Unravelling the Cost of Hiring a Sustainable Architect for your Home
A Guide to Fees in 2023 for Home Extensions, Refurbishments, and Sustainable Retrofits
Commissioning an architect to design your home is one of the most exciting steps of any building project. However, most homeowners have little experience with a building project, and most have never hired an architect. You may be asking:
How do architects typically charge for their services?
What services are included in the architect’s fee?
Are there additional costs or expenses that I should be aware of?
How should I discuss fees or approach a negotiation?
To assist homeowners at the start of their project, we have written this guide to answer your questions and help you make the most critical decision that will inform the success of your project.
Explanation of architect's fees
Architect fees refer to the amount of money an architect charges for their professional services to help you identify the most suitable design strategy and manage the overall process.
These fees cover a range of critical tasks needed to ensure the success of your project. Our checklist contains hundreds of individual tasks, but here are just a few of the critical ones:
Meeting you at the property and helping you assess the project feasibility
Exploring your overall design and layout options
Developing the layout into a cohesive 3-dimensional project
Obtaining statutory permissions
Determining and documenting how the building is to be constructed to ensure sustainability and longevity
Choosing suitable fittings finishes
Finding the right builder and organing the building contract
Conducting site visits and administering the building contract
The fees represent an investment in the professional advice and expertise provided by an architect, which can be crucial to the success or failure of a building project. By selecting the right architect for the project, you can ensure you receive valuable professional advice and guidance throughout the project, which ultimately leads to its success and the long-term enjoyment of your home.
Importance of understanding architect's fees
The fees associated with hiring an architect can vary significantly, depending on the scope and complexity of the project, the level of expertise and experience of the architect, and the exact services provided. Understanding the different types of architect fees and the factors that can impact fees when planning a construction project is essential. By clearly understanding these factors, you can make informed decisions to avoid surprises when hiring an architect or budgeting for your project.
Overview of the article
This article will provide an overview of the different types of architect's fees, including percentage-based, fixed, hourly, and combination fees, and the factors that can impact them, such as project size, complexity, and location. We will also discuss the range of architect's fees for various types of domestic projects, such as residential, renovation, retrofit, and Passivhaus projects, as well as other costs associated with hiring an architect, such as additional services, reimbursable expenses and taxes.
Additionally, we will discuss how hiring an architect specialised in sustainability will help you save money on the design, maintenance and future running costs. We will also discuss how an architect’s broad experience or specialisation can save hiring other consultants and avoid costly mistakes.
By the end of this article, you should have a comprehensive understanding of architect fees and feel more confident about working with an architect to bring your construction project to life.
Types of Architect's Fees
An architect's fee can be structured in various ways, each with advantages and disadvantages. Understanding the different fee structures can help you make informed decisions when choosing the right architect for your project.
Here are four of the most common types of architect's fees:
Percentage-based fee
A percentage-based fee is calculated as a percentage of the total value of the construction. This type of fee is often used for large, complex projects where the architect's role is crucial. The architect’s role is often very focused on large projects, as they are supported by a team of other professionals like project managers, engineers, quantity surveyors, and other consultants. The percentage rate can vary depending on the scope and complexity of the project but is typically between 8% and 15% in the UK.
One advantage of a percentage-based fee is simplicity. You will be given one simple, all-encompassing number, and there is no need to keep track of the hundreds of tasks needed for project delivery. Flexibility and speed are other advantages since the fee is automatically adjusted with changes in scope or the construction value. However, that does not mean that changes to the brief will not attract additional design fees if divergent changes require a redesign or revisiting previously completed stages. Additional fees may also apply for services outside of those covered by the fee agreement. The construction value is not to be confused with the contract value, which may not include the value of client supply items not included in the contract.
One disadvantage of a percentage-based fee is the unpredictability, not only due to an increase in scope and budget but also due to changes in market conditions, as in the years following the coronavirus pandemic.
Percentage fees can also be seen as a conflict of interest, leading to, at best, a lack of adequate budget management and, at worst, an incentive for unscrupulous architects to extract extra fees, inflating the cost of the building and, consequently, their fee.
Fixed fee
A fixed fee is a set amount that the architect charges for their services, regardless of the scope or complexity of the project. This type of fee is often used for smaller, simple projects if the architect's role is less significant and the tasks straightforward. The fixed fee is typically agreed upon before the project begins and is based on the estimated time and resources required to complete the project.
A fixed fee is advantageous because it provides transparency and predictability. You will know exactly how much you will pay for the architect's services upfront. However, when fees are fixed, so is the scope and service. Designing your home can be a long process, and changes in direction can occur due to many factors. Your project and requirements may be more complex than assumed at the outset. If the project takes longer or requires more resources than initially estimated, the architect may need to revise the fee as the requirements change.
