Property developers navigating Australia’s construction market in 2025 may face construction costs that are 30.8% higher than pre-COVID levels, with skilled labour shortages driving 4-6% annual escalation. A quantity surveyor could be the difference between a profitable development and a project that exceeds budget by 10-30%—the typical overrun when professional cost management is absent.
Yet most developers grapple with fundamental questions: When should you engage a QS? What services do they actually provide? How do you select the right one? And perhaps most critically—what’s the return on investment when QS fees might represent 1-2% of your project cost?
This comprehensive guide covers everything Australian property developers may need to know about quantity surveyors and cost estimation, from early feasibility through final account settlement, across all states and territories.
What quantity surveyors do in property development
Quantity surveyors function as financial architects for property development projects. While many property investors may be familiar with QS services for tax depreciation schedules, development-focused QS work serves an entirely different purpose—managing live project costs, procurement, and contract administration throughout the development lifecycle.
Core QS functions
A quantity surveyor’s role in development typically encompasses five critical areas:
Cost estimation and planning involves preparing detailed cost plans at concept design, design development, and tender documentation stages. Early feasibility estimates might carry ±15-25% accuracy, improving to ±5-10% by tender stage as design details solidify. This progressive refinement could help developers make informed decisions at each project milestone.
Financial viability assessment sees QS professionals working with architects and engineers to evaluate project economics before construction starts. Cost data feeds directly into feasibility modelling for residual land value calculations and profit margin analysis—the foundation of development decision-making.
Contract administration encompasses tender documentation preparation including Bills of Quantities (BOQ), contractor evaluation based on submitted pricing, and ongoing contract management throughout construction. A QS may help ensure procurement processes deliver competitive, comprehensive pricing.
Cost control during construction requires monitoring expenditure against budgeted categories, assessing variation impacts before approval, providing monthly cash flow forecasts, and certifying progress payments for construction loan drawdowns. This oversight could prevent the cost overruns that plague many developments.
Value engineering identifies opportunities to optimise design and specifications, improving project viability without compromising quality. A skilled QS might find savings of 5-15% through material substitutions, construction methodology improvements, or specification refinements.
Professional regulation in Australia
The Australian Institute of Quantity Surveyors (AIQS) regulates the profession nationally through professional standards, code of ethics, and continuing professional development requirements. With over 5,000 members across consultancies, contractors, developers, government agencies, and financial institutions, AIQS maintains international affiliations including the Royal Institution of Chartered Surveyors (RICS).
Member grade designation—MAIQS, CQS (Member, Certified Quantity Surveyor)—typically requires an accredited degree, three years post-graduation experience, demonstrated proficiency across minimum eight competency units, and passing an Assessment of Professional Competence interview. Members should complete 15 hours annual CPD to maintain their designation.
Victoria stands alone in requiring mandatory QS registration with the Victorian Building Authority. No other Australian jurisdiction mandates registration, though AIQS membership may demonstrate professional competency nationwide. Victoria’s requirements include minimum two years supervised practical experience, portfolio evidence for at least three building projects of different purposes, and professional indemnity insurance at minimum $1.5 million.
Development QS versus tax depreciation QS
A critical distinction often confuses developers: development-focused QS services differ fundamentally from tax depreciation schedules.
Tax depreciation QS services target property investors post-completion, preparing reports that identify depreciable assets for ATO claims. These reports typically cost $400-$800 and focus on capital works deductions under Division 43 and plant/equipment depreciation under Division 40.
Development QS services target developers during active projects, managing costs from feasibility through construction to final account settlement. Services might cost $5,000-$100,000+ depending on project scale and scope, focusing on cost planning, procurement, contract administration, and financial control.
The confusion arises because many QS firms offer both services, but the purposes, deliverables, and fee structures could not be more different.
When to engage a quantity surveyor
Strategic timing of QS engagement may directly impact development outcomes, with early involvement typically delivering maximum value.
Feasibility stage
The feasibility stage represents the highest-value opportunity for QS engagement. Initial cost estimation based on preliminary designs, site characteristics, and comparable project data helps determine whether a development concept warrants further investigation.
Early engagement at this stage could prevent commitment to unviable projects before significant design investment occurs. A feasibility cost estimate might cost $2,000-$5,000 for residential projects or $5,000-$15,000+ for commercial developments, yet this investment could save tens or hundreds of thousands in aborted design work.
With Feasly’s feasibility software, you can model different cost scenarios and their impact on project returns, using QS estimates as the foundation for your total development cost inputs.
Design development stage
As architectural plans progress from sketch design through design development, cost plans should evolve in parallel. Updated estimates as design details emerge allow value engineering analysis to optimise costs while maintaining design intent, with contingency planning that reduces as design solidifies.
A QS engaged during design development might identify cost-saving opportunities that architects could implement without compromising the project vision—perhaps through material substitutions, construction methodology changes, or specification refinements.
