We have been engaged with custom builder in pre-contract phase till now,
and communication has been good and timely, with some delays in drafting
due surge in demand (Federal Home Builder Grant!).
We've been just issued with contract documents last week, and I have a few
questions, that is concerns. Looking for some guidance / information whether someone
has had similar contract changes issued to them. Contract is standard HIA contract, (location: VIC)
however there are some changes that stood out to me
- Change in dynamic of payment to
5% (deposit) -> 15% (slab) -> 25% (frame) -> 25% (lockup) -> 20 (fixture) -> 10% completion
This is deviation from standard in terms that 10% from lockup have been flipt to earlier frame stage,
and 5% from fixture has been flopped to slab stage, so 15% more up to lockup. This may be justifiable
with the fact the house is double storey.
- Change in definition of the stages to following
"""
- 'Lockup Stage' does not include installation of garage door, fitting of any weatherboard cladding cement sheet infills .
'Fix Stage' includes the fitting of any weatherboard cladding or cement sheet infills and all external hinged doors but does not include built-in shelves, baths, basins, troughs, sinks garage panel/roller door .
'Final/Completion Stage' includes all built-in shelves, baths, basins, troughs, sinks, cabinets cupboards .
"""
So effectively, asking more money in advance with allowance to be late with the some works by tweaking definitions.
- Most concerning is requirement from the builder to sign a charge on the land with the contract (allowing them to place caveat on it) in relation to any monies owned by the contract. I heard some builders do this, but even HIA does not recommend it as any caveat may not be effective af the land is mortgaged by the bank.
I would be very grateful if anyone could share if they had similar clauses in their contracts,
as generally this seems like stepping away from standard contracts in a way which is highly favourable
to the builders, and legally speaking potentially very dagaing for ourselves. What is encouraging is that builder is
not pressuring is in signing and wants to make sure we read it all through and understood, and also we got some
pretty good references for them in regards to quality of the build.
Thanks in advance πππ