Browse Forums Building A New House 1 Jul 29, 2014 9:58 pm Just wondering if anyone else thinks that the credits that builders give back to remove things are small compared to the cost to add things For example we are going to remove a wall and delete a multipurpose area and just enlarge the adjoining bedroom and they were going to give us $90 credit for this. But they are charging us almost $700 to add a similar sized wall elsewhere. Why the price difference. My friend is going to delete one of her bathrooms, and just got told she wont get any credit for that, but it will cost her $200. Whereas we are adding a similar size bathroom to what she is removing and have been quoted 7500 to add it. Is it just me, or do others feel we are constantly being ripped off? Re: Why are the credits given so small to remove things.... 4Jul 29, 2014 10:38 pm My husband's favourite complaint is "gold value in, scrap value out". Challenge it. You never know when an "error" might be amended. http://www.housebythewater.wordpress.com From blank block to new home in Mandurah, Western Australia. viewtopic.php?f=31&t=65564 Re: Why are the credits given so small to remove things.... 5Jul 29, 2014 10:39 pm housebythewater My husband's favourite complaint is "gold value in, scrap value out". Challenge it. You never know when an "error" might be amended. Love the saying Re: Why are the credits given so small to remove things.... 6Jul 30, 2014 12:30 am Double check on it, as added glass balustrade to our balcony which came in at $6000, our rep double checked and found he hasn't given us enough credit back, our glass is now $500 Our build thread: https://forum.homeone.com.au/viewtopic.php?f=31&t=70984 Re: Why are the credits given so small to remove things.... 7Jul 30, 2014 1:32 am Yep, I have checked a number of items and found that several times the credit for the item being removed was not given. I also rang the supplier of the materials on several occasions and saw that the price differential was no where near as much and the upgrade price was reduced. I think that builders will give in on some and stand firm on others so that overall profitability is still what they expect to make. I had a very long list of changes so I am sure that some of the items I am being skinned and some skinned less.... I got told that it is a standard credit of 250 when we take a window out, so i said fine, lets put some in. When the sales person explained that the charging doesn't happen that way I then explained that I would like a full costing on all items before I sign anything as I wished to validate all prices. This draws out the process big time. I don't think I will ever understand. I like the "we can use our buying power" line and then they charge you 20% more than RRP. Re: Why are the credits given so small to remove things.... 8Jul 30, 2014 7:37 am When a builder adds something on, they add it at retail plus their stated profit-margin; usually 20%. To cover the cost of admin they're undoubtedly also adding the cost of getting the estimator to put that cost together. However when a volume builder buys something standard, they buy it at a discount. So when you take something standard out, they're only going to return you the discounted cost of whatever-it-is, 'cos that's all they'd be paying if they installed it. Plus there's going to be an admin cost to the builder in removing something that's already in the plans and/or contract or tender. The gap between a discounted price and retail+20% can be quite large. Especially with a really large builder who's probably negotiated great discounts 'cos they go through so much building material. *edit* And of course, when they don't want to do something they'll also quote extra to discourage you ... Re: Why are the credits given so small to remove things.... 9Jul 30, 2014 10:16 am @Forg, I understand what you are saying but there are many instances where they actually buy-in at much cheaper rates and still charge you RRP+20% which is what is annoying. They should be able to offer the sort of discounts that I could achieve from any walk-in bricks and mortar shops. They do not even have to carry inventory. In fact I would be happy if the % was even close to the prices that I can achieve and they should be able to profit on that. Not trying to sledge the building companies or anything but I think that they are very inefficient in how they do their estimating and sourcing etc. There is definitely room to improve theirs processes and systems...... maybe this is all part of the "wear you down" process. Re: Why are the credits given so small to remove things.... 10Jul 30, 2014 11:56 am @ Forg I totally understand what you are saying...but still so unfair they don't give the full credit that they would charge if you were adding the item...guess all I can do is question them on it...am more annoyed for my friend who is receiving no credit at all for removing a bathroom...she is not even getting the cost of the materials back Why are the credits given so small to remove things.... 12Jul 30, 2014 8:41 pm Crazyk Nope they are all the same. I agree. I'm not bitter or anything or burned by any past experience but I just find the whole builders pricing/mark-up laughable. I don't think there's anything anyone can do other than question/challenge prices with their builders and see what happens. I had my tender the other day and I had brought my quote with me to compare the prices for items to see if they'd increased or decreased any of what was on the quote. Naturally, nothing was decreased. It was either exactly the same as the quote or higher. There were a couple of things that I questioned - one item was $3 more and the other was $1 more. When I asked about one item being $3 more the tender presenter didn't say anything other than he'll just change the price. Then when I got around to asking why the next item was $1 more he said, "It's just a dollar..." I just looked back at him and said, "Yeah?" What I really wanted to say was, "If it's just a dollar then why couldn't you guys wear the difference?" Now, I wasn't trying to save $4. I really just wanted to know why the prices increased. Like, has that much changed in the last six weeks when I first signed up to build that they really felt the need to increase the prices by a few dollars? If there is 100 items on your tender list and they added $1 to each item that's $100 right there. Multiply by 100 clients that's $10,000. Multiply by 1,000 clients that's $100,000. Just saying... 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