Development application stage
Many councils across Australia require cost estimates for Development Application submissions, with specific thresholds triggering mandatory requirements:
New South Wales operates under the Environmental Planning and Assessment Act 1979, requiring projects over $3 million to include detailed cost reports by independent quantity surveyors. The City of Sydney specifically requires QS verification for major projects.
Other jurisdictions may require cost estimates for DA fee calculation but lack specific statewide QS certification thresholds, with individual councils setting requirements. Queensland, Victoria, and Western Australia councils typically request detailed cost summaries without mandating QS certification except for very large projects.
DA cost reports generally cost $600-$700 + GST for residential projects, with turnaround times around 3-5 business days. These reports verify construction costs, enabling councils to calculate Section 7.11 and 7.12 (formerly Section 94 and 94A) infrastructure contributions.
Tender and pre-construction stage
Detailed cost planning with accurate breakdowns of all project elements becomes essential before seeking builder quotes. Preparation of tender documentation and Bills of Quantities, tender evaluation and contractor selection advice, contractual advice on procurement routes, and pre-tender estimates all help ensure competitive, complete submissions.
A QS might identify gaps or inconsistencies in builder quotes that could indicate future variation claims or misunderstood scope—protecting developers from the lowest quote that becomes the most expensive outcome.
During construction
Construction phase engagement may provide critical financial oversight through:
- Valuation of work completed and payment certification
- Variation management and negotiation before approval
- Monthly cost reporting to stakeholders including developers and lenders
- Progress claim assessment for lender drawdown reports
- Cash flow forecasting updated as project progresses
- Risk identification and mitigation
Banks commonly mandate QS progress reports for construction loans on projects over $1-2 million, assessing loan-to-value ratios based on QS-certified completion percentages. Progress claim reports might cost $500-$1,500 per inspection, often structured as monthly package pricing.
Post-completion
Final account settlement and negotiation, defects liability period management, post-completion cost analysis and lessons learned, and insurance replacement cost estimates round out the QS role. These services help ensure clean project closure and capture knowledge for future developments.
Types of QS reports and deliverables
Quantity surveyors may deliver diverse report types serving different project stages and stakeholders. Understanding what each report contains and when you might need it could help you engage QS services strategically.
Cost plan variations
Preliminary cost plans (AIQS Stage A - Brief Stage) provide initial indicative costs for feasibility assessment. Based on limited information with ±15-25% accuracy, these plans might use cost per square metre rates derived from comparable projects, with broad elemental categories and limited detail. A preliminary cost plan for a residential development might break down as:
- Site acquisition and holding costs
- Site works and demolition: $150-$300/m² of site
- Building construction: $2,000-$3,500/m² GFA depending on specification
- Professional fees: 8-15% of construction
- Authority fees and contributions: Council-specific
- Finance costs: Based on drawdown profile
- Marketing and sales: 2-3% of GRR
- Contingency: 10-15% at this early stage
- GST implications: Margin scheme versus full input tax
Detailed cost plans develop during Outline Design (Stage B) and Detailed Design (Stage C) with comprehensive elemental breakdowns following AIQS Australian Cost Management Manual structure. Accuracy improves to ±8-12% at Stage B and ±5-10% at Stage C as design information solidifies.
Tender document cost plans (Stage D) represent the most detailed pre-construction estimates, with accuracy typically ±5% when based on complete documentation. These plans might include measured quantities by trade, specific material and product specifications, labour hour calculations, and detailed preliminaries breakdown.
Elemental cost breakdowns
Elemental cost plans generally follow AIQS ACMM structure, organising costs by building element rather than trade. A typical residential apartment breakdown might show:
Substructure (8-12% of construction cost): Excavation and earthworks, foundations and footings, ground floor slab, retaining walls and underpinning.
Superstructure (20-30%): Frame (concrete, steel, or timber), upper floors, roof structure, stairs and ramps, external walls (load-bearing).
External fabric and finishes (15-20%): External walls (non-load-bearing), windows and external doors, cladding systems, balconies and external features.
Internal fabric and finishes (12-18%): Partitions and internal walls, internal doors and frames, wall finishes (paint, tiles, renders), floor finishes (tiles, carpet, timber), ceiling finishes and systems.
Services (20-30%): Mechanical HVAC (8-12%), electrical including lighting and power (6-10%), hydraulic including fire protection (5-8%), lifts and escalators (if applicable), communications and security, renewable energy systems.
Site works (5-10%): Landscaping and external finishes, drainage and stormwater, external services and connections, fencing and gates, car parking and driveways.
Preliminaries (10-15%): Site establishment and temporary facilities, project management and supervision, insurances and bonds, temporary services, safety and security measures.
Contingencies (5-10%): Design development contingency, construction contingency, escalation allowance (separate or included).
Feasibility estimates versus detailed estimates
The difference between feasibility and detailed estimates could determine whether early budgets hold through to construction:
Feasibility cost estimates use cost per square metre rates based on limited information (±15-20% accuracy), determine project viability and establish initial budgets through functional unit rates ($X per apartment, $Y per townhouse), and may rely heavily on comparable project data adjusted for location, specification, and current market conditions.
