Before you begin engaging a builder for your new home or other building project, it is important to reflect on what pricing strategy you want to proceed with.

Fixed-price contracts, the norm in Australia, enable you and your builder to agree to a contract sum which is fixed and only subject to approved variations under the contract.

The alternative is cost-plus contracts which allow for payment for the actual cost of building in addition to a fee as agreed with your builder for their overhead, management and profit. This fee can either be a percentage of total costs or a flat fee.