Most homeowners think their renovation starts when they sign the building contract. In reality, the work starts much earlier. What happens before you sign that contract can have a big impact on your project, from the design and budget through to the build itself.
Every so often, someone comes to us with a finished set of plans and a problem they didn’t see coming.
They’ve done what they thought they were supposed to do. They found a draftsperson, architect or building designer, spent months working through their renovation or extension, went back and forth on the plans and finally got to a design they really love. They’ve paid for the plans too, so it feels like the hard part is done. Now they just need to find someone to build it.
Then the price comes back. And it’s nowhere near what they expected.
Sometimes it’s a little over budget. Other times, the difference can be $100,000 or more. At that point, they may have to make major changes to the design or go back to the drawing board.
This happens more often than you might think. It doesn’t necessarily mean the plans are wrong. The problem is that the design hasn’t been properly checked against a realistic building budget while there was still time to make changes.
So when should you check?
Not after the plans are finished. And not when the quotes come back and you’re left trying to work out where everything went wrong. The conversation needs to happen much earlier, during a stage of the process that many homeowners don’t even realise exists.
The Contract Isn't Where the Project Starts
Most people think a renovation starts when they sign a building contract. That's the moment that feels real. There's a document, a start date and a deposit. But by then, most of the decisions that affect the project have already been made. The size of the renovation, the design, the scope of work and, most importantly, the budget.
The contract isn't really where the project starts. It's closer to where the risky part should be finished.
A lot of the problems we see come down to one thing: the order things happen in. Before you can build, you need plans. Before you have plans, you usually need someone to draw them. That might be an architect, draftsperson or building designer. Most homeowners wouldn't know the difference between the three, or which one is right for their project. Then there's engineering, energy assessments, council approval and a long list of other details that need to come together.
And underneath all of it is the question that should be asked much earlier: Can you actually build what you want for the money you have?
That's the question that catches people out. Not because they're careless. Most people simply haven't been told to ask it early enough.
What Should Happen Instead?
Let's say a client wants to add 200 square metres to their home and has $500,000 to spend. A builder who's involved early shouldn't just nod and start drawing. They should have an honest conversation. If the builder knows that a 200 square metre extension isn't likely to fit within $500,000, they should say so. That might mean increasing the budget, or it might mean changing the design.
It's not always the conversation you want to have on day one. But it's a much better conversation to have then than after you've spent months paying for plans.
Skip that step and the cost isn't only financial. There are the design fees, months spent going back and forth on drawings, engineering and other consultant fees. Sometimes the documents from different consultants don't even line up properly. Then there's something harder to put a dollar value on: momentum.
People don't usually wake up one morning and decide they've given up on their renovation. The project just starts to feel too hard. The plans sit in a drawer, the calls stop and the project gets put off. Eventually, it doesn't happen.
That's the part people don't always think about when they talk about getting the budget wrong. It's not just the extra money. It's the time, energy and motivation that can disappear along with it.
So What Does a Preliminary Agreement Actually Do?
This early stage usually happens in two parts, even though different builders may call it different things.
The first part is about turning an idea into something you can properly test. A builder visits the existing home, takes measurements and photographs, and talks through what you actually want to achieve. Not just how you want the house to look, but how you want to live in it.
From there, concept plans can be developed. Sometimes there are a couple of options to consider. The important part is that the design is checked against your budget while you're still able to change it. Once you've settled on the preferred option, the design can be developed further into a costing set of plans. At that point, you have a much clearer idea of what you're working towards and what it is likely to cost.
The second part is about getting the project ready for construction. This can include council submissions, engineering, energy assessments and construction drawings. It's less exciting than choosing your kitchen or looking at tiles, but it needs to happen. Getting these things done in the right order can save you from having to go backwards later.
Isn't That Just Another Fee?
This is one of the first questions homeowners often have, and it makes sense. Why pay for another stage before you've even signed a building contract?
The thing is, these costs don't disappear if you skip the preliminary stage. Someone still needs to draw the plans, someone still needs to do the engineering, someone still needs to deal with approvals, and someone still needs to work out what the project is going to cost.
The question is really about when you deal with those costs. You can see them clearly at the start, or they can turn up one by one over the following months. Neither option makes the work free. The difference is how clearly you can see what you're committing to.
Do I Need Finished Plans Before I Talk to a Builder?
This is another common assumption. People sometimes think they need to have everything worked out before they approach a builder.
If you're talking to a builder who only builds, that can make sense. They need a finished design to price the work. But a builder who works through design and construction can be involved much earlier, and that's actually where they can add the most value.
They can look at the design while it's still flexible. If something is likely to cost more than expected, you can talk about it before you've spent thousands getting the final plans finished. That gives you a chance to change the design once, rather than paying to redesign it later.
You're Not Locked In
There's another important part of a preliminary agreement. It isn't a building contract, so you're not committing to build the whole project just because you've started working with a builder. You're paying for a defined stage of work.
If you decide we’re not the right builder for you, that’s okay. Just let us know.
By this stage, we’ve usually spent a few months working closely together, so we’ll have a good feel for whether we’re the right fit for each other too. If we feel the same way, we’ll be honest about that and, where appropriate, help you move forward with another builder.
It’s better to have that conversation early than to push ahead when it doesn’t feel right for either of us.
The Order Matters
If there's one thing worth taking from all of this, it's that the order matters. Find your builder early. Don't wait until the plans are finished and the budget has already been set in stone. Get the builder involved while there is still room to make changes.
And when a builder or engineer tells you something is going to cost more than you hoped, listen to them. They're not necessarily trying to make the project more expensive. They may have simply seen the same situation before.
The other thing worth remembering is that the number in your head is usually the starting point, not the ceiling. Building costs can change, designs can change and the scope of a project can change. Leaving some room in your budget from the beginning is a lot easier than finding the money later.
Where Does the Preliminary Agreement Fit In?
This brings us back to the original point. The building contract isn't really the start of a renovation. By the time you get there, the design, budget and scope should already have been worked through.
The important work happens before that. It's the sketch becoming a plan, the plan being checked against a real budget, the engineering and approvals, and making sure everything lines up before you're ready to build. That's where a renovation can either start to come together or start to fall apart.
At ZJ Building, this is what our Preliminary Building Agreement is designed to help with. Stage 1 of our Preliminary Building Agreement turns your brief into concept plans and a budget estimate. At the time of writing this blog, we charge $9,900 including GST for a typical single-storey extension or renovation on a standard Adelaide block.
Stage 2 of our Preliminary Building Agreement takes the approved design through council approval, engineering, interior design and construction drawings, getting everything ready to build. This usually costs between $30,000 and $60,000, depending on the scope of your project.
These prices are current as of August 2026 and may change over time, so they are a starting point for a conversation rather than a quote.
If you're thinking about extending or renovating and want to understand what the process could look like for your home, book a discovery call with our team. It's a good conversation to have before anyone starts signing contracts.
