The Green Dot

How much does an Architect Cost?
How much does an Architect Cost?
Cost and Money
July 31, 2020

For the full service that an architect provides you should allow around 10% to 15% of the construction cost, depending on the size and complexity of the building.

This figure allows for design, obtaining approvals from authorities, documentation for tender and construction, tendering to a number of builders and administration of the building contract during construction. It should also include a limited amount of on site presence and inspections.

This can be reduced pro rata for any services you do not need – like other people, Architects charge for their time and if you request less time spent on your project then the fees will be less. A drafting service can be cheaper because they spend less time on your project. Some building professionals and Draftsmen have training and experience in building design that can be similar to that of an Architect. They charge similar fees. For more questions and answers, please visit Geoff’s page.

Let’s take a deeper look at fees and their relation to our economy. In 2020 we are looking at a country (Australia) where the cost of living and therefore wages are high. In the fourth quarter of 2019, the ABS stated that a full-time adult earns $1,684.00 per week. This equates to around $45 per hour and we assume that this is before tax.

Most Architects have studied at university for five years and with the current education climate where most school leavers partake in a university degree it is hard to tell if this has any impact on the wages of Architects. Looking at Engineering on this article provides a fair comparison.

If we now define the profession of Architect as a ‘Design Consultant’ and look at some methods of charging as a consultant, kindly outlined by Benjamin Harvey in this article we can further understand the likely cost of an Architect.

When looking at the methods in the article above, we would need to consider that there are 52 pay weeks and 46 working weeks. Therefore we need to add 16% to the average wage.

Method 1: Multiply the hourly salary-based wage by a number between 2 or 3. This is inline with a business multiplier between 2 and 3. Using the average weekly earnings above plus 16%, we have a value of $52. This gives an overall commercial rate between $104 and $156 per hour and does not take into account a value assessment on an Architect’s experience, therefore these rates are arguably low for the architectural profession.

Method 2: Calculate a daily rate. For this method, we would divide the average weekly earnings plus 16% by 5. This is a daily rate of $391.

Method 3: Calculate Costing Rates per Project. As previously discussed, an Architect is likely to cost between 10% and 15% of build cost.

Method 4: Charge Market Rates. This is by far the fairest method and it means that the industry flourishes as a whole. If an Architect under-charges, they are devaluing their industry and allowing design to have a lower priority than other aspects of the built environment. If an Architect over-charges, they are also devaluing what the industry can provide on an income per hour rate.

Let us have a look at some build costs for architecturally designed homes. In an article on RealEstate.com.au, Taras Wolf outlines a build cost for architecturally designed homes to start at $3,000 and finish around $5,400. For the purposes of this exercise, let us assume GST is excluded from these costs. These costs are inline with costs outlined by BMT Quantity Surveyors.

Because architectural services are usually more expensive per m² of a smaller project, we will initially be using 15% of $3,000 and 10% of $5,400 as our range. The cost range for architectural services with these definitions is between $450 and $540 per m².

If we now adjust the lower end to 10% of $300 to give a larger variation of scope, we should realistically be allowing at the bare minimum a cost of $300 per m² for architectural services. Using the lower and upper end of the ranges and architectural office would typically use between 3 and 4 hours per m² of a project. This also equates to 1 hour per stage and is in line with the method we cost most projects.

We advocate for reducing the size of your dwelling so that you build smarter and cheaper, however with average house sizes still sitting around 230m² (as per the article above from RealEstate.com.au) an architectural office would require 2 houses per employee per year to continue to be in business.

From our experience, this number of projects seems realistic. Ultimately, the best way to choose an Architect is deciding you want to work with them for who they are rather than what they cost.


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