Essential Questions for Sydney Builders: Before Signing Your First Home Building Contract
The decision to purchase or build your home is a large financial investment. So it makes sense that if you’re putting significant funds into something, you want to make sure the result is as good as it can be.
Before you sign your first home building contract, you will want to select a builder who is on the same page as you, someone you can trust, who can answer all your questions. If you leave a stone unturned, you could miss out on vital information that changes your whole building experience.
Let’s look at some essential questions future home owners should ask before signing the dotted line and commissioning someone to build your dream home.
1. Determine a Builder’s Experience and Reputation
Before you commit to a particular contractor, you need to do your research. In part, this means using search engines and reviews, but there are also some queries you can put to a builder to ascertain their experience:
How long have you been in business as a builder?
Building contractors tend to work in the business for some time before they take on their own contracts. It’s a good idea to check your builder’s experience level before hiring them to ensure their capability. Ask what types of projects they have worked on in the past, such as single storey homes, knock down rebuilds, split level homes, sloping blocks, etc.
Many builders focus on a certain style of home, meaning that you should select a builder that specialises in your preferred home style and has experience in designing homes similar to your own.
In New South Wales, many licensed builders are also members of the local Master Builders Association, giving you another background check you can potentially make.
What is your license number and insurance coverage?
All reputable builders should be able to provide you with a license number, as it is easy to verify this. For example, if you are looking to build a home in NSW, you can check this number with NSW Fair Trading.
In terms of insurance, it’s vital that they state they have Professional Indemnity Insurance, which is the industry gold standard, and Domestic Building Insurance. Builders Warranty Insurance is also good to look for, as it will protect you in the event of non-completion of the project.
Can you provide references from past clients?
While word-of-mouth recommendations are good, it is even better to get people, whether current or past clients, to commit to a written reference so their track record can be checked. Some builders will even have testimonials on their website, which do this for you.
It’s even better if they have worked on any display homes you can view. You might even get some bonus design tips from the visit.
What is your average building project timeline?
Timelines are always tricky to determine, as any number of moving parts can change. By asking for build times from previous projects of equivalent size, you can usually gauge roughly what your project could look like.
Do you have a process for handling challenges and delays?
Inevitably in almost every project, something will not turn out how you expect it to. It’s good to know you’re in safe hands and that your builder has a process for when something goes wrong.
2. Understanding the Building Process
If you are trusting someone to build your dream home, you will want to approach the construction process with some expectations of how they will tackle the project. Consider the following questions:
How often will we communicate throughout the building process?
This is a good way to discover what your expected involvement level is. Make sure it is an amount you are comfortable with.
How will we handle decision making and approvals?
Custom homes need to live up to the specifications of not only the building designers but also the person it’s being built for. If important questions and design-altering decisions are not brought to you, it could compromise your vision.
Things like fixtures and fittings may seem small to some but things like supply chain issues can result in changes to the building plan. Ensure you are comfortable with which decisions are brought to you and which are left to your contractor.
What is the process for making changes or modifications to the plans?
Between your initial design consultation and the build, your ideas and needs can change, so it’s good to know how to go about communicating these throughout the building process.
3. Explore Materials and Quality
If you’re looking to build your dream house, you are probably approaching the project with a particular quality and design aesthetic in mind. Dream homes are only as sturdy and beautiful as the materials and craftsmanship, so do ask the following questions:
What types of materials will be used for the construction?
This is almost one of the design questions, but it is worth checking if your builder is on the same page as you. You’ll want to ensure the materials used match your vision and support sustainable living.
For more on this, check out our article on choosing the right materials for building your house.
Are there any specific brands or suppliers you recommend?
It stands to reason that builders should have existing relationships with suppliers they regularly use. If they do, they’re hopefully getting you the best possible price.
What is your warranty policy for materials and workmanship?
Warranty periods are worth checking. In the unfortunate event, something goes wrong with your house in the aftermath of the build, you want to know you are covered. You’re probably looking at a statutory period of 6 years, but do add this to your contract checklist.
4. Financing and Budget
Construction contracts deal with large sums of money and are often financed by loans, so it’s essential to have clarity and transparency.
What is the estimated cost of the project, including permits and fees?
Getting quotes can be tricky business, as contractors look to be competitive but equally need to give you a budget they can stick to. An experienced and registered builder should be able to give you a fairly accurate estimate and, therefore, allow you to compare quotes before you commit.
Make sure you include questions about permits too, as these costs can all add up in building and construction.
Can you provide a detailed breakdown of the costs involved?
This is the next step in ensuring your final price is close to the estimate. Once a detailed budget has been provided, you can push for a fixed price contract, which is one of two types of building contracts, the other being cost plus contract.
A fixed-price contract could save you thousands, so it’s a good idea to have one in place.
What is the payment schedule, and what are the payment terms?
If you are looking to take out a construction loan, you can benefit from lower overall interest, so it is worth checking whether your builder is happy to accept progress payments.
You should also check whether your final payment term is on a fixed date or upon completion. Make sure all the terms are clear to avoid ambiguity.
5. Understanding Contracts and Legal Matters
Nobody likes shelling out money for legal disputes, especially new home owners. Being prepared is essential and could potentially save you thousands if something goes wrong. Go through the fine print with a fine tooth comb, and speak to your builder about the contract beforehand by asking these questions:
Can I review the construction contract before signing?
For ultimate transparency, you would hope the answer to this question would be ‘yes’! One of the golden rules is to make sure you are given ample time to read through the terms and conditions before you sign.
Who is responsible for obtaining necessary permits and passing inspections?
Ensure this detail has been designated to a trusted builder. This should be a standard inclusion.
How will you protect against liens from subcontractors and suppliers?
Contractual disputes can go the other way too – suppliers and subcontractors can be unhappy with the project themselves. Ensure you are not personally liable for payouts by verifying that your builder is prepared for such an eventuality.
Summing up
Communication is the key to allowing you to choose the right builder for your project. By following our top tips for the best questions to ask, you can save yourself time when selecting the best builder for your project. From credibility questions to deposit and pricing questions, the best way to avoid unwelcome surprises is simply to ask.
Provincial Homes has built over 3,500 homes over the past 30 years and our valued customers are our priority. We understand that choosing to purchase a property is a major financial decision and knowing how to choose a builder that you can rely on and trust is essential for this process.
We have an experienced team of builders that are passionate about delivering high quality projects and helping you to achieve your property dreams. Throughout the home building process, our builders will communicate with you and make sure you feel comfortable at every stage of the journey.
We specialise in:
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Single Storey Homes
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Double Storey Homes
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Duplex Homes
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Fonzie Flats
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Granny Flats
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Acreage Homes