Browse Forums Building A New House 1 May 28, 2018 4:32 pm Hi Everyone, I'm new to the forum and was hoping that some of you good folk with more experience with the building process would be able to offer some assistance. We're at the start of the process (feels like we've been doing this for so long though!) where we've been through prestart, signed the contracts, building permit granted and about to pay the first invoice. We signed the pre-construction documents in Oct 2016 and settled on the land in June 2017. It's taken us this long to save the deposit prior to going into prestart and because of this, our builder Aveling is saying that the house needs to to go through their valuations team again. Fair enough, I know that prices increase and decrease and we waited over 12 months before going into prestart. My question is that we've signed all the contract documents last month and they've come back to me saying that they've valued the contract at $2k more than what we signed and have issued a variation for the additional cost. Is this standard practice?? I would have expected that they can do this prior to the contract has been signed but after seems a bit dodge to me. Also, there's no transparency to the price increase so they could be making it all up to line their pockets as far as I know. Thanks in advance. Re: Building Contract Increase in Price - Is This Common? 2May 29, 2018 7:53 pm KayaPB Hi Everyone, I'm new to the forum and was hoping that some of you good folk with more experience with the building process would be able to offer some assistance. We're at the start of the process (feels like we've been doing this for so long though!) where we've been through prestart, signed the contracts, building permit granted and about to pay the first invoice. We signed the pre-construction documents in Oct 2016 and settled on the land in June 2017. It's taken us this long to save the deposit prior to going into prestart and because of this, our builder Aveling is saying that the house needs to to go through their valuations team again. Fair enough, I know that prices increase and decrease and we waited over 12 months before going into prestart. My question is that we've signed all the contract documents last month and they've come back to me saying that they've valued the contract at $2k more than what we signed and have issued a variation for the additional cost. Is this standard practice?? I would have expected that they can do this prior to the contract has been signed but after seems a bit dodge to me. Also, there's no transparency to the price increase so they could be making it all up to line their pockets as far as I know. Thanks in advance. I haven’t been in that situation but I think it’s a bit weird they didn’t add the increase into the base house price did you have any old documents from when you first signed in 2016 to say what the base price was then compared to now? We had an issue with our land cancelled our first land contract and bought a new lot but there was a price increase on the PCQ for our home and it was clearly explained, I would recommend speaking to someone higher up if you can hope you manage to sort it out 😥 Re: Building Contract Increase in Price - Is This Common? 3May 30, 2018 7:18 am Not sure about the price increase after signing the contract, but this price increase sounds about right. We signed with Coral and paid deposit in May 2017 and they hold the price for 7 months for a build start date. Our land didn't register until November 2017 and as our house wasn't due to start until April 2018, we ended up with the price from September 2017 which was $1000 more. We didn't sign our contract until January 2018 and the new price was included in the contract. Re: Building Contract Increase in Price - Is This Common? 4May 30, 2018 10:58 am vanessah2015 KayaPB Hi Everyone, I'm new to the forum and was hoping that some of you good folk with more experience with the building process would be able to offer some assistance. We're at the start of the process (feels like we've been doing this for so long though!) where we've been through prestart, signed the contracts, building permit granted and about to pay the first invoice. We signed the pre-construction documents in Oct 2016 and settled on the land in June 2017. It's taken us this long to save the deposit prior to going into prestart and because of this, our builder Aveling is saying that the house needs to to go through their valuations team again. Fair enough, I know that prices increase and decrease and we waited over 12 months before going into prestart. My question is that we've signed all the contract documents last month and they've come back to me saying that they've valued the contract at $2k more than what we signed and have issued a variation for the additional cost. Is this standard practice?? I would have expected that they can do this prior to the contract has been signed but after seems a bit dodge to me. Also, there's no transparency to the price increase so they could be making it all up to line their pockets as far as I know. Thanks in advance. I haven’t been in that situation but I think it’s a bit weird they didn’t add the increase into the base house price did you have any old documents from when you first signed in 2016 to say what the base price was then compared to now? We had an issue with our land cancelled our first land contract and bought a new lot but there was a price increase on the PCQ for our home and it was clearly explained, I would recommend speaking to someone higher up if you can hope you manage to sort it out 😥 Thank you. I'm arranging to speak with management at Aveling. We do have the documentation to show the base price. I have no issue with them increasing the price, all i'm after is a proper explanation as to why. Glad to see that it does happen but there are some companies that would provide you with the explanation In my case, all we got was 'the price has increased'. When I asked for an explanation as to why, they couldn't provide it to me. Also, when I queried as to why this was happening after the contracts have been signed, again no explanation. Something just doesn't seem right. Which is a shame because we really like the house that we settled on! Re: Building Contract Increase in Price - Is This Common? 