If you are unwilling to discuss revised fees or accept legitimate reasons for a change, the architect may reduce the level of service. A refusal to dialogue may erode the goodwill needed to attend to your needs and deliver the project successfully and can even lead to the termination of your agreement with the architect.
Hourly fee
An hourly fee involves charging based on the time the architect spends working on the project. This type of fee is typical for smaller projects, tasks requiring specific expertise, or involvement in unforeseen issues. Hourly rates can vary depending on the architect's experience and the project's location.
One advantage of an hourly fee is that it provides transparency and flexibility, as the client only pays for the time the architect spends working on the project. However, this type of fee can be unpredictable, as the project's total cost will depend on how much time the architect spends on each task. Pritzker Prize-winning British architect David Chipperfield famously said, "The difference between good and bad architecture is the time you spend on it." While true, an overall project budget is a priority for most clients who will want to set some reasonable limits.
Combination fee
A combination fee is a fee structure that combines elements of different fee structures, such as a fixed fee for some tasks and an hourly fee for others. This type of fee is often used for projects that require a range of services from the architect.
The main advantage of a combination fee is that it allows the architect to provide you with a more customised fee structure designed around your needs. The architect will need more time upfront to understand your requirements, set out a proposal, and reach an agreement with you.
Conclusion
Overall, each type of architect's fee has advantages and disadvantages, and the best fee structure will depend on the specific needs and requirements of the project.
A full-fee proposal takes time and may involve paid feasibility work to clarify the brief and scale of the project through a construction cost forecast.
When working with an architect, discussing the fee structure that works for both parties at the outset is essential
With sustainability at the heart of our practice, we are dedicated to finding workable solutions that avoid surprises and ensure the feasibility and deliverability of all projects. At Ciarcelluti Mathers Architecture, we believe in transparency and work closely with our clients to determine the most appropriate fee structure for their projects. We typically offer a combination fee, using the most appropriate fee for each type of service. We are happy to discuss the different options and provide a clear breakdown of costs to ensure that our clients fully understand the fees associated with their projects upfront.
Factors that Affect an Architect's Fee
Architect's fees can vary greatly depending on several factors. Here are four key factors that can impact the cost of hiring an architect:
1) Project size
The size of the project is one of the most significant factors that can impact the architect's fees. Larger projects typically require more time and resources from the architect, resulting in a higher total fee. Conversely, smaller projects may require less time and resources, lowering total fees. But, since all projects go through a similar process, there is an unequal relationship between fee (or time) and size. Large projects benefit from economies of scale, and you should expect higher fees for smaller projects as a percentage of size or budget.
The definition of a small project can vary depending on the location and context, and no fixed budget range qualifies a project as "small." However, it would be fair to say that small residential projects in the UK, such as home extensions or refurbishments, can range from £50,000 to £250,000. In contrast, larger projects such as new builds or major renovations can cost several million pounds.
2) Complexity of the project
Projects that require a high level of detail or customer service may require more time and expertise from the architect, resulting in higher overall fees. Conversely, projects that are more straightforward or have a simpler design may require less time and expertise, resulting in lower overall fees. Buildings like warehouses and industrial storage sheds are the least complex projects. Private one-off homes can be some of the most complex projects, particularly considering size, something you might call complexity/m2.
3) Location of the project
The location of the project can also impact an architect's fee. Architects in larger cities or areas with higher living costs may charge higher fees than those in towns or rural areas. Additionally, architects who must travel long distances to the project site may charge additional fees to cover travel expenses. Fee surveys that report regional variations by organisations such as Mirza & Nacey Research Ltd and the RIBA vary but suggest that fees in London can be 20% to 30% higher than the national average.
4) Level of expertise and experience of the architect
The architect's expertise and experience is another essential factor impacting fees. More experienced architects have more skill and knowledge to share with their clients and charge higher fees than those just starting their careers. Additionally, architects specialising in sustainability or historic preservation may charge higher fees due to their specialised knowledge and expertise.
When selecting an architect based on fees, it is critical to assess the risks. A more experienced architect is more likely to be able to keep the project on budget, navigate pitfalls and avoid costly mistakes. A higher architectural fee might be a tiny proportion of the overall project budget. Investing in a more experienced architect can save money in the long term.
It is essential to remember that an architect's fees can vary widely based on these and other factors, and it's important to discuss fees and negotiate a fee structure that works for both parties. By understanding the factors that impact an architect's fees, you can make informed decisions about hiring an architect and budgeting for your project.
Typical Architect's Fees for Domestic Projects
Architectural fees for domestic projects can differ significantly due to the type of work and the extent of services needed.