Detailed construction estimates build from full tender documentation with itemised costs by trade, measured quantities from detailed take-offs achieving ±5-10% accuracy, comprehensive scope definition including specific inclusions and exclusions, and allowances for site-specific conditions identified through geotechnical investigation and survey.
The gap between these estimate types represents one of the most common causes of development failure—treating a preliminary estimate as a firm budget without understanding the inherent uncertainty.
QS reports for financing
Lenders may require specific QS reports to assess risk and approve construction loans:
Pre-funding reports for bank approval should include total development cost certification, detailed cost breakdown by element or trade, project documentation review (plans, permits, contracts, geotechnical reports), risk identification and mitigation strategies, cash flow forecasts aligned with construction programme, builder vetting (capacity, experience, financial stability, insurance), cost-to-complete analysis, and loan term adequacy assessment.
Progress claim reports follow a standard process that might involve: builder completes agreed work portion and submits claim with documentation; bank engages QS for independent assessment; QS conducts site inspection and prepares detailed progress report including project contract statement, approved variations, total work value completed, percentage completion by element, photographic evidence, comparison against plans and programme, quality assessment and defects identification, verification of material costs against invoices, cost-to-complete analysis, payment recommendation, and cash flow forecast updates.
Big 4 banks typically require 100-110% pre-sales as debt coverage at interest rates around 5.5-6.5%, while non-bank lenders might accept 35-70% pre-sales at approximately 10% interest, and private lenders may operate case-by-case with minimal pre-sales at 11-13% interest. QS reports help lenders assess whether project budgets align with market reality.
Development application cost reports
Council DA cost reports become mandatory when estimated costs exceed thresholds that vary by jurisdiction and council. These reports typically verify construction costs enabling councils to calculate infrastructure contributions under Section 7.11 and 7.12 (formerly Section 94 and 94A in NSW).
A DA cost report should include project description and scope, detailed cost estimate by element or trade, specification summary, exclusions clearly stated, AIQS membership certification, and may need to align with specific council templates or requirements.
Standard turnaround times might be 3-5 business days for residential projects, with fees around $400-$700 + GST depending on project complexity.
Current Australian construction costs for 2024-2025
Understanding current construction cost benchmarks helps developers assess whether QS estimates align with market reality. Costs vary significantly by building type, location, specification, and site conditions.
Residential construction costs
Detached houses demonstrate wide cost variation by specification and location:
- Basic project homes: $1,600-$1,900/m² (weatherboard, level block, project-home finishes)
- Mid-range full brick: $2,000-$2,900/m² (brick veneer, quality finishes, standard inclusions)
- Custom architect-designed: $2,500-$3,500/m² (high specification, complex design)
- Luxury residences: $3,900+/m² (premium finishes, advanced systems, architectural features)
City-specific rates for 2025 show:
- Sydney: $3,200-$4,300/m² (highest nationally)
- Melbourne: $2,700-$3,800/m²
- Brisbane: $2,700-$3,800/m²
- Perth: $2,600-$3,800/m²
- Adelaide: $1,900-$2,900/m² (most affordable major city)
Multi-unit residential costs reflect building height and complexity:
- Townhouses: $2,700-$3,500/m² nationally
- Low-rise apartments (1-3 storey): $1,580-$2,500/m²
- Mid-rise apartments (4-8 storey): $2,000-$3,000/m²
- High-rise apartments (9+ storey): $2,850-$3,500/m²
Height premiums reflect increased structural requirements, temporary works, crane costs, and construction complexity. A 10-storey apartment building in Sydney might cost $3,200/m², while a 3-storey building on the same site could achieve $2,400/m²—a 33% premium for height.
Commercial construction costs
Office buildings span wide ranges by specification:
- Basic standard: $2,800-$3,500/m²
- Mid-range: $3,500-$4,500/m²
- High-end premium: $4,500-$6,000+/m²
Office fit-out represents additional significant investment: basic fit-outs might cost $500-$800/m², mid-range $800-$1,500/m², and high-end $1,500-$2,000+/m².
Retail buildings typically require $2,000-$3,500/m² for standard construction or $3,000-$4,500/m² for shopping centres and complex developments with enhanced services and finishes.
Industrial and warehouse facilities prove most economical: basic construction $750-$1,000/m², standard $1,000-$1,500/m², or $950-$1,700+/m² for large facilities with 7-10m stud heights and specialist requirements. Hardstands might add $100-$180/m², with fencing around $100 per linear metre.
Regional variations
Location significantly impacts construction costs through labour availability, material transport, and market conditions:
- Sydney: 100% (baseline)
- Melbourne: 95-105%
- Brisbane: 95-115%
- Perth: 98-120%
- Adelaide: 95-108%
- Canberra: 92-125%
- Hobart: 95-125%
- Darwin: 100-120%
- Cairns: 110-130% (10-30% premium)
Regional versus metropolitan disparities typically show 20-40% lower costs in regional areas versus capital cities, with outer suburbs 15-25% less expensive than inner suburbs or CBD locations. Exceptions occur in mining regions (higher due to competition for labour) and tourist areas (moderate premiums).
