Why Are My Extension Quotes £40k Apart? The Real Reasons

Last updated: June 2026 · Figures checked against live North London quotes and current government fee schedules.

Why are my extension quotes £40,000 apart?

Quick answer: Because the builders are not pricing the same job. Specification assumptions, PC sum allowances, preliminaries, risk pricing, VAT status and missing scope routinely swing identical drawings by £40,000 in North London. A £55,000 quote and a £95,000 quote usually describe two different buildings.

It is the classic tender shock: you send one set of drawings to three contractors and receive £52,000, £68,000 and £94,000 back. Your instinct says someone is profiteering or someone is desperate. The truth is duller and more useful — each firm has filled the gaps in the drawings with different assumptions, and the gaps are where the money lives. Below is what actually sits inside that £40,000 spread, followed by a method for collapsing it.

What is actually different inside a £55,000 and a £95,000 quote?

Put two real-world quotes for the same 20m² rear extension side by side and the gap stops being mysterious:

Line	Quote A — £55,000	Quote B — £95,000	Why they differ
Preliminaries	£2,000	£9,000	B prices scaffold, welfare, skips and supervision; A largely omits them
Demolition and groundworks	£8,000	£12,500	A assumes 1m strip footings; B allows for clay and tree roots at 2.5m
Structure and steels	£15,000	£19,000	A carries a £2,500 steel PC sum; B prices the engineer's actual design
Roof	£6,000	£8,500	B includes a rooflight upstand and warm-roof build-up
Glazing	£4,500 PC sum	£13,000	B specifies the aluminium sliders the drawings imply
First fix	£6,500	£9,000	B includes underfloor heating and a relocated soil stack
Second fix	£5,500	£8,000	Spec level of sockets, doors and controls
Plaster and finishes	£7,500	£10,500	B prices tiling and full decoration; A excludes decoration
Contingency	None	£5,500	B absorbs surprises; A will invoice them as extras
VAT	Not registered — none added	Plus 20% (£19,000) on top	The single biggest hidden divider

Quote A is not £40,000 cheaper. Much of it is £40,000 vaguer — and several of its missing lines will reappear as extras invoices around week six.

How do specification assumptions create five-figure gaps?

Drawings without a costed specification invite every contractor to imagine a different building. One reads "glazed doors" and prices £4,500 of uPVC; another prices £13,000 of slimline aluminium. One assumes the existing drainage stays; another allows £2,400 to divert it. This is also why architect-designed schemes so often come back at double the expected budget — a beautiful set of plans tendered without a specification produces guesses, and guesses diverge by 40–70%. Three numbers to pin down before tendering: an exact glazing allowance in pounds, a named floor finish with a rate per m², and the foundation depth assumption the price is built on.

Why do preliminaries and site setup swing so widely?

Running a tidy site costs real money: scaffold hire, a welfare unit, 6–10 skips at £250–£350 a time, daily supervision. Established firms price this honestly at 8–12% of the contract; one-van outfits often price almost nothing and improvise. On a £75,000 job that is a £6,000–£9,000 difference before a brick is laid — and it shows up later as overflowing rubble, unprotected floors and a project nobody is actually managing.

What are risk pricing and busy-builder pricing?

Two quiet multipliers sit on every tender. Risk pricing: the contractor who has been burned by London clay prices the worst case; the one who has not prices the best case and argues about it later. Busy-builder pricing: a firm with a six-month order book adds 15–20% because they do not need your job — the high number is them saying no politely, or being paid handsomely to say yes. Best-case pricing has a familiar ending: the 12-week build that grinds past 30 weeks while extras are renegotiated mid-project.

Does VAT registration explain part of the gap?

Frequently, yes. Any builder turning over more than £90,000 in 12 months must register and add 20% to your bill, and almost every firm running two or more extensions a year is over that line. A sole trader under the threshold can therefore be a fifth cheaper without earning a penny less. That is not automatically a bargain — it usually signals a smaller outfit handling one job at a time — but it does mean a £79,000 ex-VAT quote is really £94,800, and must be compared against a non-registered £78,000 on that basis.

How do you normalise quotes so they compare fairly?

Five steps collapse most of the spread. One: issue every builder the same written specification, down to door brands and floor finishes. Two: require PC sums to be stated in pounds and set them identical across all tenders. Three: require preliminaries as a separate line. Four: get the VAT position in writing — registered or not, included or on top. Five: put each exclusions list side by side and price the gaps yourself. Homeowners who do this typically watch a 40–70% spread shrink to 10–15%, which is the honest difference between businesses rather than the difference between assumptions.

Frequently asked questions

Should I just pick the middle quote?

No — the middle of three guesses is still a guess. Normalise all three against one specification first; the "middle" quote sometimes turns out to be the most expensive once its exclusions and PC sums are priced in.

Is the cheapest quote always a false economy?

Not always, but interrogate it. If it is cheapest because the builder is below the £90,000 VAT threshold and runs lean prelims, that can be genuine value. If it is cheapest because nine lines are missing, you will pay the difference in extras.

How many quotes should I get for an extension?

Three is the working minimum; four gives you a pattern. With fewer than three you cannot tell an outlier from a market price, and outliers in either direction are the ones that deserve questions.

Can I show one builder another builder's quote?

Share the scope and the gaps, not the numbers. Telling a contractor the figure to beat invites a price engineered to sit £1,000 under it — usually by hollowing out the very lines you wanted included.

Why was my architect's cost estimate so far below every tender?

Design-stage estimates often use national average rates, while North London builds run £2,800–£4,200 per m². Add VAT, prelims and current glazing prices and a paper estimate can sit 30–50% under the real market before anyone has done anything wrong.

One specification, one fixed price, no assumption games — that is how we quote every project. Compare your numbers with the Extension Builder, or arrange a free site visit from our Cockfosters team on 020 3051 9430.