5May 30, 2018 11:04 am bestspecials Not sure about the price increase after signing the contract, but this price increase sounds about right. We signed with Coral and paid deposit in May 2017 and they hold the price for 7 months for a build start date. Our land didn't register until November 2017 and as our house wasn't due to start until April 2018, we ended up with the price from September 2017 which was $1000 more. We didn't sign our contract until January 2018 and the new price was included in the contract. Sounds like a similar situation to me, except your price increase was included in the contract which is what I would have expected. I don't mind an increase, I'd just like it if they could justify it to me. e.g., increase in material cost etc. Also, I don't like that it feels like i'm being bullied into signing a variation for an unjustified price increase. Hope your build is going well Re: Building Contract Increase in Price - Is This Common? 6May 30, 2018 11:09 am KayaPB Unfortunately that is standard Even though you signed the contract any delay/costs outside the builders control are added as variations up until the work commences on site.. this should have been explained to you? Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Building Contract Increase in Price - Is This Common? 7May 30, 2018 11:14 am KayaPB bestspecials Not sure about the price increase after signing the contract, but this price increase sounds about right. We signed with Coral and paid deposit in May 2017 and they hold the price for 7 months for a build start date. Our land didn't register until November 2017 and as our house wasn't due to start until April 2018, we ended up with the price from September 2017 which was $1000 more. We didn't sign our contract until January 2018 and the new price was included in the contract. Sounds like a similar situation to me, except your price increase was included in the contract which is what I would have expected. I don't mind an increase, I'd just like it if they could justify it to me. e.g., increase in material cost etc. Also, I don't like that it feels like i'm being bullied into signing a variation for an unjustified price increase. Hope your build is going well Our build is going great. I regularly went onto the Coral website while we were waiting to see how the prices were increasing. So, I already knew we were going to have an increases. I was just happy that they backdated the pricing to September 2017. Did they say at any time how long the price remained valid. If they did ask them to backdate the price by that many days rather than at todays cost. Re: Building Contract Increase in Price - Is This Common? 8May 30, 2018 11:38 am StructuralBIMGuy @KayaPB Unfortunately that is standard Even though you signed the contract any delay/costs outside the builders control are added as variations up until the work commences on site.. this should have been explained to you? Thank you. I accept if it's standard practice, and I wouldn't expect the builder to wear costs that were outside of their control. I asked them for a reasonable explanation for the cost increase and they are yet to be able to provide it. The explanation given to me was that because it has been so long, they sent the house back to the estimators. I question why this was done AFTER I signed the contracts and not before, and also to let me know the reason for the price increase. No reason was provided other than, 'it just increased'. I know i'm new to building but that seems quite unreasonable to me! The sales consultant didn't explain this to me, perhaps an oversight on her part? Re: Building Contract Increase in Price - Is This Common? 9May 30, 2018 11:42 am bestspecials KayaPB bestspecials Not sure about the price increase after signing the contract, but this price increase sounds about right. We signed with Coral and paid deposit in May 2017 and they hold the price for 7 months for a build start date. Our land didn't register until November 2017 and as our house wasn't due to start until April 2018, we ended up with the price from September 2017 which was $1000 more. We didn't sign our contract until January 2018 and the new price was included in the contract. Sounds like a similar situation to me, except your price increase was included in the contract which is what I would have expected. I don't mind an increase, I'd just like it if they could justify it to me. e.g., increase in material cost etc. Also, I don't like that it feels like i'm being bullied into signing a variation for an unjustified price increase. Hope your build is going well Our build is going great. I regularly went onto the Coral website while we were waiting to see how the prices were increasing. So, I already knew we were going to have an increases. I was just happy that they backdated the pricing to September 2017. Did they say at any time how long the price remained valid. If they did ask them to backdate the price by that many days rather than at todays cost. The fix the price for 180 days. we didn't sign the contract until over 300 days afterwards so I accepted the risk that the price could be increased. I just also expected to be provided with a reasonable explanation for the price increase. The lack of transparency is not something i'm used to. I make a living developing high value and high risk contracts and the ability to increase prices after the contract has been signed with no proper justification is ridiculous. Re: Building Contract Increase in Price - Is This Common? 10May 30, 2018 11:47 am Unfortunately the contract favours the builder..they don't have to tell you anything As for the new homes sales consultants (on huge commissions) they should have a royal commission on them too and clean up the Industry, why stop at banking and super It's in your interest to hassle the builder every week until they start on site. goodluck Designer,Engineer (Civil,Const & Envir),Builder,Concrete & Masonry Contract.Struct Repairs Re: Building Contract Increase in Price - Is This Common? 11May 30, 2018 11:59 am Unfortunately, all the builders we spoke to said that they only hold the price for a certain period. I would have to imagine that after 10 months, there is definitely price increases. $2000 actually sounds pretty good. I just looked at the Coral website and the price from May 2017 to May 2018 has gone up by $4700 over the 12 months. But, like I said, we were able to lock the price in for September which was only $1000 more. 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 81724 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 29717 How are you doing Ben? Extremely interested in hearing what you are doing or plan to do! 12 15168 |