelerated a lot more than other things driving the cost of a typical extension in the inner west on a small site up by over 50% since the start of 2020.

We’ve mobilised to meet these costs head on and have laid out the following design strategies in our war on building costs in a quest to construct cost-effective buildings without sacrificing quality.

The greatest cost savings are inevitably banked during the early design and planning phase. Here are 12 strategies that can help slash building costs without cutting corners on quality:

1. Reduce the Size of the Building

Optimising the use of space can lead to substantial savings. By carefully assessing needs and eliminating unnecessary space, you can reduce material and labour costs significantly.

That said we should note that not all spaces are created equal - and priced equally. Marginal adjustments to floor space have marginal cost implications. There are 2 key factors at work here:

A. Wet areas and kitchens are the most expensive parts of most houses. So for example deleting a small bathroom can save 5-10 times as much as deleting the same amount of floor space from a bedroom.

B. There is a sunk project cost including design, management, utilities and site operation that doesn’t really change if your building was say: 1 metre shorter but every thing else remained the same, so it’s really just materials and labour for that bit of roof, floor and wall.

2. Focus the Entire Team on Value and Efficiency

Collaboration among architects, engineers, and contractors to find cost-effective solutions without compromising quality is essential. Efficiency should be a collective goal from the outset. But how you frame it makes all the difference.

3. Simplify Spaces, Roofs and the Building Design

Complex designs and layouts can increase both material costs and construction times. Simplifying the design can lead to a more efficient construction process and lower expenses, the less junctions, the less corners, the less step ups, step down, gutters, downpipes….you get the picture.

4. Reduce Spans

Minimising the distance between supports can decrease the size and cost of structural elements. This approach requires less material and labour, contributing to overall cost savings. But it’s not just less material, reducing spans can mean deleting heavy steel elements from the building, meaning that everything is built from stock timber. This means no shop drawing, review by engineer and production time, less project management time

5. Increase Floor, Roof, and Wall Thicknesses

It is well known that investing in thicker walls, floors, and roofs can improve insulation, reducing energy costs over the building's lifetime. What is less known is that thicker walls, floors and roof spaces can also simplify and save money on construction. But why?

In trying to get additional space into buildings we design minimal wall and ceiling spaces making buildings more complicated than they need to be. More space makes it easier for services that go into walls, floors and roofs like plumbing, electricals, AC and ventilation. It also helps with creating falls for roofs and waterproofing of wet areas providing larger tolerances and simplifying the structural work. Any experienced builder will also tell you that it’s the intangible costs that are most apparent - the more you can reduce head scratching and problem solving the faster things happen and the less they cost.

So a caveat here - simply increasing the thicknesses is not a saving in and of itself, it’s the strategic increase in some areas that makes all the difference.

6. Delete Bricks

If there is one trade that is in short supply it is brick layers. They are now the most expensive trade and bricks are fast becoming a luxury finish - a far cry from the mass produced brick veneer homes of the late 20th century. Considering alternative materials to bricks can offer other benefits. Why? Turns out bricks are not great as an insulator. The irony of a brick veneer house is that a reverse veneer is much more environmentally efficient - yep bricks on the inside lightweight on the outside makes a whole lot more sense from a thermal comfort perspective. In a nutshell this is because of thermal mass of the bricks being insulated keeps the temperature more stable inside your home.

Bricks were traditionally used only for their cost effectiveness, durability and aesthetics. As the durability of modern cladding systems is 10x better than what we had last century and with cost effectiveness wiped from the equation it’s really down to aesthetics and style.

7. Use commodity type materials that are always in stock.

How to find commodity type materials; Simply walk down the aisle at your local bunnings and see what’s in stock and what has the lowest cost per m2. Opt for solutions that use simple readily available products - like particle floor sheet flooring, simple cladding systems, using standard products. But a word of warning; using the wrong product for the wrong application can lead to problems - so you need to ensure that the material is fit for purpose.

8. Delete Balconies and Roof Gardens

While aesthetically pleasing, balconies and roof gardens often do not offer a return on investment proportional to their cost and maintenance requirements. Eliminating these features can save money without impacting the building's functionality. There are ways

9. Rationalise Design to Decrease Number of materials, building methods and trades

A streamlined design can reduce the variety of required trades and materials ordered. For each material ordered you can

10. Downspec Materials

High-quality laminates are a fraction of the cost of natural stone, offering durability and style without the high price tag. The thing you want to avoid is trying to use a laminate that pretends to be a natural piece of stone, lean into the material in its raw state, if its laminate, let it be laminate, don’t pretend that it’s something else.