Construction cost escalation trends
Construction costs have stabilised from pandemic peaks but remain dramatically elevated. The Cordell Construction Cost Index shows quarterly growth moderating to 1.0% in Q3 and Q4 2024, with annual growth reaching 3.4% for the 12 months to December 2024. The cumulative impact since COVID onset totals 30.8% increase—permanently embedded in baseline construction economics.
State-by-state variations reveal divergent market pressures:
- Queensland: 1.2% quarterly (Q4 2024), driven by Olympic infrastructure
- NSW and WA: 1.0% quarterly
- Victoria: 0.8% quarterly
- South Australia: 0.9% quarterly
Rider Levett Bucknall forecasts tender price escalation through 2025 ranging from 3.75% in Canberra to 6.0% in Townsville, with Brisbane at 5.6%, Perth 4.9%, Adelaide 5.0%, Sydney 4.5%, Melbourne 4.0%, Gold Coast and Darwin 5.0%.
Labour costs represent the primary and accelerating cost driver. Skilled trades price increases reached 5.5% annually in 2023-24, compared to 2.0% pre-pandemic averages. Construction sector wages increased 3.5% over the year to September 2024, with trade prices surging 6.2% in the 12 months to March 2024.
Critical skill gaps exist in bricklaying, tiling, roofing, carpentry, and plastering. BuildSkills Australia identifies 83,000 additional skilled workers needed nationally to meet housing targets—representing a 90,000 total shortfall for five-year delivery goals.
For developers, these escalation trends underscore the importance of professional QS engagement. Accurate cost estimation and ongoing cost control could be the difference between maintaining feasibility and watching margins evaporate to unexpected escalation.
QS fees and return on investment
Understanding quantity surveyor fees and the value they deliver helps developers make informed engagement decisions. While QS services represent an additional project cost, the return on investment typically exceeds the fee by substantial multiples.
Fee structures
Fixed fee basis provides greatest transparency and certainty:
- Council DA cost reports: $600-$700 + GST (3-5 day turnaround)
- Self-assessment reports: $200-$350 + GST
- Full QS reports: $400-$700 + GST
- Bank pre-funding assessments: Project-specific quotes
- Progress claim inspections: $500-$1,500 per visit
Percentage of contract value—most common for full project engagement—typically ranges 0.5-2% of total contract cost, often 1-1.5% for comprehensive services spanning feasibility through final account. A $500,000 project might generate $5,000-$10,000 in QS fees, while a $5 million development could incur $25,000-$75,000.
Hourly rates average $61/hour base, with senior consultants commanding $100-$150+/hour. Self-employed QS or specialist consultants might charge higher rates reflecting experience and expertise.
Fee-impacting factors
Several factors influence QS pricing:
- Project value and complexity (larger, more complex projects warrant higher fees)
- Scope of services required (full lifecycle versus specific reports)
- Reporting frequency (monthly progress claims versus quarterly reviews)
- Project duration (longer projects increase overall fees but reduce rate)
- Level of detail needed (preliminary versus detailed estimates)
- Regional location (city rates typically exceed regional)
- Urgency (rush jobs might incur 15-30% premium)
- Stage of engagement (early engagement may reduce overall cost)
Return on investment
The ROI of engaging quantity surveyors typically far exceeds their cost. Industry consensus holds that “a good QS will make back their fee and more on a project.”
Typical scenarios might show:
- QS fees: 1-2% of construction cost
- Value engineering savings: 3-8% of construction cost
- Variation management savings: 2-5% of construction cost
- Budget overrun prevention: 5-15% that might otherwise occur
- Lender requirement compliance: Mandatory for projects over $500,000-$1,000,000
A $500,000 project example could show:
- QS fee: $5,000-$10,000 (1-2%)
- Potential savings: $25,000-$75,000 (5-15%)
- Net benefit: $15,000-$70,000
Most projects without QS engagement exceed budget by 10-30%, while professional cost management could reduce this dramatically. The QS fee represents insurance against the cost overruns that sink development feasibility.
Hidden value beyond direct savings
Beyond quantifiable savings, QS engagement may deliver:
Risk reduction through early identification of cost risks, professional documentation that reduces disputes, clear scope definition that limits variations, and expert contract advice that protects developer interests.
Lender facilitation via better loan terms through comprehensive reporting, faster approval through quality documentation, higher loan-to-value ratios with professional oversight, and mandatory compliance for significant projects.
Time savings through efficient procurement processes, streamlined tender evaluation, faster issue resolution, and professional progress certification.
Quality maintenance via specification guidance that balances cost and quality, material substitution advice that maintains standards, and defect identification during progress claims that prevents compounding issues.
The true value of QS services often becomes apparent only when their absence causes problems—budget blowouts, lender delays, contractor disputes, or quality compromises that could have been prevented.
Selecting and working with quantity surveyors
Choosing the right quantity surveyor for your project may significantly impact outcomes. Understanding selection criteria, warning signs, and best practices for engagement helps developers maximise QS value.
