Always Check Your Builder

AUSTRALIAN BUILDER LICENCE SEARCH

Always Check Your Builder's
contracts caution checklist
for Australian home building & renovations

Our background checks reveal risks that a licence search can't

Always Check Your Builder also provides the background checks necessary for you to discover the credit, trading and complaint or dispute status of your prospective builder.
read more ...

you've searched and found out ...
He's given you 2 brilliant references and his licence checks out

Always Check Your Builder searched and found out ...
3 of his building jobs last year ended up in the courts but yes 2 were perfect.
His truck's been repossessed and he's got 2 defaults against his equipment leases.
His company hasn't filed a tax return in 2 years and his partner is banned from holding a builders licence.
Between them they've had 3 building companies go into liquidation and a heap of sub-contractors won't work for them anymore.

IT'S YOUR CALL
alwayscheckyourbuilder.com.au

Contract Caution

What is fixed price

A "fixed price" contract is the easiest to understand, but it is not always possible for a builder to offer a fixed price, nor is it always to the client's advantage.
If you've been given a fixed price quote, for example, ask the builder for a cost plus quote and compare the two.
Fixed price contracts are often higher than cost plus contracts because the builder adds a "buffer" for some costs they can't fully anticipate ahead of time.

What is cost plus

"Cost plus" contracts agree to reimburse the contractor for all expenses incurred during building (labour, materials, outside subcontractors, etc) plus a fixed percentage of the cost or a fixed fee.
A cost plus contract should include:
An estimated price
A timetable for reporting costs
And an accurate means of tracking labour and materials cost.
Seek legal advice if your builder asks you to sign a cost-plus contract (where the builder charges by the hour and you do not have a fixed price).
Cost-plus contracts are only allowed for renovation projects worth over $500,000, and then only in very limited circumstances.

What is design and construct

A "design and construct" (D&C) contract includes costs of both designing and constructing a building or home addition.
It can be either a fixed price or cost plus contract.
D&C contracts often also include "prime cost" items such as lighting fixtures and kitchens.
These can be adjusted if the owner later decides to get more or less expensive prime cost items.
Some D&C building contracts also include "rise and fall" clauses to cover the fluctuating prices of materials and labour.