11. Downsize AC but Upspec Windows and Doors

Opting for less expensive air conditioning systems and investing in high-quality windows and doors can improve energy efficiency and reduce long-term costs. Most AC systems are designed to cool spaces quickly. But if you have an energy efficient house and you really only just want something to take the edge off hot and cold days then speak to your AC installer about downsizing units so they suit your needs.

12. Simplify Roofs

Choosing simpler roof designs can decrease construction complexity and material costs, while still providing protection and style. My favourite question to ask the design team; ‘if we made those 3 roofs into one roof who would know?’ a lot of the time the answer is that not many people would ever perceive the difference. A simpler roof is not only simpler to build but it is less likely to have ongoing maintenance issues.

12 Cost saving measures to avoid

Even as we seek to reduce costs, certain elements are non-negotiable due to their impact on the building's integrity, energy efficiency, comfort and the project’s return on investment. Here's a list of things we won’t do to reduce costs:

1. Compromise on Great Spaces

When you compromise on the quality of spaces, flow and function you devalue the project beyond any cost savings. This is why so many developments fail. They are focused on spreadsheet yield and sure in a great market people will buy anything but once the market cools, low quality spaces are hard to sell.

2. Compromise on Quality of Windows and Doors

These are crucial for security, energy efficiency, and aesthetics. High-quality windows and doors can significantly reduce energy costs and enhance the building's overall value but great looking windows and doors connect spaces like indoor to outdoors - getting them to look just right changes the nature of each of the spaces and the connection between them. Not to be understated is the fact that great window contractors will help to seamlessly integrate the window system into the building ensuring that they never leak and fit seamlessly.

3. Compromise on Roofs

Ok so how do we have roofs in both the ‘cost saving’ and ‘never a cost saving’ category? On the saving side - if we can create one simple roof from 2 complex roofs with minimal impact on the rest of the building then this is worth doing. But we never want to compromise on function and quality of roof material and workmanship.

4. Reducing or deleting Insulation

Good insulation is essential for energy efficiency and comfort. The cost of insulating a home is such a marginal cost in the overall scheme of things it’s never worth leaving out, in fact if anything it’s something to up-spec. But, whether it’s polyester or organic lamb’s wool, as far as I know an R-2.0 batt is an R-2.0 batt so you can save money by optimising the material which is cost effective and easy to install.

5. Quality and Detailing of Waterproofing

Proper waterproofing prevents moisture problems, which can lead to structural damage and health issues. It's a critical component of any construction project.

Waterproofing is not about getting liquid membrane to stick to a floor or wall, it's about the art of junctions and seamlessly integrating the waterproofing system to all of the other building systems. It’s an art as well as a science. The really great waterproofers are 10x better than the - how you say - not so great ones.

6. Engineering

The structural integrity of a building is paramount and it is unlikely that your engineer will design a substandard product. But an engineer who is focussed on efficiency and understands the construction process may cost you more to begin with but can save you 10x the premium in cost savings.

7. Tile laying

There is nothing worse that a beautiful and very expansive important stone or ceramic tile that is poorly laid. On the flipside a cost effective and simple tile perfectly laid changes the nature of the material and the space.

8. Quality of Electrical, Plumbing, heating and AC Systems

High-quality electrical and plumbing systems are essential to prevent future problems that can be expensive to fix. Sure reduce the number of bathrooms, reduce the size of the AC units but use a quality supplier and quality installer.

9. Avoid pre-fabricated solutions

Prefabricated buildings - you know they ones - apparently cost effective because they are built in a controlled environment in a factory somewhere. Well they could be cost effective one day, but today they are only effective if delivered at scale, if you don’t have scale - like 10,000 square metres or more then you should stay away from anything prefab, it will slow your project down and you might find the real cost is much more than you expect.

10. Environmental Sustainability and future proofing

Sustainable features may have a higher upfront cost they can offer significant savings and benefits over the long term, including energy savings, tax incentives, and a better environment for occupants. But it’s not an either/ or question. What is cost effective during construction is making provision for future solar or battery

11. Air Quality and Ventilation

Good indoor air quality and proper ventilation are essential for the health and comfort of building occupants. High-quality HVAC systems and materials that do not emit harmful substances are critical.

12. Plants

The right plants (or trees) in the right place offer a great return on investment because you will inevitably need to plant something if you have a garden and adding $5-10K to the plant budget can be nothing short of transformative for your property.