Essential qualifications
AIQS membership levels provide the clearest credential assessment:
MAIQS, CQS (Member, Certified Quantity Surveyor) represents the minimum level for serious project work, requiring accredited degree plus three years post-graduation experience, passed Assessment of Professional Competence, and 15 CPD points annually. This designation indicates competence to practice independently.
FAIQS, CQS (Fellow, Certified Quantity Surveyor) indicates senior leadership level with 10+ years as MAIQS member and significant professional contribution beyond employment. This represents the highest credential available and might signal exceptional expertise.
Graduate/Affiliate AIQS designations represent entry-level professionals still building experience, suitable only for junior support roles under supervision. These practitioners may not yet have the expertise for independent responsibility.
Alternative credentials include RICS Chartered Surveyor (MRICS/FRICS) providing international recognition, particularly relevant for major commercial or infrastructure projects with overseas investors.
Key selection criteria
Relevant experience should match your project type and scale. Questions to ask might include:
- How many projects similar to mine have you completed?
- Can you provide specific examples in my development category?
- What scale projects do you typically handle?
- Do you specialise in development versus construction QS work?
Track record and references deserve thorough investigation:
- Request 3+ references from recent similar projects
- Check whether projects completed on budget
- Ask about issue resolution approaches
- Review completed project portfolios
- Verify claims about actual project involvement versus firm experience
Professional standing requires verification:
- Current AIQS/RICS membership (verify on institute websites)
- CPD compliance showing commitment to staying current
- No disciplinary actions (check through professional body records)
- 5+ years in practice for lead QS on significant projects
Communication and approach proves crucial for successful collaboration:
- Responsiveness to inquiries (slow response during engagement signals potential issues)
- Clear explanations without excessive jargon
- Proactive rather than reactive mindset
- Regular reporting commitment
- Developer-focused versus contractor-focused orientation
Critical warning signs
Serious red flags demanding avoidance include:
- No current AIQS/RICS membership or unverifiable credentials
- Unwilling to provide references or poor references provided
- No professional indemnity insurance or inadequate coverage
- Overpromising with unrealistically low costs or guaranteed outcomes
- Slow or poor communication during engagement phase
- Lack of specific experience in your project type
- Prices significantly lower than market (suggesting inexperience or corners cut)
- Vague scope or deliverables description
- No written engagement agreement
- History of disputes or disciplinary actions
Warning signs requiring caution might include:
- Limited technology capability (outdated software, no digital collaboration)
- No recent project experience (indicating outdated cost knowledge)
- One-person operations without backup or succession plan
- Unwilling to commit to reporting schedules
- Focuses only on price not value
- Doesn’t ask detailed questions about your project
- Generic proposals without project-specific insights
Development-specialist versus generalist QS
Development-specialist QS may offer:
- Specific property development experience and understanding
- Focus on developer’s commercial objectives beyond construction costs
- Expertise in feasibility, finance, ROI, and development viability
- Familiarity with lender requirements and investor perspectives
- Value engineering from developer’s viewpoint
- Understanding of market positioning and specification decisions
Generalist QS might bring:
- Broad construction experience across sectors
- Traditional services focus (BOQ, measurement, valuations)
- Contractor or consultant backgrounds
- Suitability for standard construction or builder-led projects
For property development projects, a development-specialist QS could provide significantly greater value through understanding of feasibility modelling, finance structuring and bank requirements, investment returns and exit strategies, and risk from developer rather than contractor perspective.
Questions to ask when engaging
Experience and capability verification:
- How many projects of this type and scale have you completed?
- Can you provide references from recent similar projects?
- What specific experience do you have with this development type?
- Who will actually work on my project—partner or junior staff?
Service and process clarity:
- What services are included in your fee?
- What specific exclusions should I be aware of?
- What’s your typical reporting frequency?
- How do you handle scope changes?
- What software and tools do you use?
Commercial terms:
- What fee structure do you recommend and why?
- What are your payment milestones?
- What professional indemnity insurance coverage do you carry?
- Can I review your standard engagement letter or contract?
Project management approach:
- How early should I engage you for best value?
- What information do you need from me?
- How do you identify risks and savings opportunities?
- What’s your tender evaluation process?
