Browse Forums General Discussion 1 Jul 21, 2011 9:53 am We are in the process of getting quotes from builders for our new home which we have designed ourselves. As such, we have had drawings done for the builders to price from. I have been hearing some stories recently where builders provide an estimate and will then revise that estimate up once you have put down your deposit. At risk is the 5% deposit or potentially $20K plus in our case if the the price comes in significantly higher and over our budget and we then can't afford to go ahead. Can we when putting down our deposit with the builder, include a clause such as the following: This deposit is paid subject to the contract price being within 2% of the budget price provided by your office. If the contract price exceeds this amount we reserve the right to not proceed with the contract and will be entitled to a full refund of our deposit. My understanding of contract law is that the last piece of paper rules, meaning that if they accept the deposit and do not reject this clause in writting then the clause is accepted and therefore part of the contract. Am I right and can I do this? Thanks Re: Contractual Question re Home Deposit 2Jul 21, 2011 10:39 am You can ask for anything you like, but whether any builder will accept is another thing. IMO: 2% is very little margin for error and in my experience your contract price will blow out by some figure. You will just have to find the extra money somewhere. Things like foundation and site costs always change. As a guide, allow $10k per Sq of building you want. So if 5% is $20k you have $400k to spend? Does that include all site works, connections, stamp duty if applicable and all floor coverings etc? Remember that you don't get things like curtains included and some don't include non wet area floor coverings. Also you'll probably want to upgrade things like kitchen appliances, light fittings, add extra power points and change taps etc... It all adds up. You should be seeking legal advice to clarify whether the clause you want will stand up in a court as well. The builder may accept it but if its not properly written then its not ev3n worth the ink. (My last employment contract was deemed illegal in some of its clauses and therefore was deemed not to stand. I had 5 clauses removed and agreed to waive one other at employers request. I did very well out of that piece of legal advice. $500 well spent IMO) Re: Contractual Question re Home Deposit 3Jul 21, 2011 2:18 pm Site costs are always going to blow out + PA's. Also, what happens when you overspend at Colours, Kitchens, Electricals? You have to remember that the displays often include upgrades. Our electricals came in at $13K over the tender (why? we added 70 LEDs, extra powerpoints, etc etc). Tiling won't be floor to ceiling so we paid $7K for this (3 Bathrooms). Kitchen we probably spent $25K over the tendered amount.. All in all you're probably looking at spending 60-100K on flooring, tiling for bathrooms, electricals, demo (if you need to), kitchen upgrades etc. Re: Contractual Question re Home Deposit 4Jul 21, 2011 3:31 pm my DH wanted to add something like this in the contract and our builder said no. Post- contract signing we've had additions to the cost by exceeding our allowance for piering (which you don't find out until the day the concrete is poured) and for additions/alterations that council stipulate due to BASIX. Even though you are signing a fixed price contract, expect the price to increase. Land at Chermside At tender stage In NSW the maximum deposit for building work is 5% until the builder provides HBCF insurance 1 4821 What you are looking at is fibrous plaster, true gypsum, it is cast on horizontal beds with fibers included to give strength. I has no Asbestos in it. Houses before 1985… 2 7136 We already paid for somfy motors for the blinds. The quote above was purely for “pre-wiring” so the blinds company can install the motors and blinds. That’s why we… 5 16268 |