Key Facts:
- Build Metric, an Australian quantity surveying firm, warns that builders are submitting tenders priced at current costs without accounting for escalation on projects that won’t begin for six to twelve months.
- RLB’s June 2026 market update forecasts tender price growth of between 4% and 6% across Australian cities in 2026, with ongoing labour shortages and record construction activity of $324.8 billion nationally driving sustained cost pressures.
- Additional cost impacts include a 1.5-3.5% increase linked to the Middle East conflict affecting freight, fuel, and imported materials, alongside a 208% rise in data centre commencements in 2025.
- On a $2 million fixed-price contract with a twelve-month delivery window and 5% escalation, a builder who fails to include a structured escalation allowance faces an exposure of $100,000 before work is complete.
- Build Metric states it incorporates escalation allowances calculated against RLB indices for each relevant market into every estimate it produces, attributing this practice as a key factor in its reported 98% accuracy rate.
SOUTH MELBOURNE, Australia – 06 October 2026 – Build Metric, an Australian construction estimating and quantity surveying firm, says a common and costly mistake is appearing in tender submissions across the country: estimates priced at today’s costs on jobs that will not be delivered for six to twelve months, in a market where construction costs are forecast to grow between 4 and 6 per cent nationally this year.
The figures come directly from RLB June 2026 market update, which forecasts tender price growth of 4% in Melbourne and Sydney, 5% in Brisbane, 5.5% on the Gold Coast, 5.3% in Perth, 5.1% in Adelaide, and up to 6% in Townsville across 2026. RLB also notes that construction work has reached a record $324.8 billion nationally, with data centre commencements alone up 208% in 2025 and ongoing labour shortages keeping downward pressure on prices structurally absent in most markets. The Middle East conflict added a further 1.5 to 3.5% to project costs depending on exposure to freight, fuel, and imported materials.
The practical consequence for builders is that an estimate prepared today and submitted as a fixed-price tender is already underpriced by the time the job starts, if it does not include a structured escalation allowance. Build Metric says this is one of the most consistent gaps it finds when reviewing builder-prepared estimates: material and labour costs are priced at current rates with no forward allowance built into the schedule. On a twelve-month delivery window with 5% annual escalation, the exposure on a $2 million job is $100,000. On a job in Brisbane or the Gold Coast, it is more.
“The escalation question is not complicated, but it gets skipped. A builder working off their own estimate prices what a job costs today. They are not necessarily thinking about what the same labour and materials will cost at month eight or month ten of the project. We build escalation allowances into every estimate we produce, calculated against the RLB index for the relevant market. It is one of the reasons our accuracy rate holds at 98%. The estimate reflects what the job will actually cost to deliver, not just what it costs to start,” said Luke Rose, Managing Director of Build Metric.
Build Metric provides construction estimating services to residential and commercial builders nationally, preparing quantity takeoffs, bills of quantities, cost estimates, and submission-ready tender documentation at a fixed cost. The company employs 45 full-time staff, reports a 98% accuracy rate across submitted estimates, and operates across Australia and New Zealand.
About us:
About Build Metric
Build Metric is an Australian construction estimating and quantity surveying firm based in South Melbourne, providing quantity takeoffs, bills of quantities, and tender documentation to residential and commercial builders nationally. Founded by Luke Rose, the company employs 45 full-time staff and operates across Australia and New Zealand.