Best practices for working with QS
Effective briefing requires providing:
- Site details (location, size, topography, services availability)
- Design documents at any stage (even preliminary sketches help)
- Detailed project scope and vision
- Budget parameters (total budget, funding status, constraints)
- Timeline (desired completion, key milestones, DA lodgement dates)
- Council requirements (DA conditions, planning requirements)
- Specifications (quality level, target market, materials preferences)
- Constraints (site issues, heritage, environmental, neighbourhood context)
- Commercial context (project objectives, target market, risk tolerance)
Optimal engagement practices might include:
- Engage as early as possible (feasibility stage ideal for maximum value)
- Provide complete accurate information promptly
- Transparency about budget and constraints (helps QS help you)
- Prompt decisions when QS requests direction
- Immediate notification of all design changes
- Trust their expertise and consider recommendations seriously
- Pay invoices on time (maintains good relationship and prioritisation)
- Maintain regular communication throughout project lifecycle
Common mistakes to avoid:
- Waiting until design finalisation (missed value opportunity)
- Withholding budget or constraint information (prevents optimal advice)
- Making changes without informing QS (undermines cost control)
- Choosing solely on lowest price (false economy)
- Ignoring QS warnings about cost risks (they’ve seen what happens next)
- Micromanaging technical processes (you hired expertise for a reason)
- Allowing scope creep without cost review (recipe for budget blowout)
- Bypassing QS for contractor negotiations (undermines their role)
State-by-state requirements and variations
Quantity surveyor regulation and requirements vary significantly across Australian jurisdictions. Understanding your state’s specific rules could help ensure compliance and avoid delays.
Victoria—Mandatory registration
Victoria operates the most stringent regulatory framework. The Victorian Building Authority requires mandatory QS registration under the Building Act 1993 and Building Regulations 2006.
Registration requirements include:
- Minimum two years supervised practical experience under registered QS or AIQS member
- Portfolio evidence for at least three building projects of different purposes
- Accepted qualifications from RMIT, Deakin, or Holmesglen institutions
- Technical reference from registered QS in same or higher class
- Professional indemnity insurance at minimum $1.5 million per claim and aggregate
Registration applications typically process in 8-12 weeks. This represents the strictest barrier to practice in Australia—only Victoria mandates QS registration, while other jurisdictions rely on professional membership as the quality standard.
New South Wales—Clear DA thresholds
NSW establishes the clearest Development Application cost thresholds under the Environmental Planning and Assessment Act 1979:
- $0-$150,000: Cost summary by applicant or suitably qualified person
- $150,000-$3 million: Cost summary by suitably qualified person
- Over $3 million: Independent quantity surveyor detailed cost reports
The City of Sydney specifically requires QS verification for projects over $3 million. Section 7.11 (formerly Section 94) and Section 7.12 (formerly Section 94A) infrastructure contributions calculate based on development costs, with verification by registered QS for Development Applications.
Queensland—Minimal QS-specific regulation
Queensland’s Queensland Building and Construction Commission (QBCC) licenses building contractors and trades but maintains no specific QS registration category. Professional indemnity insurance applies to certain QBCC licence classes but not QS consultants unless holding contractor licence.
DA requirements vary by local government authority without specific statewide QS threshold mandates. However, Queensland demonstrates highest quarterly cost growth nationally in 2024-2025, driven by Olympic preparations and major infrastructure pipelines—making professional cost management particularly valuable in this market.
Other jurisdictions
Western Australia, South Australia, Tasmania, Northern Territory, and Australian Capital Territory impose minimal QS-specific regulation:
- No mandatory QS registration requirements
- Building surveyor and certifier licensing exists but doesn’t extend to QS
- AIQS membership serves as primary quality indicator
- Council DA requirements vary by local authority
- Professional indemnity insurance recommended but not mandated (except Victoria)
This lighter regulatory approach places greater emphasis on professional membership and client due diligence when selecting QS services.
Professional indemnity insurance
Only Victoria mandates PI insurance for QS at $1.5 million minimum. However, AIQS Code of Conduct requires members “holding themselves out as practicing” to maintain “appropriate professional liability insurance.”
Most practicing QS carry $1-5 million coverage, with large firms maintaining $10+ million for complex projects. Coverage typically encompasses:
- Negligent acts, errors, or omissions in professional work
- Arithmetical errors in BOQ or cost estimates
- Unrealistic cost estimates impacting project decisions
- Over-certification of payments
- Unintentional breach of confidentiality
- Legal defence costs
- Compensation or damages awarded
Annual premiums might run $2,000-$10,000+ depending on coverage level, firm size and revenue, claims history, and project risk profile.
Common developer mistakes with quantity surveyors
Understanding frequent pitfalls could help developers avoid the costly consequences that occur when QS services are poorly understood or inadequately used.
Engaging too late in the process
The mistake: Developers often wait until design is substantially complete before engaging a QS, missing the highest-value opportunity for cost input.
The consequence: Value engineering at late stages requires redesign rather than optimisation during design. Fundamental viability issues might be discovered after significant design investment. Early-stage estimates by architects or builders may differ substantially from professional QS assessment.
The solution: Engage QS at feasibility stage, even with preliminary concepts. A $2,000-$5,000 preliminary estimate could save tens of thousands in aborted design work if the project proves unviable.
Treating preliminary estimates as firm budgets
The mistake: Using early feasibility estimates (±15-25% accuracy) as the project budget without understanding inherent uncertainty.
The consequence: Budget shortfalls emerge as design develops and estimates refine. Funding gaps create delays or force compromising specifications. Lender concerns arise when detailed estimates exceed feasibility assumptions.
The solution: Understand estimate accuracy ranges at each stage. Maintain appropriate contingency. Update estimates as design progresses. Budget to the refined estimate, not the preliminary figure.
