Who Would Chose to Be a builder?

Current challenges faced by builders.

 

Running a building company is not for the faint hearted.

 

For the last three years small businesses have been in survival mode and things don’t look like improving dramatically any time soon.

 

DDB Design has weathered the storm but is now half the size it was back in 2019. It’s been tough to watch the company I have built over the last 30+ years struggle to stay afloat due to circumstances out of my control.

 

Now that the pandemic is mostly behind us and workflow and the economy are a bit more predictable, I would like to outline the top five challenges impacting residential builders and what DDB Design is doing to mitigate each of these challenges.

 

1. Constantly changing Building Regulations.

The building regulations in Australia are currently undergoing enormous changes. Building regs have always been state based and are slightly different in each state. However, on the 1^st May 2023 all states will adopt the uniform “National Construction Code” (the NCC).

 

A second round of new NCC regulations will then be introduced on 1^st October 2023.

 

Just reading the NCC is an enormous exercise let alone implementing all the changes and educating your employees and contractors. My approach is to closely follow the Master Builders Association of Victoria (MBAV’s) weekly blog and press releases, The MBAV is doing an excellent job of summarizing the regulation changes and spelling out what builders need to know to stay ahead of the NCC introduction.

 

1. Local Councils.

This one challenge alone is enough to discourage any sane person from becoming a builder.

 

There are 31 local councils in Melbourne and 79 in the state of Victoria. Every council has different town planning and building regulations. Some councils seem to make it as difficult for builders as possible and they are constantly moving the goal posts.

 

A recent example at Stonnington Council; overnight they changed the public liability insurance required for a specific type of building permit from $10 million to $20 million. So, I had to double my P.L. insurance just to satisfy Stonnington’s ridiculous “red tape”.

 

I have found that the only way to cut through all the council red tape is through tenacity, nailing the information & details and by over communicating. Which takes up a lot of time and energy!

 

1. Occupational Health & Safety (OH&S).

Building sites are dangerous places to work and there is a high level of responsibility on the builder to ensure everyone remains safe and healthy. This requires a lot of knowledge, resources, and commitment from the builder. But even if a builder takes OH&S very seriously and nails all the on-site execution perfectly, accidents can still happen, a tradesman ends up slipping up eventually. The ramifications of a one-off accident can be business destroying for the builder.

 

Five years ago, whilst building a new DDB home in Caulfield North, an apprentice carpenter (employed by the framing sub-contractor) fell off a ladder and broke his hip, his arm and ruptured his spleen. Following a full investigation by Worksafe the person direct responsibility for this accident was found to be the apprentice’s employer. However, as the registered builder, I was also held partially responsible. This one-off accident has cost DDB a significant amount of legal costs and has made obtaining liability insurance extremely difficult and expensive for several years.

 

My approach to OH&S has always been to “manage by walking around” the building site each day and by including all my employees in the OH&S conversation and the decision-making process.

 

Ultimately each person on site is responsible for their own safety and must be fully aware of what they are doing and everything that is going on around them. (See # 177)

DDB’s golden rule for safety is.

“If it feels or looks dangerous, don’t do it.”

 

1. Protection works agreements.

One of the most challenging parts of obtaining a building permit, is the “protection works agreement” with the adjoining neighbours.

 

If the proposed building work could have any adverse impact on the neighbouring properties, the Building Surveyor will require the builder to organise a “protection works agreement” with the owner of adjoining property.

 

This process is fairly straight forward, however the rules and regulations are stacked firmly in favour of the neighbour and if they disagree with or don’t understand the proposed building work, they have the power to delay the project and rack-up significant additional cost for my client.

 

It's not uncommon for neighbours to have disagreements, but these petty disputes can become a big problem if one of the owners wants to do a building project and requires the neighbours approval. The builder can get caught in the middle of a drawn-out dispute that’s out of their control.

 

My approach to protection agreements has always been to start communicating with the adjoining neighbours as early as possible and to over deliver with the information that needs to be supplied.

I also organise a professional “Dilapidation Survey” for the neighbouring properties and try to make the agreement process as easy and painless as possible for both my clients and their neighbours. But this doesn’t always work out as planned and we end up riding out the negotiations for as long as it takes.

 

1. Client’s Expectations.

DDB houses are a huge financial and emotional commitment for our clients, and they all have specific expectations for the design and building process as well as the final outcome. Some clients are very open and freely express their expectations, but others are far more guarded and only reveal their fears and assumptions when they are stressed or something goes wrong.

 

Anticipating and managing the client’s expectations is a vital part of successful project management and is a prerequisite for having a good relationship with the clients and achieving a successful final outcome.

 

Getting to know the clients and their families during the design & documentation process allows me to understand their specific requirements and their expectations well before we start the building process. For a year or so the DDB Team becomes part of the client’s family which enables building their home to be a fulfilling and enjoyable process for everyone involved.

 

Building or renovating a home is a very complex and challenging exercise for both the builder and the client. As previously outlined (see # 141) it will never be “an exact science” and I am grateful for this, because personally I love the challenge.

 

Thanks for reading,

Stay safe and lean into the challenge.

