Your builder's price is based on standard allowances for things like tiles, tapware and appliances. Go over them and you pay the difference plus margin. Here's how it works, and how to avoid nasty surprises.
In your contract these allowances usually appear as Prime Cost (PC) items or provisional sums. In Queensland, the QBCC Act requires them to be reasonable estimates, and the contract must show the builder's margin that applies if you spend more.
C20 - What You Should Know When You Design Your New Home
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Last updated 5 Oct 2026 · Revision 1 · Free updates for life
Checklist Type: Minor
Form Factor: Fillable, print-ready PDF (A4, 47 pages)
When to use: Design stage: before the plans and specification are finalised and before you sign
A 372-question guide to work through while designing your home. Settle orientation, light, soil, drainage, layout, finishes and costs early, so you avoid changes and delays later.
What Are Builder's Standard Inclusion Lists?
Builders usually offer standard inclusions at different specification levels. For simplicity, we'll call them bronze, silver and gold. Each step up brings more inclusions and higher allowances, at a higher price.
Types of Specification Levels
Bronze covers the essentials for a functional home, without many frills. It suits a tight budget.
Silver offers a broader range, with better looks, durability and energy efficiency. It balances cost and quality.
Gold has the highest allowances and the biggest range to choose from, including everything in the lower levels.
Owner Supplied Items
If nothing in the standard range suits you, you can remove the item from the contract, take a credit and supply it yourself. That's a valid option, but there are a few things to watch.
First, some builders only credit you the supply cost of the item. The allowance in your contract includes the builder's margin, so your credit should cover both the allowance and the margin built into the house price. If the builder credits only the supply cost, they keep the margin on something they no longer supply. Ask how the credit was worked out.
Second, insurance. Anything the builder orders and supplies is covered by their contract works insurance. Anything you supply isn't, unless you insure it yourself. Theft is common on building sites, and you could end up paying twice.
Third, warranty. Owner-supplied items generally aren't covered by the builder's warranty for the product itself, and if something goes wrong it can turn into finger-pointing between you, the supplier and the installer.
Short supply of owner-supplied materials
Say you supply your own wet area and main floor tiles. Make sure you order enough. Your tiler is booked on your site for a set time before moving to the next job. If you run short, both the tiler and the builder may charge to come back.
NCC Compliant products
When you supply materials, you're responsible for making sure they comply with the National Construction Code (NCC) and Australian Standards. You may be asked for certificates of conformity or technical data showing the product is fit for use. With floor tiles, watch out for "discount" suppliers.
Many discounted tiles are seconds: tiles that may be cupped, warped, twisted or not consistent in size. I strongly recommend against seconds in a new home, especially for main floor tiles. Your tiler can't line up the corners, long runs of tiles look wavy, the floor surface can look uneven, and the tiles may crack or break in normal use.
The Selection Process
Before construction starts, you'll have a pre-construction (colour selection) meeting with the builder to make your selections. Come prepared, because these choices affect the whole project.
Top tip: where you can, finalise your selections before you sign the contract. Every change after signing becomes a variation, with an admin fee and margin on top.
You'll choose across many categories, like roofing, bricks, windows, tapware, door hardware, and paint and finish colours.
Builders often use preferred suppliers, but you'll still have options within your specification level. Your builder will set allowances based on that level, and every upgrade adds to the cost.
Understanding Costs and Credits
If your selections go over the allowances, you'll pay extra through a variation, and builders add a margin on top of the extra cost.
Picking cheaper items can earn you a credit, which can offset some of those extras.
But builders may charge an admin fee for each change, even a downgrade. Each variation takes admin time to price and paperwork to sign, which is why a fee applies even to small changes or credits. Ask about the fee structure upfront.
Finalising the Contract
Once your selections are made, the builder updates the contract documents. Check them carefully and make sure they match what you chose. Raise any differences straight away.
The contract is what binds you and the builder. On site, the builder works from the documents, not from what the sales consultant said. Put any issues to your builder in writing (email), because what you can prove is what counts.
FAQs
Q1. What should I expect during the colour selection meeting?
A1. It's where you make your specification selections: roofing, bricks, windows, tapware, door profiles and handles, paint and finish colours, and more.
Q2. How do builders set the allowances for selections?
A2. Allowances are based on the specification level you've chosen. Ask to see the dollar figure for each one.
Q3. What happens if my selections exceed the allowances?
A3. You'll pay the difference through a variation to your contract, plus the builder's margin (which covers their admin costs) on top.
Q4. Can I get credits for choosing lower-priced items?
A4. Yes, but factor in the builder's admin fee when working out what the credit is really worth.
Q5. Are there admin fees for changing selections, and what do they cover?
A5. Yes. Even if you pick cheaper items, a fee can apply.
Each variation means someone has to identify the change, an estimator prices it, and paperwork is prepared, sent and signed. That's typically 1 to 1.5 hours of labour for a simple variation like a colour change, and more for structural changes that affect multiple items.
