Why your budget is not your brief

Dear potential client,

When you first approach us to design a house for you, before you sign us up, you come armed with two things: a brief and a budget. Your brief might look something like this:

brief

In fact, one of the first things we do when we are commissioned is to help you expand and enhance your brief even further, articulating detail and fleshing out your dream. This includes descriptions of your family, an explanation of how you like to live, an estimate of how much space your house will need, individual room requirements, what feeling you’re hoping to achieve, examples of details you’ve seen and liked, and how long you intend to live in the house. This is a task of thorough research, aimed to extract as much information as possible about your aspirations for the project so that we may best tailor it to your specific needs.

At the same time, we ask for your budget, which might look something like this:

20130111 budget

One number undoubtedly shaped by considerable contemplation, deep assessment of financial circumstances, and much worry over land capitalisation. One number that has a powerfully defining impact on the project yet to evolve. One number that means a lot to you but as yet has nothing at all to do with your brief.

Until we have performed a feasibility study, or obtained a cost estimate from a quantity surveyor, both of which provide an understanding on how much your brief is likely to cost, it and the budget are in no way connected to one another. It is the same as walking into a car dealership and telling the salesperson you want a shiny new car for $500. Unfortunately, wishing it does not necessarily make it so. Anyone who tells you otherwise is not telling you the truth, but what you want to hear.

We used to give potential clients advice in the very first meeting about whether we thought their budget aligned with their brief. We learnt the hard way that when a potential client is told upon first contact that the considerable sum of money they are prepared to spend is insufficient, they go elsewhere. We were vindicated once, when such a client ended up with a fully documented project far beyond her budget and, as it happens, squarely within the range we suggested many months prior. We might have been vindicated but we still didn’t win back the project.

We now practice a more gentle method of financial management, one that lacks none of the honesty of our old approach but adds considerable value to your decision to engage an architect. The idea is simple:

we do not design

Bear with us for a moment while we explain.

As architects, we are more than mere technicians. We are part scientist and part artist, a design professional whose aim is to not just meet your needs, but exceed them. We take your 1,300 word project brief, with all its disparate and sometimes competitive requirements, and distil it into something whole, something unexpected, something that delights.

We use smart design, multifunctional spaces and sensitive retooling of existing rooms to increase the effectiveness of your brief without compromising its aspirations. In other words, we make your house smaller. Our best outcome so far was a 280sqm brief we distilled down to 170sqm. Most telling is the reaction of our clients, whom upon presentation of the resultant design at no point said, Oh, we really wanted something bigger.

Let us elaborate further.

In today’s construction market, architects generally achieve construction costs somewhere between $2,500 and $4,000/sqm. For a 280sqm brief, providing financial advice in our first meeting would have meant telling our clients they needed to spend $700,000 to $1,120,000. Since our clients’ budget was $330,000, this conversation would not have ended well. Instead, after our preliminary design work, we were able to tell our clients they needed to spend $425,000 to $680,000. Still well over budget, but now attached to two important pieces of information:

  1. This range is a realistic reflection of the project cost, no longer an arbitrary figure, so can now be reliably manipulated according to finishing requirements.
  2. Thanks to our design input, the range represents a 40% reduction off the cost of the initial brief.

There still remained a challenging discussion ahead, one that needed to reconcile the $95,000 gap between our clients’ budget and the bottom end of the cost range. However, our clients were now armed with a realistic assessment of costs and the benefits of a design process that had already saved them considerably. Ultimately, the brief was reduced and the budget was expanded to meet somewhere in the middle, the most common solution to this scenario.

Our gentle approach was, and remains, to turn your budget into a realistic project cost only once we’ve successfully reduced your project’s scope but long before you’re financially committed to it.

Sadly, there is an urban myth that architects inflate the cost of building projects. While there is certainly a sticky history of some architects avoiding budget management for fear of losing projects, by and large this is not true. First, we do not set construction prices. The construction industry, driven by supply, demand and ever-increasing labour costs, does. Second, what we do do is act as a messenger, often getting shot simply for communicating to you that your project already cost more than you expected, you just didn’t know it yet.

As our clients, you need to appreciate that wishing your project to cost a certain amount does not make it so. You also need to understand that a flippant, Oh, let’s go ahead and add that third bathroom, does not cost nothing. And as your architects, we need to guide you through the challenging process of aligning your budget and your brief, even if it means delivering unpopular news and risk getting shot.

Yours sincerely,
Panfilocastaldi.

6 thoughts on “Why your budget is not your brief

Add yours

  1. Great article Warwick.
    I think there are a couple of things at play here:

    Clients can give false budgets trying to compensate for the fact that the architect will inflate the price (supposedly). When you’re looking for a car you wouldn’t tell the dealer your final price would you?

    Also, the general perception to the public of the cost of residential construction is driven by volume built houses, as that’s the information that’s most readily accessible. The perception is that the architect designed home costs “a bit more than this” but there is actually a vast gap. There is very little out there that gets built in that in-between area between “project” houses and “architectural” houses, which are two very separate and distinct products.

    There are of course several reasons for this.

    The project home industry is a very well oiled machine, where every component has been refined to suit mass production and mass availability. Every design decision an architect makes that deviates the house from suiting that model means a price increase. By the end of the project the architecturally designed home has little in common with the project home, hence the cost gap is vast. Perhaps there is room in the market for something in-between.

    Also Architects give a very high level of service. Every project is essentially a unique product, completely tailored to the client’s needs. Every project home is essentially the same product, and the client tailors themselves to fit in the house by choosing a facade and which laminate goes on the benchtop. Again, there is perhaps room in the market for something in between.

    I think a lot of Architects don’t want to tread in this middle ground between low cost “project home” and high cost “architectural home” for fear of blurring the boundary between the two, therefore being labelled as one thing or another. I for one am interested in this middle ground as a way of Architects having more widespread relevance and perhaps moving away from being a niche service for residential projects.

    1. Thanks for your comments, Kelami.

      In our practice, we are still faced every now and again with a potential client who’s comparing our services to a volume builder. As you say, it’s an almost impossible contest to win if the client is only interested in the financial bottom line. For what it’s worth though, the volume builders generally quote unachievable construction rates to win business. According to a quantity surveyor with whom we work, they might quote $1,500 /sqm to get people in the door, but their build prices inevitably push the $2,000 barrier.

      As for how architects typically work, squarely within the bespoke realm, take a look at our previous article here. Scroll down for my Analogy of the suit.

      Do you have any plans how you might attack the middle ground – the high quality, off-the-rack suit as I’ve called it?

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