Browse Forums Building A New House 1 Nov 22, 2022 6:54 pm Building a house on a small 250m2 lot in WA. Contract signed for small single storey fixed cost build of 165m2 with a building contract at $220k which includes site provisions of $20k in July 2021. Building with a large project home builder. Took 18 months to arrive at the post prestart stage. I was told by the sales consultant a week ago that they only found out recently that certain items need to be actioned and now the site works will cost $70k. The thing is only $15 – 20k of that are things which is due to the site. Everything else would be things that they would have known or foreseen. It seems extremely unfair as I would not have signed the contract if it was this price. They are also springing this on us just before they apply for the building permit. I don't even know if I can get the additional finance. Does anyone have any advice or have gone through something similar and can advise how it all went down? Re: Site works - Unfair Increase? 2Nov 23, 2022 7:49 am Hey Jaakar Welcome to the forum The Building Commission WA has already warned Battlers about New Home Salesman and PPA Agreements I suggest you lodge a complaint with them. In a nutshell the PPA isn't a building contract 1. It forms a basis for the contract AFAIK not enforceable by the home owner. 2.The coloured presentation sales renderings are just a hook to entice you to develop the concept further at PPA. I might add at considerable cost if things start going wrong with the siteworks, engineering ,etc 3.Salesman are great at extracting incremental additional deposits and price increases to the point where most can't back out without loosing their 5% deposit 4. Just before they turn the thumb screws on you, the salesman goes MIA and you are cast adrift 5. The salesman and builders know there is no contract until work actually starts on site, that's is why they hit you with the price increases and give you the option to pay up or pull out and you pay the builders costs thus far. 6. In hindsight there are a number of things you could have done to protect yourself , but unfortunately it's a bit too late now. get legal advice Better luck next time. Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Site works - Unfair Increase? 3Nov 23, 2022 10:50 am Definitely a lesson learnt. I am interested in point 5 of your post that states that there is no contract until work actually starts on site. What would be the builders cost thus far if it is only at the prestart stage? I am exploring all options at this stage. Re: Site works - Unfair Increase? 4Nov 23, 2022 12:03 pm Jaakar Definitely a lesson learnt. I am interested in point 5 of your post that states that there is no contract until work actually starts on site. What would be the builders cost thus far if it is only at the prestart stage? I am exploring all options at this stage. there most definitely is a contract, once you've signed it and any applicable cooling off periods have passed. what he meant to say is that most standard contracts are heavily favouring builders, and there are many clauses in it that allow them to delay the start of construction as well as increase the costs without being in breach of the contract Re: Site works - Unfair Increase? 5Nov 23, 2022 12:53 pm If there is no Building permit issued... How can there be a Building contract? Hey Jaakar did the salesman discuss the cooling off period for the PPA and refunds? Builders have taken a leaf from architects pricing Book Planning Costs with colour fake renderings (humour) 3-5% of the contract value guessing $10K? The more they extract the less likelihood clients will withdraw PPA Costs would be a question that you should have asked the salesman when you signed the Builders form. Goodluck Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Site works - Unfair Increase? 6Nov 23, 2022 1:30 pm The contract will usually specify that if a building permit is not issued within 60 [or another number] of days from contract signing, either party can terminate it. This is the same provision that provides for the builder to be paid for work done up to the termination date. But there is a contract in place from signing (subject to cooling off periods). Re: Site works - Unfair Increase? 7Nov 23, 2022 1:53 pm Thank you everyone for you replies and advice. Contract signed date until now has been 400+ days. Seems like both parties have a right to terminate. I've heard some horror stories of builders requesting $30k plus to terminate... I've only paid $5k in deposit so I wonder how they will get the rest out of me if I do go down that road... Re: Site works - Unfair Increase? 9Nov 23, 2022 6:21 pm Jaakar ... I've only paid $5k in deposit so I wonder how they will get the rest out of me if I do go down that road... Did you pay the $5k at the PPA Stage? If answer is yes, then any additional changes there after are variations and you may be up for costs. hth Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Site works - Unfair Increase? 10Nov 23, 2022 6:44 pm Jaakar Thank you everyone for you replies and advice. Contract signed date until now has been 400+ days. Seems like both parties have a right to terminate. I've heard some horror stories of builders requesting $30k plus to terminate... I've only paid $5k in deposit so I wonder how they will get the rest out of me if I do go down that road... Just to clarify, we are talking about an actual contract that went to the bank to obtain finance etc? 5k deposit seems to be pretty small, usually it would be 5% once the finance is approved. Re: Site works - Unfair Increase? 11Nov 23, 2022 7:01 pm Yep only paid $5k at the PPA stage and they did not ask for any more money after that. Did not know that this was abnormal. Also, some variations were actioned after the building contract signed but only due to items that were clarified as required at the PPA stage was missed. I think I will consult a construction lawyer. Not sure which route I will take but need to know my legal rights and obligations. Re: Site works - Unfair Increase? 12Nov 23, 2022 7:16 pm I wouldn't worry about what happens in other states, mate. The PPA deposit may not cover all the builders costs, variations and fixed/locked in the price as you have found out WA is very different. Contact the WA building commission Goodluck Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs I believe that liquidated damaged should be amount of actual loss to the owner from the delays. The issue in all of this is building industry lobbying and contributing to… 5 3467 Fair Trading can issue orders to rectify and complete but once the matter goes to NCAT these orders are automatically vacated. You will have to terminate contract and sue… 21 29826 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 81835 |