Building consents and tenders

But it still pays to understand what you can and can’t do.

Building consents

A building consent makes sure you’re knocking together something that won’t topple over or leak – it ensures your plans conform to the Building Code. Consents are administered by your local council, and you’ll need one to provide proof your design is up to scratch.

If council isn’t satisfied, your application will be rejected and your reno will be dead in the water until you can prove otherwise.

What you’ll need

Your best bet is to leave the applications to your designer or builder, they’ve seen it all before and know the process. At the very least you’ll need to provide four separate things to the council:

• Proof of ownership: We’re not sure why you would renovate otherwise, but you need to prove you own the place.
• Detailed drawings: The initial sketch plans won’t have enough information for the council to give it the “yay” or “nay”.
• Specifications of material or building systems: You need the nitty gritty details of the things getting installed, these specs might be included in the final drawings from your designer.
• Memorandum from licensed building practitioner: This lengthy form identifies what work is restricted building work, a description of it, who’s doing it, and links it back to the plans and specifications.

That’s the bare bones. On top of that, there might be extra requirements based on the type of work you’re proposing. These might be calculations to show the building will cope with the proposed changes, or if it’ll stay standing if you’re in a specific high wind zone.

Do you even need it?

If your reno doesn’t involve any restricted building work, you might not need to go down this track. Things like ripping out the old kitchen and replacing it like for like with a new one should sail through. New regulations came into effect last year that reduced the scope of what work needs building consents.

There’s an online resource (buildit.govt.nz) that can show you if your project will need one.

What definitely needs it?

If your job is major and structural, go in assuming you’ll need to apply for a building consent. A new woodburner seems innocuous, but it’ll be subject to the consent process. Same goes for a fancy tiled shower rather than a plug-and-play unit you buy from a plumbing supplier. Plumbing and drainage changes can sneak through, but installing an additional bathroom or toilet will put you over the line.

It’s a pricey business

You’ll get charged a fee based on the total cost of the project. These fees tend to run into the thousands for big projects. Be sure to budget for it at the beginning of your job.

Once issued, a building consent is valid for 12 months, but you can apply for an extension. If you don’t apply for it, the consent will be reneged and you’ll start the process again. You have two years to complete the job from the date of issue.

Can you do that?

Your council has rules in place to stop you constructing things on your property willy-nilly.

District plan

The district plan contains all the rules you need to comply with. They cover what you can use your home for, through to size and shape of any buildings. If your design breaks them, your reno could be scuppered. However, you can still apply for resource consent and if approved, things will look rosy again.

It’s easy to look up your district plan online. Type “[your local council] district plan” into a search engine and it’ll bring up a link that’s relevant to you. Most have an interactive map that’s colour coded so you can see how your property is zoned. If you live in the suburbs, it’s likely “residential”. From there you can look up the rules for that property type in the plan.

What’s in the plan?

The rules all depend on your council and the zoning of your property. There are some common threads across councils. These include:

• Site coverage: Just because you own the section doesn’t mean you can cover the whole thing with a giant house. There’ll be a maximum percentage of ground that your dwelling can cover. This could impact the size of an extension.
• Special trees: While that pōhutukawa might block your view, be sure to check you can knock it over to extend the deck. Some native trees are protected while others are marked as notable, or heritage, and you won’t be able to touch them.
• Building height: The overall height will be restricted. There’ll also be a restriction known as a “recession plane”. This is an angle from your boundary you can’t build above. That means you can’t build a high-rise right on the edge of your land and block your neighbours’ sun.

• Closeness to boundary: At the front, sides and back of your property, there’ll be rules to stop you from building too close to the boundary. Often the front of the property needs to be further back from the road, but the sides of the house can extend a bit closer to the edges.
• Permeable surfaces: A good portion of the property surface should be permeable, which means there’s suitable drainage on site and rainwater doesn’t run into the stormwater drains. The percentage required will be clearly marked out. So, your reno plans can’t include a total lawn replacement with a concrete slab.
• Heritage buildings: Some areas or buildings may be deemed historically important and will have restrictions to the work you can do to them. That might impact your grand plans. Restoration work can be intricate and expensive to undertake too.

Permitted Boundary Activity

If your design oversteps the rules by getting too close to the boundaries or is outside the recession plane, you can try to get it over the line by applying for a Permitted Boundary Activity. Often, you’ll need to get approval from your affected neighbours, which isn’t guaranteed – it might negatively impact their investment after all.

If you find yourself on the wrong side of some of the other rules in the District Plan, you’ll need to apply for a resource consent. If you don’t, you’ll be building an illegal structure and can face criminal prosecution when you’re caught out.

Your easiest route is to stay within the rules. It’s a good idea to peruse these restrictions so you can temper your plans before you even contact a designer in the first place.

Waiting time

Most councils aim up to 20 working days to turn around your consent applications (should everything be OK). If there’s a bit of go-between to sort out any required information, it’ll take longer.

Pricing the job

If you haven’t already done so, now’s the time to think about getting an estimate from a quantity surveyor (QS), someone who’s trained in construction methods and costs. They will go through your designer’s drawings to itemise and cost the quantity and quality of the materials and labour needed. You probably wouldn’t go down this route with a small job like a new bathroom, but it starts making sense for larger jobs that cost an absolute bomb.

