BUILDING JARGON: WHAT DOES IT ALL MEAN?

See omnystudio.com/listener for privacy information.

Episode Transcript

Speaker 1 (00:00):
You sure, ken, Ken. We've spoken on the show before
about real estate jargon. That's you know, terms that real
estate agents sort of throw out, their fancy terms.

Speaker 2 (00:09):
I think when we started this show, like almost eight
years ago, one of the things that we said both
together we said, any real estate agent or anyone on
the show says a word or something that we don't understand,
we're going to say, stop, what does that mean?

Speaker 1 (00:24):
But then we would spend too long. We wouldn't even
get we wouldn't we wouldn't even get to talk about
what we originally were meant to speak to them about.
We just need to do the ding acting every time
they do it, we'll get a belt. But this morning,
we're going to look more into building jargons. So if
like you're building a house, for example, you hear builders
or you know, architects, designers, whatever, having conversations with each

(00:45):
other or even with you, and they'll say things and
you'd be like, hey, what, I don't know what that means?

Speaker 2 (00:49):
So you go like that exactly.

Speaker 1 (00:52):
So we're going to learn a bit more about building
jargon this morning and sake morning to Adam Hoble, Principal
building designer at Adam Hoble Design and author of the
book Nail It Adam. Good morning, Good morning guys, how
I am good? Now building jargon, let's start off with
this example. When we hear someone talking about an allowance,
what does that mean?

Speaker 3 (01:12):
Yeah, so look, we when we put a project out
to quote with builders, there's always going to be a
whole bunch of things that haven't yet been selected. You
haven't yet actually selected drrathern or you're you're a tiler
or a timber flooring for example. So these things, when
when they're quoted, there's a dollar figure, a dollar allowance,
it's made to kind of make sure that those things

(01:34):
are captured in the quote.

Speaker 2 (01:35):
Right, okay, okay, And so that means sort of budgets
don't then although I suppose they can, they don't blow out?
Is that essentially what we're looking to do.

Speaker 3 (01:43):
Well, that's the catch I guess into understanding those allowances
as to how realistic and how accurate they are. So
that's a real trap where where an allowance, for example,
for something like site cuts excavation on a steeper side,
if a builder's got let's say, you know, two thousand
dollars in there for site cut more likely that could

(02:05):
be fifteen or twenty thousand dollars and ultimately you end
up paying the difference. So really important that you understand
those numbers are realistic.

Speaker 2 (02:12):
Okay, so we talked about allowance, then is that then
the same as a provisional sum or a prime cost item.

Speaker 3 (02:20):
Yes, it is so. Provisional sums and prime costs are
both forms of allowances in a quote and a building contract.
The difference between those is the provisional sum for tasks
that include both labor and the supply of materials. So
an example there would be kitchen where there's a whole

(02:41):
of cabinetry material, board, benchtop that needs to be purchased
and selections made, but also a whole lot of labor
to put that kitchen together. A prime cost, again with
the example of a kitchen, is the things that are
the items that you are kind of selecting the going
into the kitchen, so things like the tap, the sink,

(03:03):
and the appliance. So less about the labor component, more
about just the supply cost of that item.

Speaker 1 (03:08):
Yeah, okay, gotcha. And is there another word or turn
a phrase that comes to mind for you, Adam, that
has a lot of people you know, scratching their heads
when builders and designers are talking.

Speaker 2 (03:17):
Yeah, like when you show up to the job site
and someone says a word and you go, what are
you talking about? Mane?

Speaker 3 (03:22):
Yeah, well, look, I mean I think early on in
the process, and sticking with the theme of the I
read this is kind of quoting process. A lot of
people are really surprised that they think there's a whole
lot of safety in signing a fixed price contract building
contract with a builder, And yes there is, but it's
very rare that a fixed price contract is truly a

(03:45):
fixed price contract. So again we come back to those
allowances that we spoke about provisional sums and prime costs.
Anytime that you've got a provisional sum in a quote
and a building contract, it's not truly it's not truly
a fixed price contract. So it's really important to understand
that those numbers are realistic and accurate, otherwise you're interest

(04:06):
for the nasty surprise.

Speaker 2 (04:07):
I believe when you see the words provisional sum, you
must highlight that and just go got to be careful.

Speaker 3 (04:13):
Yeah, absolutely, that's right. I mean, we spend a lot
of time with our clients working through that process. That
quoting process, to make sure that they have a really
high degree of understanding of what the quote includes and
what an excludes, and to make sure it's realistic with
their expectations.

Speaker 1 (04:30):
Yeah, absolutely all right, and well, thank you so much
for shedding light on that us. We've learned something this morning.
Thanks so much.

Speaker 3 (04:36):
Thank you guys, have great weekend you too.

Speaker 1 (04:38):
Adam Hoble, our principal building designer, Adam Hoble Design