Generally, the average fee for all building types in all regions across the UK can range from 8% to 15% of the total construction value.
It is worth noting that these studies publish average fees. There are cheaper architects providing a basic service and those focussed on customer care, a stress-free process and a high-quality outcome. You should be clear about what you’re looking for at the outset.
For private domestic work in London, four critical factors are worth considering:
Private domestic projects are considered relatively complex, particularly in relation to their size.
Fees in London are typically 20% to 30% higher than the national average.
Where clients do not employ an entire consultant team, an architect generally wears more hats and does more work. A versatile architect with more experience will be a valuable guide for any homeowner.
Small projects typically go through the same process as large projects, and the fee will comprise a higher portion of the total budget.
Careful consideration of what to expect is critical for any homeowner wanting to make an informed decision.
Here are some indicative fee ranges for some common types of residential projects in the London area:
New-build private dwellings
Among the different types of residential work, designing a new-build house on an empty plot of land is usually the most straightforward. There is generally less context, such as an existing building or complex site, to pose constraints. This can lead to lower fees compared to other types of residential work.
For projects in London and surrounding areas, fees for designing new-build houses may range from 14% for small projects to 7.5% for large ones.
Residential extensions, lofts and basements
The design and construction of a residential extension must typically address some existing constraints, such as its relationship to the existing building, the site, the existing above and below-ground services, neighbouring properties and the style and character of the existing property and neighbourhood. As a result, the design is more challenging.
Architects working on London extensions may charge 18% to 10% for a residential extension.
Renovation and refurbishment projects
Renovation projects in the UK, where most buildings are pre-war, can present a variety of challenges for architects and designers:
Working with existing structures can present challenges in maintaining structural integrity while making significant alterations or additions.
Changing the layout within the limits of an existing space is challenging, especially when significant improvements are desired, such as open-plan spaces or maximising storage.
Alterations to the original structure may be unknown, leading to design and construction challenges.
Renovation projects must meet modern sustainability and energy efficiency standards. Designers must find ways to improve a building's energy efficiency, reduce its carbon footprint, and incorporate sustainable materials and technologies into their designs.
Changes might impact how the building regulations are applied. For example, adding a loft might change the fire strategy and require changes to the lower floor.
Renovation projects can be expensive, and the architect must balance the client's budget with their brief, often requiring creative solutions without compromising quality.
An experienced architect will help you avoid pitfalls and plan for unknowns.
For renovation and refurbishment projects in London, fees for small to large projects may range from 16% to 12% as a percentage applied to the total construction value.
Listed Buildings
Working with historic buildings presents unique challenges, such as preserving original features while making the building fit for modern use. Architects must understand the historical context of the building and work within any restrictions affecting alterations to the building. Planning and Listed Building consent can be demanding.
For Listed Building work in London, fees can range from 21% for small projects to 14% for larger projects.
Sustainable Retrofit
Going beyond building regulations to target more energy-efficient standards like Passivhaus is an area where experience is invaluable. Working with an existing building to make significant improvements requires an in-depth understanding of building physics and technology and the expertise to know what is feasible and practical.
For retrofit projects that modify an existing building to improve energy efficiency and reduce carbon emissions, the architect's fees may range from 20% for small to 10% for large projects.
Passivhaus
Passivhaus projects are designed to meet rigorous energy-efficiency standards. They are complex projects requiring extensive technical knowledge and practical experience, especially if budget is a concern.
A Passivhaus project might have an architect and Passivhaus consultant working on the design or an architect who is also a Passivhaus designer.
Architect's fees for a Passivhaus project may range from 20% for small projects to 12% for large ones.
Summary
All fees can be higher or lower depending on the project's complexity, the level of involvement required from the architect, and the project's location. Architects may charge a fixed fee or an hourly rate for smaller projects.
It's important to note that these fee ranges are general guidelines and may vary depending on the specific circumstances of each project.
You should consider the level of customer service you expect and the desired outcome when budgeting based on low, average or high fee numbers.
You should discuss fees with the architect and agree on a fee structure for both parties. Understanding the range of architects' fees for different projects allows you to budget appropriately and ensure you receive the services you need to achieve your desired outcome.
Other services
Considering the broad experience an architect might bring is worth considering. There are benefits of working with an architect with expertise in related fields.
The architect you work with will advise you using all their knowledge. This can be especially valuable for small projects that lack an entire consultant team but encounter challenges in related areas. An experienced architect will help you avoid pitfalls and costly mistakes.
Architects with experience or qualifications in related fields can provide extra services for a complete design or minor assistance in an area that might significantly affect the project's outcome.
Other services we offer:
At Ciarcelluti Mathers Architects, we can provide you with interior, lighting, joinery and kitchen design.