Confusing development QS with tax depreciation
The mistake: Assuming the QS who prepares investor tax depreciation schedules offers the same value for active development projects.
The consequence: Tax depreciation specialists may lack development cost management expertise. Development timing and needs differ fundamentally from post-completion tax work. Missed opportunities for value engineering, procurement optimisation, and cost control.
The solution: Verify QS specialisation in development work specifically. Ask about experience managing costs through construction. Confirm understanding of development feasibility and lender requirements.
Selecting solely on lowest price
The mistake: Choosing QS based entirely on cheapest fee quote without considering experience, service scope, or deliverable quality.
The consequence: Inexperienced QS may miss cost risks that emerge during construction. Inadequate service scope leaves gaps in cost coverage. Poor quality estimates fail to satisfy lender requirements. False economy when savings from good QS far exceed fee differential.
The solution: Evaluate QS on value not just price. Consider experience, qualifications, references, and service scope. Understand that higher fees often deliver superior ROI through better cost control and risk management.
Ignoring QS cost warnings
The mistake: Dismissing QS concerns about budget adequacy, design complexity, or specification implications as excessive caution.
The consequence: Cost overruns that QS predicted but developer discounted. Reduced contingency or compressed timeline creates vulnerability. Lender alarm when construction exceeds budget, potentially triggering funding restrictions.
The solution: Take QS warnings seriously—they’ve seen what happens when concerns are ignored. If QS concerns seem excessive, seek second opinion rather than dismissing outright. Understand the experience and data behind QS advice.
Failing to notify QS of design changes
The mistake: Making design modifications, specification changes, or scope additions without informing QS and obtaining updated cost estimates.
The consequence: Cost control breaks down as changes occur without cost assessment. Running total of project cost becomes unreliable. Variations accumulate to create significant budget impact. Late discovery of budget shortfall when too late to address.
The solution: Establish change management protocol requiring QS input before approving changes. Maintain running cost impact log. Update budgets and feasibility models as changes occur. Empower QS to raise concerns about cumulative variation impact.
Bypassing QS in contractor negotiations
The mistake: Negotiating directly with contractors on variations, progress claims, or contract terms without QS input.
The consequence: Accepting pricing that QS would identify as excessive. Agreeing to variations without full cost understanding. Missing opportunities for competitive negotiation. Undermining QS role and effectiveness.
The solution: Route all contractor financial discussions through QS. Leverage QS market knowledge and negotiation expertise. Present united front between developer and QS. Allow QS to be “bad cop” on cost challenges.
Integrating QS services with development feasibility
Quantity surveyor cost estimates form the foundation of development feasibility analysis. Understanding how QS data flows into financial modelling could help developers make better-informed decisions and maintain alignment between cost reality and pro forma assumptions.
Total development cost components
A comprehensive QS cost estimate for feasibility might break down total development cost as:
Land acquisition and holding: Purchase price (residual land value calculation may determine this), stamp duty and transfer costs, legal fees, holding costs (rates, interest during planning).
Site preparation: Demolition and removal, site remediation if required, service connections and upgrades, geotechnical investigation implementation.
Building construction costs: Direct construction (from QS elemental estimate), preliminaries (site establishment, temporary facilities, project management), contingency (5-10% depending on design stage), escalation (if construction in future periods).
Professional fees: Architect (2-8% of construction depending on complexity), structural engineer (1-3%), services engineer (1-2%), town planner (fixed fee or hourly), surveyor (fixed fee), building certifier (fixed fee), QS fee itself (0.5-2%), other consultants as needed.
Authority fees and contributions: Development application fees, Section 7.11 and 7.12 contributions (calculated from QS cost report), building approval fees, water/sewer connection charges.
Finance costs: Interest during construction (drawn on development budget profile), loan establishment fees, valuation fees, legal fees.
Project contingency: Additional to construction contingency for project-level risks, typically 2-5% of total development cost.
Marketing and sales: Advertising and marketing campaign, sales commission (typically 2-3% of GRR + GST), legal fees for settlements.
GST implications: Input tax credits available, margin scheme eligibility and calculations, cash flow timing of GST payments and refunds.
The QS construction cost estimate might represent 50-70% of total development cost, with other categories calculated as percentages or fixed amounts. Accuracy in this largest component directly impacts feasibility reliability.
Integration with feasibility software
Platforms like Feasly model development feasibility by comparing total development costs against gross realisation revenue to calculate profit, margin, NPV, IRR, and return on cost. QS cost estimates feed directly into the TDC input, with sensitivity analysis showing how cost variations impact returns.
A feasibility model might show:
- Base case using QS estimate: 20% margin, $500,000 profit
- +10% cost scenario: 12% margin, $180,000 profit
- +20% cost scenario: 4% margin, negative $140,000 loss
This sensitivity analysis demonstrates why QS accuracy matters—a 10-15% cost estimation error could transform a viable project into a loss-making venture.
