A couple in Figtree sat at my kitchen table a while back with two new-home quotes printed out, a decent gap between the totals, and asked me which builder was cheaper.
Took about twenty minutes to work out that neither of them was. One had a tiling allowance that would have covered floor tiles in the wet areas and nothing else. The other had priced tiles to the ceiling in both bathrooms and included the driveway. The cheaper quote was the more expensive house. They'd have found that out about eight months in, one selection at a time, which is the worst possible way to find it out.
The number on the front page of a new-home quote is the least interesting part of it. The document that decides what you actually pay is the inclusions list, and almost nobody reads it properly, because it's four pages of product codes and it's boring.
So here's how to read it.
The three things a line item can be, and why the difference matters
Every line on an inclusions list is one of three things, and they behave completely differently once the build starts.
A fixed inclusion is a real product at a real price. Colorbond roof in your chosen colour. A specific brand and model of oven. If it's named with a model number, it's priced, and it doesn't move unless you change it.
A prime cost item, usually written PC, is a product that hasn't been chosen yet but has a dollar figure sitting against it. Tapware, tiles, the kitchen sink, door hardware. The builder has put in a number, you go and select, and you pay the difference between the allowance and what you pick. Nobody ever picks the tapware the allowance was based on. That's not a scam, it's just how selection works: you stand in a showroom, the allowance mixer looks like a rental property and the one two shelves up looks like your house, and you're not going back.
A provisional sum, PS, is work that hasn't been fully scoped. Site costs are the classic one, and I've written about how those behave in site costs on a new build. The point about a provisional sum is that it's an estimate of work, not a price for a product, and it settles at whatever the work actually costs.
Then there's the fourth category, the one that causes the most grief: things that aren't on the list at all.
Where base specs are genuinely thin
A base spec isn't dishonest. It's a starting point, and every builder including us picks a set of standard products that make a decent house. What it isn't is the house you're imagining, because the house you're imagining has been assembled in your head out of display homes and Instagram, both of which are upgraded.
The places I'd look first, in roughly the order they surprise people:
Tiling heights. Floor tiles plus a shower recess to somewhere around door height is a common base. Full-height tiling in the bathrooms is a real cost jump, and more clients take it than any other upgrade.
Everything outside the house. Driveway, paths, letterbox, clothesline, fencing, turf, garden beds, retaining, the concrete pad for the bins. Some builders include the driveway, most don't, and a driveway on a sloping Illawarra block is not a small number. Check whether landscaping is in there at all or whether it's the last line saying "by owner".
Flyscreens and window furnishings. Almost never included. You will want both, on the day you move in.
Ceiling heights and door heights. Standard ceiling height is standard for a reason, and going up costs more than you'd think because it affects windows, doors, framing and plasterboard sheets all at once. Worth deciding early rather than as an upgrade.
The garage. Whether it's a plain slab or finished, whether the door is sectional or a panel lift, whether there's a remote and how many handsets.
Insulation and glazing above the minimum. The energy rating your house is designed to is a floor, not a target. The National Construction Code sets the minimum performance a new dwelling has to meet, and a base spec generally meets it and stops there. On a west-facing Illawarra block, better glazing is one of the few upgrades that pays you back every summer.
None of that means the base spec is bad. It means you should know what you're comparing.
Upgrades don't work the way you'd expect
Here's the mechanic that catches people, and I'd rather say it plainly than have you find out at the selections appointment.
When you upgrade a prime cost item, you don't pay the price difference. You pay the price difference plus the builder's margin on the difference, because the margin sits on the whole contract sum and the contract sum just went up. That's normal and it's in every contract I've ever read, including ours. It's worth knowing because it changes how you budget: a small upgrade isn't quite as small as the price tag in the showroom suggested.
The reverse is worse. If you go below an allowance, the credit you get back is usually the allowance figure less the margin, and some contracts don't credit unused allowances at all. Downgrading rarely saves what you'd hope.
And variations after the contract is signed are priced differently again from the same item chosen before it. Once the plans are lodged and the frame is ordered, moving a window is not a window, it's a redraw, a re-order, and possibly a re-certification. Decisions are cheap on paper and expensive in timber. That's the same reason late changes wreck a schedule, which I've gone through in how long it takes to build a house.
Two quotes, one afternoon, a highlighter
The only reliable way to compare two builders is to put the inclusions lists side by side and go line by line until both documents describe the same house. It's a genuinely tedious afternoon and it's the highest-value thing you'll do in the whole process.
Work through it this way. Take the more detailed of the two lists and use it as the master. Every line on it, find the equivalent on the other one. When there isn't an equivalent, that's not a saving, that's a hole — write the number you'd have to spend to fill it in the margin. When both have the item but one is a PC allowance and the other is a named product, note the allowance figure, because that's a guess and the named product isn't.
By the end you'll have two totals that are actually comparable, and in my experience the ranking flips about half the time.
Ask both builders what a typical client on that spec ends up spending in upgrades. A builder who's been running jobs in the area for years knows that number closely and will tell you. A vague answer is an answer.
There's a broader version of this in how to choose a home builder in NSW, which covers licensing, insurance and the questions worth asking before you get anywhere near a spec sheet.
Standard range doesn't mean one option
A thing worth understanding about the phrase "builder's range" or "standard range": it usually means a selection of products at the allowance price, not a single product. There might be twenty tile options in the standard range and four of them are perfectly good. A decent selections consultant will point you at them. Nobody's obligation is to, so ask.
I've watched people upgrade the kitchen splashback and leave the standard range tile on the laundry floor where it looks completely fine, and I've watched people upgrade everything uniformly because they assumed standard meant bad. Spend the money where you'll touch it or look at it every day. Tapware, the front door, the kitchen benchtop, the flooring in the living areas. Nobody has ever walked into a house and noticed the linen cupboard shelving.
Get the selections done before you sign, if you can
The best version of this process is one where the inclusions list has almost no prime cost items left on it by the time you sign, because you've already been to the showrooms and chosen. Then the contract sum is the contract sum.
That's not always practical, and on a custom job the design is still moving while selections are happening. But the closer you get to it, the less of your build is spent making decisions under time pressure while a trade waits. Where we can, we price real selections into the proposal rather than allowances, because a fixed price built on guesses isn't fixed.
If you want the wider money picture rather than the spec detail, what it costs to build a house in NSW has the ranges and where they come from, and NSW has plain-language guidance on contracts and progress payments at nsw.gov.au that's worth twenty minutes before you sign anything.
We build custom new homes across Wollongong, the Illawarra and the Southern Highlands, and the proposal we hand you spells out the inclusions rather than hiding them behind a headline number — that's how we run new homes. If you've got a quote from someone else and you want a second set of eyes on the inclusions list, send it through the contact page or ring 0434 037 851. Bring both quotes. Bring a highlighter.
Want a hand with this at your place? Get a free quote or call 0434 037 851.