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ARCHITECTS

When is it worth paying more for architectural services?

Updated: Oct 11

Architectural services can mean different things to different people, with some looking for the best possible service while others simply want the cheapest way to meet minimum legal requirements on their project. Most clients fall between these two extremes and, for those who are price sensitive but don’t want to risk getting a poor quality service, obtaining multiple architectural quotes can be extremely confusing due to the huge range of prices. This makes it vitally important to understand when it does and when it doesn’t make sense to pay more for architectural services.

If one obtains enough quotes for an architectural project, it’s not unlikely that the most expensive one would be ten times as much as the cheapest one. These excessive differences can be caused by a variety of factors. On the lower end, it may be possible that the quoting party does not even meet the legal criteria for an architectural professional as explained in our article on the topic (https://www.xeno-urban.com/post/the-legal-requirements). It may also be that they don’t have the level of qualification and experience to adequately prepare them for the type of work required on the project, a topic we touch on in our article about the differences between architects and draughtspeople (https://www.xeno-urban.com/post/architects-vs-draughtspeople-1). Similarly, there are certain types of projects that the different categories of registration aren't even legally allowed to take on, another topic we discussed in a separate article (https://www.xeno-urban.com/post/can-any-architectural-category-design-my-project). On the high end, there are architects who have become very famous for their work and it is not uncommon for clients to pay a large premium just for the brand recognition of having their project associated with the architect or firm in question.

Clients can certainly have their own valid reasons for accepting quotes at either the extreme low or high end of the pricing spectrum as outlined above, but for those looking to get the best value for their money, both of these options should almost certainly be discarded. With the exception of well understood changes to the scope of architectural services on offer, which will be discussed in greater detail in a future entry, the SACAP guideline architectural fees should be used as a benchmark with quotes that differ by 40% or more in either direction being identified as likely offering poor value. For more information on the guideline fees, make sure to check out our entry titled “How much do architects charge?” (https://www.xeno-urban.com/post/how-much-do-architects-charge).

Unfortunately, it is not quite as easy to assess and compare quotes that are closer to the recommended fee scales, at least not in terms of looking only at the numbers. This is because small differences in fees could potentially have a massive impact on the quality of architectural services. The architecture industry in Southern Africa has been under immense pressure for several years due to the weakly performing economy and construction industry, resulting in downwards pressure on professional fees. The result is that the going rate of architectural fees in the industry is low which may sound like great news for clients, but it isn’t. To understand why, you have to look at how architecture firms make and spend money.

Unlike most businesses, architecture firms rely almost entirely on highly skilled labour to produce any type of output. This is not to say that labour is the only cost these firms must cover, with the highly specialised software and hardware necessary for quality architectural work in today’s industry easily costing in excess or R100 000,00 per professional per year. Combined with all the registration fees and regular costs of operating a business and the standardised cost of architectural projects where certain activities remain necessary and similar for each project, there is a surprisingly large fixed cost associated with architectural work. This fixed cost includes doing the bare minimum work necessary to obtain legal approvals for the construction of the project and this amount of work would be done by any competent professional. Importantly though, the quality of the design, be that in terms of aesthetics, useability or cost effectiveness has no impact on these legal approvals but has a gigantic impact on the return on investment the project yields. This design quality is the direct result of the amount of time the architectural professional spends on the project and this is the variable cost for an architecture firm.

As an architect, I have worked at multiple firms and I speak to many architects who work at different firms. The tragic reality is that many architecture firms have dropped their fees to the point that fixed costs on a project are barely covered, leaving little to no room for architects to put in the extra time and effort required to generate a thoughtful design that delivers improved value to the client. The good news is that a slightly more expensive fee can make a huge difference to the quality of a project.

As an illustration, let’s assume a residential project fee of R200 000,00 covers R180 000,00 in fixed costs and the minimum work legally required on a project, leaving R20 000,00 for the architect to work on the ‘design’ of a project. At a theoretical rate of R500,00/ hour, the architect can afford to spend a maximum of 40 hours on the design after which he/she would start making a loss on the project. These numbers are made up, but not unrealistic and with 40 hours, the architect is probably going to copy an old design onto the property with minimal thought for how well it accommodates the unique needs of the site and the client. If, however, the client paid the same architect only 25% more, the full R50 000,00 could be used for the variable design time cost, giving the architect 140 hours of ‘design’ time. The 25% fee increase results in an increase of 250% in design time before the architect makes a loss. Architecturally speaking, the value difference between a design that is completed in 40 hours and one that is completed in 140 hours probably far exceeds 250%.

Of course it is not guaranteed that an architect who charges 25% more is going to use that money to do a far better job, but the above example does show why significantly undercutting the recommended fees as outlined by SACAP makes it impossible to deliver high quality work. It is important to understand that some variation in pricing is a normal part of the competitive business environment. Some architects charge a reasonable premium for specialist knowledge or experience in dealing with certain types of projects and many firms try to improve operational efficiencies to bring down their pricing. Here at Xeno-Urban Architects, for example, we were inspired by the successful wide-scale adoption of remote working during the COVID-19 lockdowns to implement a permanent ‘virtual office’ environment which allows us to save the costs associated with a conventional office and pass those savings on to our clients. Even in spite of this, we are far from the cheapest in the industry simply because we refuse to deliver low quality work.

Ultimately the appointment of an architectural professional must be based not primarily on their fees, but on the quality of their work as evidenced through their portfolio, their level of qualification and registration, their professionalism and a number of other factors. We will explore what to look for and how to spot the warning signs of bad fit between project and architectural professional in a future post. What is clear though, is that not only can it be worth paying more for architectural services, but paying a little more can yield a disproportionately large gain in value through much higher quality architectural design.

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