We also prepare photorealistic computer-generated images of our designs in-house to fully explore a developing design and you visualise the space with realistic materials and lighting conditions. This will help you make informed decisions.
Employing an architect like us with Passivhaus certification can save the cost of using another Passivhaus consultant and streamline the process, saving you money in the design phase. Even if you don’t have Passivhaus ambitions, having us guide you can help you future-proof any project and reduce your home's maintenance and running costs.
Other Costs Associated with Architect's Fees
As with any professional service, additional costs may be associated with the architect’s fee. You need to be aware of these costs and factor them into your budget. Some common additional costs include reimbursable expenses, such as travel expenses and fees for third-party consultants.
Architect’s fees are subject to VAT at a standard rate of 20%. However, there are some circumstances where reduced VAT rates may apply. Taxation is complex and it would be worth speaking to an architect or accountant if you believe you can benefit.
By discussing associated costs upfront, you can avoid unexpected expenses and budget effectively for your project.
How to Discuss Fees with an Architect
The work of an architect is collaborative. Architects are team players and look to construct positive relationships. Most architects will propose a fee they feel is reasonable, and fee negotiation can risk eroding the goodwill they put forward towards the shared goals of your project.
Here are some tips on how to get a good fee proposal from an architect:
Research: Do your due diligence and research standard rates for similar projects in your area. This will give you an idea of what to expect.
Realistic Budget: Be upfront about your budget limitations. This will help the architect know how to tailor their fee structure to fit within your financial parameters. Be honest and realistic about your budget expectations. Being cheeky by stating a low budget can result in misaligning the brief and budget, with services and design solutions not addressing the needs stated by your brief or "wish list". Revealing the true budget should also result in a lower percentage fee. Even if a percentage fee is not offered, it may be used to benchmark the proposed service and fee.
Breakdown of fees: Request a comprehensive breakdown of the architect's fees, including services offered and additional costs. This will help you understand the fees and where there might be room for negotiation. The fees an architect proposes will be based on an agreed scope of service. Negotiating fees with an architect involves engaging in a process to understand where their service can be reduced.
Staged fee structure: Most architects will break fees into a staged fee structure that divides payment into different project stages. This can make payments more manageable and minimise surprises along the way. But consider more granularity, such as monthly payments or an upfront deposit or retainer, that can minimise the architect's risk and lower their fees.
Written agreement: Once you've agreed on the fee structure, get everything in writing to avoid any confusion or disputes down the line.
Ask questions: Don't hesitate to ask the architect to explain any fees you're unsure of. This will help you decide whether the fees are reasonable or require further discussion.
Tips for Successful Negotiation
If you have decided to work with the architect but are not happy with the proposal, you may wish to enter further discussions. Most architects see fee negotiation as a confrontation, but discussing concerns upfront is crucial.
Here are some tips for approaching a negotiation:
Respect: Always remember that architects provide valuable service, so approach the discussions respectfully and professionally. Good customer service and an open line of communication can make all the difference in a project's success.
Build a relationship: Developing a positive working relationship with the architect can lead to a more collaborative and productive process. Be transparent and open to feedback. Ask questions to understand the architect's perspective better.
Open-mindedness: Be open to different fee structures or payment plans that may work better for both parties.
Win-win solutions: Seek solutions that benefit both parties instead of trying to win the negotiation at all costs. Architects are looking for clients with shared values who will be good long-term partners, so aim to build a mutually beneficial relationship.
Negotiating fees with anyone can be daunting, but by following these tips, you can ensure you are getting fair and reasonable fees for the services being provided. Remember, you are not trying to win a sprint; you are involved in a group marathon and want motivated talent on your team!
Conclusion
When hiring an architect, you should be transparent with your project goals and budget, communicate these upfront, and be willing to invest in a full-fee proposal to achieve the best outcome. You need to be aware that a full-fee proposal takes time and may involve paid feasibility work to clarify the brief and scale of the project through a construction cost forecast.
The fees charged by architects can be structured in various ways, including percentage-based, fixed, hourly, or a combination of these. The fee will depend on factors such as the project size, complexity, location, and required level of expertise.
You should also be mindful of the additional costs associated with architect's fees, such as reimbursable expenses and taxes. Understanding these fees is crucial, as it helps you make informed decisions about managing your project budget and hiring the right architect for your needs.
Negotiating fees is possible and can result in a win-win situation if both parties are respectful and looking for solutions that work for everyone. Rather than seeing architect's fees as a project expense, it can be helpful to consider their fee as an investment, providing less stress during the project and benefiting your future happiness as the occupier.
Hiring the right architect is crucial for a successful building project. With the right architect, you can achieve your project goals within your budget and enjoy a successful outcome for many years.
