Browse Forums General Discussion 1 Apr 16, 2020 4:54 pm Hi everyone We were hoping to sign a building contract and start building by end of this year. Given the recent developments and the economic uncertainty, I was after some advice on what would be reasonable to negotiate with builders in terms of price? Where do we start? We've been told that if we delay the build until next year that building cost will increase. Not sure what to believe though. Thanks in advance. Re: Negotiating during COVID-19 2Apr 19, 2020 3:39 pm Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. Re: Negotiating during COVID-19 3Apr 20, 2020 2:56 pm alexp79 Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. Many thanks, my other concern is whether they actually WILL be around next year after we sign our building contract. How can they prove to us that they will be able to complete our build during these conditions? Re: Negotiating during COVID-19 5May 02, 2020 9:18 pm build2020 Hi everyone We were hoping to sign a building contract and start building by end of this year. Given the recent developments and the economic uncertainty, I was after some advice on what would be reasonable to negotiate with builders in terms of price? Where do we start? We've been told that if we delay the build until next year that building cost will increase. Not sure what to believe though. Thanks in advance. All the builder generally increase price every year. If you really like the builder and house plann, then just sign the contract. Remember go with reputed builder as small builder won't survive this financial distress. Re: Negotiating during COVID-19 6May 02, 2020 9:20 pm build2020 alexp79 Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. Many thanks, my other concern is whether they actually WILL be around next year after we sign our building contract. How can they prove to us that they will be able to complete our build during these conditions? Normally builder take construction insurance to guaranteed your build. Re: Negotiating during COVID-19 7May 02, 2020 9:39 pm Hussain sahara build2020 alexp79 Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. Many thanks, my other concern is whether they actually WILL be around next year after we sign our building contract. How can they prove to us that they will be able to complete our build during these conditions? Normally builder take construction insurance to guaranteed your build. Yes, but if builder goes broke, someone else would have to finish the build. Re: Negotiating during COVID-19 8May 03, 2020 1:49 pm Are you sure building cost will go down in economic recession? What about lack of supply increasing price of building cost, importing and transport of building materials from overseas will be extremely difficult. Its very easy for anyone to speculate whatever one wants to speculate and make a point. But who knows how it will actually impact the building cost! alexp79 Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. Re: Negotiating during COVID-19 9May 03, 2020 2:10 pm LoveHouse Are you sure building cost will go down in economic recession? What about lack of supply increasing price of building cost, importing and transport of building materials from overseas will be extremely difficult. Its very easy for anyone to speculate whatever one wants to speculate and make a point. But who knows how it will actually impact the building cost! alexp79 Tell them that building cost should go down at least 20% next year due to economic recession and lots of cheaper qualified labour available on the market. Materials cost should go down too because of the lower demand. Moreover, the builders should be ready to cut out on their margins and learn how to optimise their building process further. Those builders who want to stay up and running next year has to be super flexible towards offering better prices. It should, as due to lower demand, builders would have to start cutting their margins even if material costs increase, but it will be otherwise as material suppliers will be also cutting their margins due to lower demand to, in order to make their offers more competitive and attractive. Transportation and importing should not be affected, why? This is just the basic law of economics: when demand goes down, costs have go down too. If customers become picky and selective and start pushing builders for lower prices, the builders which will refuse to low down the prices will just be pushed out of the market. Re: Negotiating during COVID-19 10May 03, 2020 2:25 pm Given how hasty the builders are these days, building prices going down seems like a distant dream. on the other hand if they do go down, there will be definite drop in quality. The contractors may also start employing less skilful trades. IMO the prices may down for Established homes & Land sales rather than constructions. If one survives this pandemic without economic repercussion, it may be ideal for them to dive into property market. Re: Negotiating during COVID-19 12May 04, 2020 11:55 am Demand for residential home builders has been decimated recently and consequently the 'real' building prices will go down significantly. List pricing is just a guide because, like Bing Lee says, "everything is negotiable". If you are out and about look at the current petrol pricing as an example of this basic economic principle. Build quality should improve because the low quality 'bottom feeder' construction workers ( I won't call them tradesmen!) will be driven out of the market and builders now with fewer projects will be more choosy who they subcontract the jobs out to, and they will have more time to check their contractors workmanship that they didn't bother to do before. This is assuming they don't make too many construction management and back office support team members redundant. To check, ask the builder what redundancies they may have made recently. . The market advantage and negotiating power is now firmly in the hands of potential customers. Use this opportunity to make builders compete hard for your money with lower prices, better inclusions, better quality and fairer contract terms. Don't feel pressured to sign. If they don't cooperate just hold off and wait patiently until they do. Most building materials and labour are sourced locally. A builder's fixed overhead expenses will now be amoritised over fewer projects however, increasing the contribution that each needs to make. If a builder has recently raised their prices ask them to explain why, and let forum members know what they say... Re: Negotiating during COVID-19 13May 09, 2020 5:07 pm This is a very interesting thread for me. Like most other people I have taken a financial hit with Covid-19 but still looking to build later this year. I'm expecting a price from the builder soon with their standard inclusions. We do want a number of upgrades and I'm thinking that I will get better value from pushing for these to be included in the price rather than asking for a discount and then adding upgrades. Re: Negotiating during COVID-19 14May 09, 2020 5:34 pm Mojo and MjH just had a price increase. And user to offer 30k color voucher upgarde (their upgrades are very costly at color appointments). Now after the price increase they’re offering 45k off base-price with their new promo this week. According to my calculations it comes down to the same! With any builder, The best thing is to try negotiating to get the upgrades priced in the tender and any better offer on top off their “COVID” Promo!! theshack This is a very interesting thread for me. Like most other people I have taken a financial hit with Covid-19 but still looking to build later this year. I'm expecting a price from the builder soon with their standard inclusions. We do want a number of upgrades and I'm thinking that I will get better value from pushing for these to be included in the price rather than asking for a discount and then adding upgrades. Re: Negotiating during COVID-19 15Jun 08, 2020 10:48 pm LoveHouse McDonald jones home having a price increase from tomorrow. Hi do you have a copy of their prices as at 1st July 2019. As part of the new homebuilder grant, house prices should be the same eg 4 June 2020 and 1st July 2019. Obviously most builders increase their prices every year. Re: Negotiating during COVID-19 16Jun 09, 2020 9:21 am Thanks Khusnil we dont qualify for the grand from any angle anyway ☹️ khusnil.deo LoveHouse McDonald jones home having a price increase from tomorrow. Hi do you have a copy of their prices as at 1st July 2019. As part of the new homebuilder grant, house prices should be the same eg 4 June 2020 and 1st July 2019. Obviously most builders increase their prices every year. Can you give advice on how to get missing certificates needed for a form 21? Our bank requires us to provide one but we are missing 4 building certificates from our first… 3 71776 i would suggest nothing is unreasonable for PCI. we did all sorts, including checking the hot water, checking all the GPO's had power, testing that the showers were… 9 98623 Just to makea point about this, an approach that some people have found sucessful in negotiating these rises down, Is to provide some workings to the builder, specifying… 4 81664 |