Browse Forums Building A New House 1 Sep 05, 2009 9:26 am I dont want to say good or bad about the builder but definetly want anyone who is considering ********* builder to read through what tectics they practice to increase their margin of profit
As we are building to take advantage of first home owner grant so we are pretty tight on our budget but our builder gave us a piece of shocking news only e week away from construction he called up to say that your house price has been raised by $14000 without any explanation (only applicable to our house not to any other he was building in that area). He pretty much knew by that time we are literally stuck with him but this a sheer act of blackmailing and dishonesty. their act may be legally wrong but is an example of pure greed and manipulation.this is just the begging i am scared to death to even think of what ****** ahead
Re: tactics used by builders to increase their margin of profit 4Sep 05, 2009 11:51 am Check with your states consumer watchdog and ask if its legal. Im pretty sure they can only increase the cost of provisional sums. But if the price is increased by 10% you can rip the contract up. Not 100% sure though. Re: tactics used by builders to increase their margin of profit 5Sep 05, 2009 12:03 pm My understanding is that they can only increase the costs after contract if it is unforeseen circumstances - and the onus is on them to show it was - for example something unavalaible from their suppliers, a new council regulation requiring something extra not in place at time of signing etc. $14000 is a very large amount - they need to be able to justify why such an increase. I agree with eXume, I would be seeking legal advice. Re: tactics used by builders to increase their margin of profit 6Sep 05, 2009 6:13 pm thanks for all the support actually my scenario is a little different i will try my best to explain everything. we are building in pemulwuy which is a new estate near parramatta. we signed the tender at somewhere in january and at that time we and the builder very well knew that the construction wont start somewhere before august or september which stands true for all other houses in that estate.( coz the land was still under preparation). the plans went with the council even before we settled for the land and and we paid them the advance money of $5000. but the actual contract was signed only on 15 july . last week we got the DA approval and we were ready to start next week yesterday they called and informed that it is no more profitable for them to build our house so we will have to pay more $14000 . (does not apply to any other house they are building in the same area) and explanation given to us is that they can increase the price any time after 120 days of signing the tender not contract . we know very well they were just waiting for the DA approval becuase now if we come out of the contract we will lose the
Re: tactics used by builders to increase their margin of profit 7Sep 05, 2009 7:12 pm If it was me I would ask to speak to the person at the top and ask for an explination as I dont see how you can increase the price just because they havent done their sums correctly. There is no way I would be paying and I would tell me that I will see them in courtt if they dont honor the contract Re: tactics used by builders to increase their margin of profit 8Sep 06, 2009 9:24 am we have already talked to the top person and they said we are ready to terminate the contract if we dont agree to pay additional sums can somebody suggest any property dispute lawyer in sydney???? Re: tactics used by builders to increase their margin of profit 9Sep 06, 2009 9:40 am Contact the Office of Fair Trading, pronto. It seems very strange that any builder can increase the price after signing of the contract ...go back and read all your paperwork and check that there's no clause that allows them to do this. This doesn't relate to site costs, does it? Increases due to rock removal or other unforseen circumstances relating to preparing the site are usually allowed for in your contract, so read it carefully. Re: tactics used by builders to increase their margin of profit 10Sep 06, 2009 10:22 pm As kek said, get in contact with the Department of Fair Trading. In my book, you should be able to proceed without any cost increase. Demolition August 2009, Construction Started September 2009, Completed December 2010 Re: tactics used by builders to increase their margin of profit 11Sep 06, 2009 10:59 pm My friend, I feel for you and your situation. I was in a similar one myself. If you where in Vic. I would say by signing on the 15th of July you got the extra grant money but I think it was for Vic only so that’s no consolation to you. Mate, I agree totally, unfair. You are correct you are in 5k deep now. Consider your options, if you walk away do you looses the 5k or only sum of it? Consider also the FHOG will finish soon, so you may not get a new contract to get the FHOG in time. I feel you may have a case under Fair trades Act. As their actions may have been deceptive and it was implied you would get the home for the same price. Your call, but get the proper legal advice first. Get the solicitor to call them and get an explanation why. Unfortunately legal advice cost money but in this case it may be worth it. I hope you can sort it out, I feel you can and will be OK. All the best & let us all know how you went. KW……………. “It's