Lender alignment requirements
Banks assess loan applications by comparing multiple cost inputs:
- Developer’s feasibility study (using QS preliminary estimate)
- QS certified pre-funding report (detailed estimate)
- Bank valuer’s construction loan assessment
- Facility limit requested
Misalignment between these sources creates lender concern and potentially blocks approval. A developer feasibility showing $2.0M construction cost, QS report certifying $2.2M, and bank valuer assessing $2.3M might trigger loan amount reduction or additional equity requirement.
Best practice involves QS engagement before finalising feasibility so that feasibility assumptions reflect professional cost assessment rather than developer optimism or architect estimates.
Managing cost through construction
Once construction commences, ongoing QS cost reporting helps maintain feasibility assumptions. Monthly cost reports might show:
- Budget: $2,000,000 (from QS pre-construction estimate)
- Committed: $1,850,000 (contracts awarded)
- Spent to date: $950,000
- Projected final cost: $2,050,000 (+2.5%)
- Cost to complete: $1,100,000
- Variation impact: +$50,000
- Contingency remaining: $50,000
This reporting allows developers to see cost trajectory and make decisions before problems compound. If projected final cost substantially exceeds budget, options might include reducing scope, value engineering remaining works, or seeking additional funding.
Regular QS reporting integrated with project management and financial reporting creates visibility that poor cost control lacks.
The future of quantity surveying in Australia
The quantity surveying profession continues evolving in response to technology advancement, market conditions, and client needs. Understanding emerging trends could help developers anticipate how QS services might develop.
Technology and digital transformation
Building Information Modelling (BIM) increasingly influences QS work. 5D BIM links cost data to 3D models and construction schedules, enabling automated quantity take-offs from digital models, real-time cost updates as design evolves, and visual cost analysis by building element or space.
While BIM adoption in residential development remains limited, commercial and large-scale projects increasingly require BIM capability from QS consultants. This may become standard within 5-10 years across all project types.
Cloud-based cost databases enable more accurate regional and project-specific estimates, with platforms aggregating actual costs from completed projects. This data-driven approach may improve estimate accuracy and reduce reliance on experience-based judgement alone.
Automation and AI might streamline quantity take-offs, preliminary estimates, and progress tracking. However, the interpretive and advisory aspects of QS work—value engineering, risk assessment, negotiation, and professional judgment—likely remain human-centric for the foreseeable future.
Market pressures and value delivery
Construction cost escalation and labour shortages increase QS value by making cost control and value engineering more critical. Projects that might have succeeded with informal cost management in stable markets now require professional oversight to maintain viability.
Lender requirements may continue tightening as construction industry insolvencies remain elevated (28% increase in 2023-24). More rigorous QS reporting and oversight could become standard for smaller projects than currently typical.
The shortage of experienced QS (particularly development-specialists) suggests demand may exceed supply in near term, potentially increasing fees but also emphasising the importance of early engagement to secure preferred consultants.
Regulatory evolution
Victoria’s mandatory registration model might expand to other jurisdictions if quality concerns emerge. However, the current trend suggests continued reliance on professional membership (AIQS/RICS) as the quality standard outside Victoria.
DA cost reporting thresholds may decrease as councils seek more rigorous cost verification for infrastructure contribution calculations. What currently triggers at $3M in NSW might extend to $1M or lower in some councils.
Building industry reforms following construction company failures could include enhanced QS oversight requirements, particularly for progress claim certification and cost-to-complete reporting.
Your quantity surveyor engagement checklist
Successful QS engagement requires systematic approach from selection through project completion. This checklist helps ensure you maximise QS value:
Pre-engagement phase
- Define your project scope and objectives clearly
- Identify appropriate QS specialisation (development-focused)
- Request proposals from 3-4 qualified QS
- Verify AIQS membership status on institute website
- Check professional indemnity insurance coverage
- Contact references from recent similar projects
- Compare scope, deliverables, and pricing
- Select based on value not just lowest price
Engagement phase
- Review and negotiate engagement letter or contract
- Clarify scope, deliverables, and exclusions in writing
- Establish fee structure and payment milestones
- Agree reporting frequency and format
- Define communication protocols and contact points
- Set expectations for response times
- Confirm information you need to provide
Project delivery phase
- Provide comprehensive project briefing
- Supply all available design documents and site information
- Maintain open communication throughout project
- Notify QS immediately of any design changes
- Review and discuss estimates and cost reports thoroughly
- Act on value engineering recommendations
- Involve QS in contractor selection and tender evaluation
- Route all contractor financial discussions through QS
- Pay invoices promptly per agreed terms
Quality control phase
- Verify estimate aligns with market reality and comparable projects
- Confirm all cost components are included (no major gaps)
- Understand accuracy range for current project stage
- Check whether contingency is appropriate
- Ensure QS reports satisfy lender requirements
- Review cost trends and escalation assumptions
- Monitor whether cost advice proves accurate as project progresses
Post-project phase
- Document lessons learned for future projects
- Evaluate QS performance against expectations
- Provide feedback (positive or constructive)
- Maintain relationship for future developments
- Request final account reconciliation
- Archive cost reports for future reference