David

Who Would Chose to Be a Builder?

Current challenges faced by builders.

 

Running a building company is not for the faint hearted.

 

For the last three years small businesses have been in survival mode and things don’t look like improving dramatically any time soon.

 

DDB Design has weathered the storm but is now half the size it was back in 2019. It’s been tough to watch the company I have built over the last 30+ years struggle to stay afloat due to circumstances out of my control.

 

Now that the pandemic is mostly behind us and workflow and the economy are a bit more predictable, I would like to outline the top five challenges impacting residential builders and what DDB Design is doing to mitigate each of these challenges.

 

1. Constantly changing Building Regulations.

The building regulations in Australia are currently undergoing enormous changes. Building regs have always been state based and are slightly different in each state. However, on the 1^st May 2023 all states will adopt the uniform “National Construction Code” (the NCC).

 

A second round of new NCC regulations will then be introduced on 1^st October 2023.

 

Just reading the NCC is an enormous exercise let alone implementing all the changes and educating your employees and contractors. My approach is to closely follow the Master Builders Association of Victoria (MBAV’s) weekly blog and press releases, The MBAV is doing an excellent job of summarizing the regulation changes and spelling out what builders need to know to stay ahead of the NCC introduction.

 

1. Local Councils.

This one challenge alone is enough to discourage any sane person from becoming a builder.

 

There are 31 local councils in Melbourne and 79 in the state of Victoria. Every council has different town planning and building regulations. Some councils seem to make it as difficult for builders as possible and they are constantly moving the goal posts.

 

A recent example at Stonnington Council; overnight they changed the public liability insurance required for a specific type of building permit from $10 million to $20 million. So, I had to double my P.L. insurance just to satisfy Stonnington’s ridiculous “red tape”.

 

I have found that the only way to cut through all the council red tape is through tenacity, nailing the information & details and by over communicating. Which takes up a lot of time and energy!

 

1. Occupational Health & Safety (OH&S).

Building sites are dangerous places to work and there is a high level of responsibility on the builder to ensure everyone remains safe and healthy. This requires a lot of knowledge, resources, and commitment from the builder. But even if a builder takes OH&S very seriously and nails all the on-site execution perfectly, accidents can still happen, a tradesman ends up slipping up eventually. The ramifications of a one-off accident can be business destroying for the builder.

 

Five years ago, whilst building a new DDB home in Caulfield North, an apprentice carpenter (employed by the framing sub-contractor) fell off a ladder and broke his hip, his arm and ruptured his spleen. Following a full investigation by Worksafe the person direct responsibility for this accident was found to be the apprentice’s employer. However, as the registered builder, I was also held partially responsible. This one-off accident has cost DDB a significant amount of legal costs and has made obtaining liability insurance extremely difficult and expensive for several years.

 

My approach to OH&S has always been to “manage by walking around” the building site each day and by including all my employees in the OH&S conversation and the decision making process.

 

Ultimately each person on site is responsible for their own safety and must be fully aware of what they are doing and everything that is going on around them. (See # 177)

DDB’s golden rule for safety is.

“If it feels or looks dangerous, don’t do it.”

 

1. Protection works agreements.

One of the most challenging parts of obtaining a building permit, is the “protection works agreement” with the adjoining neighbours.

 

If the proposed building work could have any adverse impact on the neighbouring properties, the Building Surveyor will require the builder to organise a “protection works agreement” with the owner of adjoining property.

 

This process is fairly straight forward, however the rules and regulations are stacked firmly in favour of the neighbour and if they disagree with or don’t understand the proposed building work, they have the power to delay the project and rack-up significant additional cost for my client.

 

It's not uncommon for neighbours to have disagreements, but these petty disputes can become a big problem if one of the owners wants to do a building project and requires the neighbours approval. The builder can get caught in the middle of a drawn-out dispute that’s out of their control.

 

My approach to protection agreements has always been to start communicating with the adjoining neighbours as early as possible and to over deliver with the information that needs to be supplied.

I also organise a professional “Dilapidation Survey” for the neighbouring properties and try to make the agreement process as easy and painless as possible for both my clients and their neighbours. But this doesn’t always work out as planned and we end up riding out the negotiations for as long as it takes.

 

1. Client’s Expectations.

DDB houses are a huge financial and emotional commitment for our clients, and they all have specific expectations for the design and building process as well as the final outcome. Some clients are very open and freely express their expectations, but others are far more guarded and only reveal their fears and assumptions when they are stressed or something goes wrong.

 

Anticipating and managing the client’s expectations is a vital part of successful project management and is a prerequisite for having a good relationship with the clients and achieving a successful final outcome.

 

Getting to know the clients and their families during the design & documentation process allows me to understand their specific requirements and their expectations well before we start the building process. For a year or so the DDB Team becomes part of the client’s family which enables building their home to be a fulfilling and enjoyable process for everyone involved.

 

Building or renovating a home is a very complex and challenging exercise for both the builder and the client. As previously outlined (see # 141) it will never be “an exact science” and I am grateful for this, because personally I love the challenge.

 

Thanks for reading,

Stay safe and lean into the challenge.

David