just as unpleasant to get more than you bargain for as to get less” George Bernard Shaw. Re: tactics used by builders to increase their margin of profit 12Sep 08, 2009 8:33 pm asked them to give the reason in writing but nothing tiil now and stll losing money everyday as far as the site costs are concerned they have already charged 7k but that was standard to all the houses so reasonable but this is so frustrating damn these builders!!! Re: tactics used by builders to increase their margin of profit 13Sep 08, 2009 10:26 pm My friend who was building with Mirvac (about 2 years back) had the same situation. By the time everything was finalised and got the DA it was already 5 months, long over the 3 month tender price period .. and they increased by $7K.. Anyways, he tried all out but they didn't agree to progress build at the original price .. following the contractual dispute process (its always listed as a clause in the contract) he did whatever with the company .. and then went to DFT .. (dept of fair trading) .. they did intervene, and after all that he paid something like $3K to settle the dispute and move ahead .. I think he argued not for the figure 7K, but the fact that this could be ANY figure and he cant pay them ANY $ more just because things have changed or materials are more expensive now.. He signed up with this builder knowing they would build it for him for X amount of dollars, if it was X+7K, he would've gone with another builder etc etc.. Make up a case and go to DFT.. believe me builders want to stay away from DFT because they waste so much of the builder's time that its useless against the increase they're asking you to pay .. Hope this helps .. (btw i live in the units at Pemulwuy, but unfortunately not building there.. but i loveeeeee the area!) --- I don't have a signature - just this sentence saying that I don't have one - that'll do! Re: tactics used by builders to increase their margin of profit 14Sep 10, 2009 7:59 am thanks for the help now at this moment we are left with no other option but to go to fair trading. another piece of shocking news we received yesterday that they miscalculated something else as well so our price will go up by another 5K at this moment A week before we could see the house starting any moment but now all this seems so far away. we also fell in love with the area the first time we saw it my only hope is that all this turns out be worth in the end. Re: tactics used by builders to increase their margin of profit 15Sep 10, 2009 12:37 pm just got a call from the builder threatning not to build for us if we dont pay additional 19K. 14K---no explanation and 5K--their calculation mistake(called us literally dishonest not telling them about the calculation mistake) just imagine their audacity.dont know what to do. Re: tactics used by builders to increase their margin of profit 16Sep 10, 2009 12:42 pm If i were you i'd be backing out immediately, and put down the loss of the $5000 as a *learning experience*. viewtopic.php?f=31&t=22766 - my build thread! Time waits for no man. Unless that man is Chuck Norris. Re: tactics used by builders to increase their margin of profit 17Sep 10, 2009 12:49 pm but what about the 24K grant Re: tactics used by builders to increase their margin of profit 18Sep 10, 2009 12:56 pm That would be something you'd have to decide. Is it really worth all the stress going with this particular builder just so you can get the FHOG before it runs out? Especially if they keep adding additional costs? or Do you just say No. Spend another year saving up until you can go through an alternative builder (or buy an already established home). Its a tough decision to make, but for me personally? I wouldn't be putting up with a builder who kept increasing costs. Best of luck with your decision. I hope it all works out in your favour. viewtopic.php?f=31&t=22766 - my build thread! Time waits for no man. Unless that man is Chuck Norris. Re: tactics used by builders to increase their margin of profit 19Sep 10, 2009 12:57 pm After 30/09/09 you would still still get the $14,000.00 federal grant, plus in NSW you guys get $3000.00 from the state gov don't you? So that's still, $17,000.00, if i were you I'd be ringing around a having a chat to some other builders - unfortunately you're in a sh*t situation, and I feel soooo much for you Don't give up until you've explored all your options under the circumstances it may also be nice to have a fresh start... 2014 - Prepping to build the Soho 4 with Plantation homes, industrial style 2009 - Built the Brampton with Coral Homes viewtopic.php?f=31&t=15399&start=280 Re: tactics used by builders to increase their margin of profit 20Sep 10, 2009 12:59 pm I can't offer any advice re the DFT, but it may be worthwhile to contact Stockland. If it is a stockland subdivision, and they have several builders with rights to build then i'm sure they wouldn't be happy to hear that the builders are treating their clients like this. The builders are more likely to be concerned if stockland start questioning their integrity. i'm sure they wouldnt want to promote or associate with builders that may deter potential land purchasers. I hope it works out for you. 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 81858 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 29842 How are you doing Ben? Extremely interested in hearing what you are doing or plan to do! 12 15200 |