What Questions Should I Ask A New Construction Builder?

Making updates and changes to your home is stressful enough without worrying about cowboy builders ruining your experience. A few simple questions before you hire someone could save you a lot of heartaches. A good builder takes away a lot of the potential for frustration and can turn your dream home experience into a bottomless money pit. I’ve been to plenty of barbeques and social events where people have told me some terrible stories about dodgy builders who skip corners, shirk responsibility and are generally a pain to deal with.

Are You A Licenced Builder?

This is the first question you need to ask. Only ever work with licenced merchants. It may seem like an obvious point to reinforce, but people either don’t ask or go with an unlicensed builder to save money. The results can be disastrous. Each state allows you to search builders to check their licence. A simple Google search for ‘check a builder’s licence’ will get you started. Please do it.

What Level Of Customisation Do You Offer? 

While brochures for builders always display the best. Most builders will try to keep costs lower by offering run-of-the-mill floor plans. However, the customisations that they offer will only be cosmetic, and anything substantial can add to your expenses. This can greatly depend on getting an architectural home or a project home. Personalisation of your home is vital to ensuring the end product is the home you love from the beginning.

That’s why, before you hire the builder, make sure to ask the right questions—things like the level of customisation that’s included in the budget. A builder will always give you the option of extensive customisations at reasonable price points. Customisations range from adding a raked ceiling to adding a new bedroom. Right through to completely changing the floor plan right down to each room’s handles and colour palettes.

Do You Have Home Indemnity Insurance?

what questions should i ask a new construction builderYou need to make sure your builder issues you a Certificate of Currency for Home Indemnity Insurance before paying them anything. This covers you for financial loss should the builder die, become insolvent or do a runner.

Are There Any Current Or Past Building Disputes Underway With The Relevant Building Commission In Your State?

This will let you know about the builder’s general reliability and professionalism, as well as the overall quality of their work.

FAQs About Questions To A New Construction Builder

If your builder went belly-up at some point, it might mean a quick eject button on your project should they not have the financial wherewithal to finish the job. A bankrupt company may pull the plug without warning leaving you stuck with a half-built house and searching for a builder willing to complete the job.

It seems simple, yet many people don’t ask this question. For example, your builder may not be interested in building somewhere where they have to travel. The builder may also have to hire sub-contractors he’s not familiar with, and these people may not be up to standard.

A builder agrees to perform building maintenance for a while after the property is handed over to you. Most experts recommend a six month maintenance period for residential units and 12 to 18 months for commercial properties.

While visiting past properties can give you a good idea of the builder’s quality, talking to a couple of their clients is even better. First, ask the builder for some recent references. Then, talk with these homeowners to understand how your builder operates.

If you find your builder unwilling to give references, this probably means that their clients weren’t happy. It’s important that their clients are happy with their work or not as experienced as they claimed. Most builders will happily hand over references. Be sure these references are for works you’re looking to have done. A home renovation is very different from a custom-built home.

This is important because the construction supervisor is the guy who keeps everyone honest. When a supervisor is on-site, higher quality work is performed. Look into this person’s track record, including their past experiences and duration at their current employer.

What About Your Trade Base And Its Long-Term Employment?

A consistent and reliable trade base is essential to making certain the job will be high quality come what may.

What’s Your Quality Control System?

You’ll need to be aware of the quality control measures that the builder has in place. Quality control is the one aspect you can’t compromise on during the construction process. Quality must be the determining factor, whether the finishing or durability. So, ask your builder about the nitty-gritty of their quality control measures. From where do they source their materials? Do the staff have the right credentials and experience? An upfront builder will not have any hesitation in letting you know about their entire quality control process. Most builders hire contractors to complete work, such as a plumber, electrician, render, pools and roofing. All handled by other businesses. The contractor the builder chooses can impact the quality control of the entire home.

Knowing the builder has picked their contractors based on quality. Making sure not to pick on price can make all the difference.

Can We View Your Recently Finished Projects?

This is absolutely a no-brainer. First, you must look at the builders’ recently completed work. This way, you can see for yourself if the builder is doing the type of job you want for your home. Check out the quality of products used and the work completed. If possible, speak to the builders’ clients and get references. This way, you can get feedback about customer experience and satisfaction. You’ll be surprised about how forthcoming people are with details.

What Other Projects Will You Be Involved With While Working On My House?

You don’t want the builder to be biting off more than they can chew. The more they can concentrate on your job, the fewer mistakes they will make and not to mention your project will be done faster.

What’s Your Reporting Process?

As the homeowner, you’ll naturally want to be kept in the know during the construction process. The best-quality builders will always keep you up to date with weekly reports. This will make sure you’re aware of on-site changes in real-time. Knowing the building process can make all the difference to the outcome of your new home. 

So, it would be best if you asked your builder about their reporting process. What’s the reporting frequency? Are they going to have a dedicated contact person? Don’t hesitate to get all these details cleared at the very outset. The process in which a report is handed down can greatly impact the build time, progression and quality of the finished product.

When Can You Complete The Project?

A good builder always knows the time it’ll take to complete a particular project. Indeed, construction is not an accurately measurable process. Several factors, ranging from trouble sourcing materials to weather problems. These can delay even the best routines.