A QS is very useful because:

• You can scale back your project now if it’s over budget.
• When the contractors’ tender bids come in, you have a better idea of what’s too high or too low (be suspicious of either).
• If you end up with only one tender, you can compare it against QS’s estimate to determine if it’s reasonable or not.
• If you’re managing the project yourself and aren’t sure what’s a fair price.
• Contractors can use the QS’s assessment of building material quantities when compiling their tenders – remember to give them only the quantities, not the price.

To find a QS, if your designer doesn’t suggest one, go to the New Zealand Institute of Quantity Surveyors website (nziqs.co.nz).

Costs

The cost of your build depends somewhat on your taste and style – if you’re a person who likes top quality, your renovation will cost more. Fittings and fixtures are often chosen later so the true cost may not be reflected in your estimates and quotes. Your estimate will include a “prime cost sum” for such things – light fittings and door handles, sinks and taps, for example – but you may need to pay extra if what catches your eye is more than the sum allowed.

Inviting tenders

Ideally invite at least three builders to tender for the job, letting them know you have asked others. That’s for fairness and transparency, but also means you may get a more competitive quote.

Let them know you won’t necessarily opt for the cheapest. You’ll also consider their reputation, qualifications and work quality (and mean it – it’s rare that the cheapest is the best).

Information to pack into your tender pack includes:

• detailed drawings and specifications outlining the extent of the work
• materials required
• construction details
• location of the building site (and any anticipated difficulties, such as access issues)
• position of the house on the site
• QS' estimates for the quantity of materials, if you have them
• type of building contract the work is to be under:
  • full, where they buy the materials and supply the labour
  • labour-only, where you buy the materials and they supply the labour
  • managed labour-only, where you buy the materials and supply the labour, under the contractor’s direction.

Give as much information in the tender documents as possible. That means the received quotes will be more reliable, with less chance of dispute if the actual costs are higher than the contractor thought due to an information deficit.

The tender bids you receive should include:

• exact costings (including GST) for all the materials and fittings (allowing for prime sum costs)
• exact costings for the labour of the builders and subcontractors (if you asked for that)
• any other details you asked for, including the builder’s hourly rate for any extra work.

It’s likely your bidding builders will be tendering for other jobs, too. If they win another tender, they should tell you and pull out, or ask if you’ll wait until they are free.

Want to use your favourite builder?

Many of us have a builder we’ve worked with happily before, or have heard is truly excellent, so you might want to bypass the tender process. If so, still give them this information and ask for a detailed written quote.

Estimates vs quotes

Estimates and quotes are very different things:

• An estimate is only a best guess at what the job will cost and the builder isn’t bound by it – it is, however, reasonable to expect it to be within 10 to 15 percent of the final cost.
• A quote is an explicit promise based on detailed specifications and is the price you will pay – unless there are matters outside the builder’s reasonable control, or the cost of materials or labour increases (even then, only if that’s allowed in your contract) or other variations.

Other considerations around estimates and quotes:

• They should both be in writing, signed and dated.
• Be careful of provisional sums included in a quote, where the price of something is uncertain – these are often underestimated, so ask if the amount quoted will cover what you’re expecting.
• Be wary of low tender prices compared to others. If you think they’ve misunderstood the project, go back and clarify.
• Never use one quote as leverage to beat down another’s price. That’s unfair and could compromise on work quality.
• Put a premium on experience and reliability over price on its own – a more experienced builder is likely to cost more, but can pay off in the long run.

Guaranteed maximum price

A guaranteed maximum price (GMP) is where the builder guarantees a top price in the contract.

A GMP has its pros and cons:

• They work well as an incentive to the builder to finish on time and within the budget.
• You avoid the risk of uncontrolled extra costs and time.
• However, you pay a premium because the contractor will factor the risk of delays and extra costs into their price.
• Any variations you ask for will be outside the GMP, so you will pay more.

What if the build comes in under the GMP?

Any savings during construction are generally shared between you and the builder, with the ratio specified in the contract. This gives both you and the builder an incentive to co-operate as you will both wanting to avoid overrunning the GMP.

A reality check on cost

As good as a QS’s estimate might be, in addition to your designer’s experience, it’s only when the tenders come in that you can see how much your much-desired project will cost.

Chances are you’ll have to revise your plans (yes, yet again) or increase your mortgage to match.

If that happens, go back to your designer and the QS and ask if they can point to areas that could have blown out the cost. Because the cost of building fluctuates, and getting a building project nailed down takes time, a lot of time can pass between the estimates being calculated and tenders being received.

So, see what can be scaled back or altered to suit your budget. If you’ve already lodged your application for a building consent, any major changes to the plans mean you’ll have to either put in a new application – with a new set of documents – or ask for an amendment.

Saying no

Once you’ve decided which bid to accept, it’s the done thing to write to the other tenderers to tell them they were unsuccessful. Tendering is a part of their business, but it takes time and effort. Also, they may be waiting for your response before making other decisions, so let them know as soon as possible.

Home renovation guide

• Step 1: Before you start your reno
• Step 2: Designing the plans
• Step 3: Choosing tradies and builders
• Step 4: Building consents and tenders
• Step 5: Renovation finance and insurance
• Step 6: The building process
• Step 7: Building disputes
• Step 8: Finishing your renovation