How do designers set their fees?
There are several different methods that design consultants use for charging fees:
- Percentage fees
The designer charges a percentage of the cost of the building on completion.
- Fixed fees
The designer agrees on a fixed sum of money for an agreed scope of work.
- Hourly fees
This is not a common method of charging for designer’s services, particularly for design work on a specific building, as there is no certainty at the outset of how much the fees will amount to.
We usually charge fixed service fees based on the complexity of each project.
How much do designers charge?
The cost of a designer depends on a number of factors, some of which relate to his experience, reputation or method of operation.
A designer who operates a small practice from home office will obviously have lower overheads than a large city practice and may therefore be able to charge less. Hourly rates normally include all normal office overheads such as office rental, administrative staff, printing, telephone calls and so on. Hourly charges could vary from approximately $100 per hour to many hundreds of dollars per hour.
Percentage charges may also vary according to the type and complexity of a job. For example, it is clearly much easier to design a garage than an entire house and it is similarly easier to design a new building on a virgin site than it is to alter and extend an existing dwelling. The more complex the job, the more time the designer will have to spend and therefore the more fees will have to be charged.
Percentage fees for full services (design, documentation and building contract administration) on very small and quite complex projects could be in the order of 20% of the cost of the works and would progressively reduce to around 6% for larger and less complex projects.
Despite our extensive experience, we are able to charge at the lower end of the industry standard due to our low overheads.
What are the design consulting stages?
As a general guide, there are 6 stages to each full service project. For simple, typically single residential projects, our clients usually engage us for stage 1 and 2 only (schematic and developed design), and organise the rest with their builder in order to save costs. We work closely with our clients during all stages so that they retain full control over the project.
- Schematic design
Once you and your designer have established the basic decisions regarding your requirements and budget, the designer will start work. The drawings will usually be relatively simple. At the end of this stage the general planning and style of the building will be fixed. The drawings may be shown to a builder for preliminary, non-binding indication of ballpark cost.
- Design development
When you have approved the preliminary designs the designer will develop the project in more detail, which may be passed onto other consultants such as structural engineers. The developed drawings will include detailed plans, elevations and sections (as required) and the estimate of cost may be more refined. These drawings may be submitted for development approval.
- Planning/development application
- Contract documentation
If you require the designer to call tenders and administer the building contract, it is necessary to produce very detailed and accurate drawings and specifications. At some point in this stage the designer will also prepare documents or submissions to the relevant authority for building approval.
- Contract tendering and negotiation
- Contract administration
The process of building is relatively lengthy and often complex. The designer’s role is basically to administer the contract (arranging the contract, certifying payments to the builder as well as issuing any variations and so on) and to inspect the works so that they are built in accordance with the documents.
What are the costs of the stages?
Typical percentage proportions of our full service fees are:
- Concept/schematic design 15%
- Design development 15%
- Planning application 3%
- Contract documentation 37%
- Tendering and negotiation 5%
- Building contract administration 25%
When do I have to pay the designer?
This is a matter for agreement between you and your designer and should be settled before the designer starts work.
For projects which include stage 1 and 2 only, we charge a 50% deposit at the commencement and 50% balance at completion of our work.
It is usual, where any stage is extended, to claim fees on an instalment basis. Thus during construction it is normal for the designer to claim regular progressive payments of fees. The payment of the fees is not contingent upon a development application or building application being approved as the designer does not have any control over how authorities determine applications.
Are there any other costs involved?
Items outside the design services are charged separately, such as: surveys, specialist consultants (structural engineers, energy consultants, landscape architects), models or artist impressions, statutory application fees, etc.