The Home Building Contract Negotiation – ADD VALUE , SAVE MONEY

A friend of one of my business associates was building a multi million dollar home in Sydney.

They had negotiated a price and time with a builder (who was highly recommended by a friend as a nice bloke), however knowing they were about to sign a substantial building contract and no real knowledge of what of their real obligations and risks, they asked me for a second opinion.

I met with them and their builder and we just went through the contract concentrating on its key elements. They had sorted out the money and time and yet the contract did not clearly defined what they were getting for their money and who was taking the risks for changes.
Yes there was a set of 10 basic drawings and the price included a trade cost breakup of 12 items from demolition to concrete to painting etc. However it was very open as to what the final result would be and who would pay if there were misunderstandings.

It became obvious at the first meeting that the builder had one idea and they had another on some key items.

So I set up a series of meetings with the owner and builder. We went through each item of cost and defined what was being offered, and who was taking the risk. This process took about 3 weeks.

It was a slow process, however it provided a framework to remove much of the doubt over what the builder was doing and what the home owner was getting.

The building contract they eventually signed for around the same amount of money and time however it included more drawings, a more detailed cost breakup noting Prime Cost Item allowances, a building time program and most importantly a schedule of the internal finishes for each room.

We  removed the misunderstandings and reduced the likelihood of cost and time blowouts.

Every one was a winner.

The builder was able to build the project quicker as he didn’t have to wait for decisions.

The home owner had the home built and finished the way they expected and didn’t have to pay for cost variations along the way.

If you are building or renovating, spend a little extra time at the start of the project clearly defining your project brief with an experienced independent building professional.

George Birdsall offers that service to you either in person or via the internet. He can make a real difference to the smooth running of your project.