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Frequently Asked Questions

Apart from a builder, who else might I need in my project team?

Building or renovating a home is a complex process and involves a wide range of people other than you and the builder.  These are some of the other experts you’re likely to need –

  • an architect or designer – to design your home and prepare construction drawings
  • structural engineer – to prepare the engineering for your home
  • geotechnical engineer – to undertake soil testing if needed to inform the design of foundations or basements
  • surveyor – to survey the contours of the block
  • energy efficiency consultant – to prepare an energy report
  • building surveyor – to issue your building permit and inspection certificates

Depending on your project, you may also need advice from acoustic consultants and/or fire engineers.

 

Over the years we have identified excellent practitioners in all of these areas and are happy to assist our clients with getting these experts on board.

What questions should I ask to check that I am choosing the right builder?

Choosing the right builder is vital for the success of your project so this step should not be rushed.  In order to make a fully informed decision, it’s crucial that you ask a builder the right questions to check that they are up to the job and will be a good fit for you and your project.

 

As builders, we know what other builders do not want you to ask and we have shared this knowledge in our free guide – ‘The 7 Critical Questions to ask before you choose your Builder’.  Download it here now.

Why should I build an energy efficient home? Will it cost more?

This is a common question.  Yes, there are some aspects of a new home that will cost more if you are looking for high levels of energy efficiency.  For example, double glazed windows cost more than single glazed windows; you could upgrade your wall and roof insulation rather than going with the minimum standard required or you could spend more on the building envelope to make the building airtight and install a mechanical ventilation unit to keep the air fresh and remove condensation from your home.

 

But improving energy efficiency will reduce your energy costs, so it is an investment for the future.  As energy prices continue to rise and the cost of new more efficient products falls, the payback period for this investment is reducing.  Also, improved energy efficiency will enhance your home’s comfort and livability and potentially lead to a higher resale value when it’s time to move.

 

Also, it is important not to overlook the range of low cost actions that could improve your home’s energy efficiency, such as –

  • Install curtains or blinds and keep them shut on cold nights and hot days;
  • Seal gaps (we do this as standard on all of our projects);
  • Where practical, keep existing mature trees and shrubs for natural shade and protection, and look into the benefits and opportunities of additional plantings;
  • When choosing a heating or cooling system, check the energy star rating;
  • Replace heat generating incandescent or halogen lights with energy efficient fittings such as LEDs;
  • Consider options for installing renewable energy technologies such as solar panels.

 

With the average star rating for homes in Victoria built before 2005 being only 1.81 stars (6 stars is the current minimum standard), there is huge potential for making significant improvements in the performance and comfort of these homes.

Can I live in my home while it is being renovated / extended?

Depending on the extent of the building works, it may be possible to continue living in your home while it is being renovated and/or extended.  Although a certain amount of disruption will be inevitable, there are things your builder can do to make it as comfortable as possible for you.

 

We know the practical realities of living on a building site and will do everything reasonably possible to minimise the disruption to your everyday life.

 

When deciding whether or not to continue living in your property during a renovation/extension, it is important to keep in mind that this is likely to extend the construction period which may also increase the contract price.  That is because it is likely that the builder will need to schedule the works differently to enable part of the home to remain habitable.

How long does it take you to prepare a quote?

When you have your construction drawings and engineering ready, we would be happy to prepare a comprehensive quote that could form the basis of a fixed price contract.

 

Our quotes are generally 15+ pages long and include a detailed breakdown of the project costs and confirmation of what is/is not included.  It takes us around 4 weeks to prepare a comprehensive quote as we need to allow time for our subcontractors to quote their aspects of the work (this enables us to agree a fixed price for all aspects of the works that have been specified/are known).

 

We also provide a project schedule with our quotes so that you can see the total estimated construction period and the time schedules for all tasks/trades involved throughout the project.  We present this as a Gantt Chart.

