Browse Forums Building A New House 1 Jan 18, 2014 11:18 pm hello.. I am currently at the initial contract stage and is building with a reputable volume builder. When they provided the prices after Colour selection, I have noticed that some items have a price much higher than I anticipated. The item in question is a kitchen sink. I am already getting a sink by default(guessing it to have at least 300-400 AUD value). When I have requested an upgrade to a model which is having an RRP of 1300 AUD(available for 900 AUD if I am buying directly from outside), the builder charged me around 1550 AUD, that too in lieu of the default sink. While I can understand the builder taking a reasonable margin, I feel that this is a bit over the roof. What are the rules? Can the builder just add any margin? Or are they bounded by some rules that the margin should be within x% of the RRP? Its my first house and I need some advice.. PS: I tried searching; but couldn't pin point any exact topic covering this. Re: Maximum margin that a builder can take over RRP 2Jan 18, 2014 11:41 pm Just try not to change too many things, I changed the color of floorboard, it was $1000, guessing that's how/where they make easy money... only changes things that you really have to change and would cost too much to change after handover... Re: Maximum margin that a builder can take over RRP 3Jan 18, 2014 11:45 pm When we built upgrades were 20% above RRP!! First of all I try not to pay RRP and I know they aren't and second 20%..... We did as much as we could post build ovens, cooktops, shower screens, splashback we wanted to do our benchtops also ourselves but it was too hard. Re: Maximum margin that a builder can take over RRP 4Jan 19, 2014 12:35 am bluesteel When we built upgrades were 20% above RRP!! Ya.. thats what.. From what I could see.. in this case the builder is charging around 50% over RRP. Is it legal and allowed? Re: Maximum margin that a builder can take over RRP 5Jan 19, 2014 6:53 am There is nothing to limit their margin. Have the discussion with them though and let them know you know the retail price of the sink. The other part you need to consider though is what else changes? EG if you're changing to an under count sink the cut of the stone needs to be precise and the edge polished? Maybe an etched draining board as well. http://camdenbuild.blogspot.com.au/ by invite only please pm me Re: Maximum margin that a builder can take over RRP 6Jan 19, 2014 7:03 am Pretty sure it is 20% margin allowed on extras. Remember that is margin, and margin is the proportion of the price they sell to you, so that is 25% ON retail, and then it depends what retail is... So they may buy at RRP, but get rebates on quantities etc. or rebates on bundling (all CSR products or Boral products). It's difficult to see what they would really pay for any item. So I would expect 25% on RRP to be "reasonable". Remember also, that any change requires admin, paperwork, delivery and drawings, a sink would require bench and tap changes (maybe), tradesman costs. And every change is an opportunity to stuff things up. An exchange won't be RRP for RRP, they would buy the standard items in the builders' range at a massive discount, add-ons at close to RRP, plus all the ancillary cost mentioned. Many builders would rather build identical homes, no changes. Ed "ECOECO" At 'EcoEco', we design windows, we design the best windows, we do it for you, so that when you’re happy we are happy. Tel. 1800 326 326 Hi Mofflepop, I would recommend finding a building designer to prepare plans, they should design to your specified budget. The benefit is you can tender the project out… 9 20413 The distance between my DEBs varies from 4.1m at the narrowest to 8.1m at the widest. 5 27305 Thanks again for this information. If you do hear anything different, would be great to know 4 8242 |