 

If your construction drawings and engineering have not been completed, we can still provide a ballpark cost indication via our Initial Build Review.  Although this would not be sufficient to form the basis of a fixed price contract, it can provide you with an early indication of likely build costs and an opportunity to re-visit your design if it’s looking like the build cost will be over budget.

What is Domestic Building Insurance and why does the builder need to provide it?

Domestic building insurance may cover you if your builder cannot finish your project or fix defects because he has died, is declared insolvent or disappears.  Policies issued on or after 1 July 2015 also provide cover if the builder fails to comply with a final VCAT or court order.  It covers costs up to $300,000 to fix structural defects for six years, and non-structural defects for two years. Claims on the policy for work that was not completed may be limited to 20 per cent of the contract price.

 

In Victoria, it is mandatory for the builder to take out this insurance for you if the cost of the works exceeds $16,000.  You are not required to pay the builder any money, including a deposit, until you have received a Certificate of Insurance confirming that domestic building insurance cover is in place.

After I have signed the building contract, will the price change?

Even if you have signed a fixed price contract, it is still possible that the contract price may change.  The two most common triggers for price increases are variations and provisional sum/prime cost adjustments.

 

Variations – either you or the builder may request a variation to the building contract and this may lead to a change to the contract price and duration of the works.  To protect you from unexpected cost increases, there are strict rules limiting when a builder can request or require a variation.

 

Provisional Sums/Prime Costs – these are allowances included in the contract price for items or works that have not yet been confirmed eg an allowance for an oven or landscaping works.  A prime cost is an estimate of the cost of an item and covers the cost of supply and delivery by the builder.  A provisional sum is an estimate of the cost of carrying out particular work.  The contract price will be adjusted (up or down) when the actual cost of the item or works is confirmed.

 

A provisional sum or prime cost must be a reasonable cost estimate for the works/item.  Be wary of builders who include unrealistically low estimates for provisional sums and prime costs to make their quote/contract price lower, only to hit you with additional costs after the contract is signed when the actual costs are confirmed.

Do I always need to appoint a builder on a fixed price basis?

No, it is possible to appoint a builder on a ‘cost plus’ basis but you can only do that in limited circumstances.

 

Cost plus means that the builder charges the actual cost of the works plus a fee (based on a fixed amount or percentage) for his work.  In Victoria, a builder may only enter into a cost plus contract if the reasonable estimate of the cost of the job is $1,000,000 or greater, or other limited conditions apply.

How can I make sure the builder finishes on time?

Before you sign your building contract, check that the construction period specified in the contract is realistic and reliable.  You could do this by asking the builder to provide a detailed project schedule and check that it includes an allowance for delay as a result of inclement weather, public holidays and any other foreseeable breaks in the continuity of the works.  If the builder cannot provide a detailed project schedule, the construction completion date might just be an educated guess or wishful thinking.

 

Also, check your builder’s references to see whether jobs have been finished on time and whether there were long periods when no-one was working on-site.

 

Finally, you could include a liquidated damages clause in your building contract which requires the builder to pay you a specified amount if he fails to complete your home by the completion date in accordance with your contract.  Liquidated damages can cover losses such as rent and must be a reasonable estimate of your expected losses due to delay.  The requirement on the builder to pay liquidated damages not only protects you from loss, it is also an incentive for the builder to finish on time.

What warranties will I get?

In Victoria, every builder who enters into a domestic building contract must give a number of warranties to the owner.  These warranties include –

  • all work will be carried out in a proper and workmanlike manner
  • all work will be carried out in accordance with the plans and specifications set out in the contract
  • all materials to be supplied by the builder will be good and suitable for their intended purpose and that unless otherwise stated the materials will be new
  • all work will comply with all laws and legal requirements
  • the work will be carried out with reasonable care and skill
  • the home will be suitable for occupation at the time the work is completed

 

For further information about these implied warranties and consumer guarantees, visit the Consumer Affairs Victoria website here.