If your builder knows what they’re doing, they should be able to give you a ballpark figure. Builders will know about the general timeline of your project. Ask for specific milestone points, such as how long it would take to lay the foundation for a better assessment. Just as important to the completion date is how delays are handled. When a catastrophic weather event hits, how the builder handles the situation can be as serious.

What’ll Be The Cost?

what questions should i ask a new construction builder (2)This, of course, is the most important factor for most people. Getting an accurate estimate of the construction costs is essential for source funds. Most banks are not interested until a quote is given. A good builder will always be transparent with the prices and give you a watertight budget with good room for change. Be sure you check what extras may arise, the finishes, and whether this is a set final price or an estimate. Building companies are far too quick to under quote and charge for minor details. A quality builder will include adjustments within their initial price.

What’s Your Cancellation Policy?

No one knows what tomorrow holds, and you may have to stop, postpone, or even cancel the contract due to unforeseen circumstances. Ensure that there’s a provision to do so in the builder’s contract. Comfortable cancellation policies can save you many headaches in the long run. Both you and the builder must be covered in the unfortunate event of a cancellation.

Unfortunately, there are a few sneaky strategies that some builders use to mislead clients to secure projects. With a better understanding of how the game is played, you will be better positioned to identify and avoid the ‘smoke and mirrors and ultimately enjoy a smoother and less stressful build, with far less risk of experiencing budget blow-outs. However, none of this knowledge will be useful unless you are willing to ask the right questions and accept that you need to look beyond the cheapest cost to find the ‘right’ builder.

How Have Provisional Sums Been Determined?

More than any other aspect of your quotes, you need to understand the impact of provisional sums. Provisional sums are allowances the builder makes for tasks (such as the installation of structural steel and the construction of retaining walls) where the final selection is not yet confirmed or where there is detail lacking at the time of quoting; they are an allowance that is made for both materials and labour that are required to complete the task. 

Because they are only allowances, they are also subject to change depending on the final cost of completing the task. The important thing to understand is that the client pays for any shortfall between the provisional sum allowance and the final cost of completing the task, not the builder. Under the provisions of the building contract, the builder is also entitled to charge an additional 20 per cent builder’s margin on top of the difference. Adjustments to provisional sums are one of the most common areas where clients experience budget blow-outs, often because the provisional sum allowance is unrealistically low, to begin with.

How Have You Dealt With Demolition Costs?

If you are extending or renovating, there will be some level of demolition involved in your project. Demolition is another cost included in a quote as a provisional sum and is subject to change. The costs associated with demolition must be set out in the builder’s quote so that you can understand the full costs of the demolition. Ideally, the demolition should be included in the quote rather than a provisional sum.

If the builder has nominated a provisional sum, you should ensure you understand how much has been allocated for demolition works. Then, by comparing the allowances of each builder, you will know which builder has been more generous with his allowance, which reduces the risk and severity of cost increases.

Have You Included Everything In The Inclusions Schedule?

You should always provide builders with an inclusions schedule and detailed drawings for quoting. This is because there are dozens of items that the plans either don’t cover at all or don’t deal with in sufficient detail to enable the builders to prepare a quote that is thorough, accurate, transparent and easy to compare. 

I’m talking about all of those items that are either represented on a plan or presumed to be included but not detailed in any way. For example, what type and quality are the bathroom fittings and taps? Are towel rails and lights included? How will the built-in robes be fitted out? Are the floor tiles high quality or budget range, and are the bathroom walls tiled to full height or half height? Quite simply, detailed drawings alone are not enough.

Preparing an inclusions schedule is one of the most powerful ways to limit the likelihood of experiencing budget blow-outs. An Inclusions Schedule helps to ensure that quotes are thorough and more accurate from the beginning by clarifying and identifying items that are often left out of quotes, only to become additional costs or ‘variations’. In addition, by ensuring the builder has included all of the items nominated in the inclusions schedule, you will find it much easier to compare the quotes you receive as ‘apples with apples.

What Is Excluded From The Quote?

Asking a builder what is excluded from their quote is one of the best ways to understand what is included. It’s a bit like reverse engineering; sometimes, you need to start from the end and work your way back. By highlighting excluded items, you will be able to ensure that you are comparing ‘apples with apples when looking at other builders’ quotes. Some of the more common items excluded from quotes include government charges, consultants’ fees, asbestos removal, retaining walls, driveways, footpaths, fencing, floor coverings and curtains and blinds. If any of these items are required to be included in the builder’s scope of works, they should be included in the quote – and ideally not as provisional sums for the reasons previously mentioned.

Who Will I Be Dealing With During The Build?

There are many different kinds of builders, and it is important to understand the kind of builder you will be working with. Is the builder a project manager, or does he involve himself with the physical aspects of building the house? You may like the idea of the same guy who did the quote to be the one who is also swinging the hammer, or you may prefer a project manager-style builder whose only tools will be his mobile phone and computer.

Do you pass on your trade discount for ‘prime cost’ items?

Builders buy a lot of materials. Therefore they get access to trade discounts. The discount will vary from supplier to supplier and even from one product or brand to the next. Higher volume builders may also receive a bigger discount than smaller builders. Builders can add value to their quote by offering clients their buying power – quite simply, passing on any trade discount to the client. 

This means that when the client selects ‘prime cost’ items like kitchen appliances, bathroom fittings and floor tiles, they will be able to make some savings over and above what they could usually expect. In a new home build where there are a lot of items to purchase, the savings can be thousands of dollars, so it is well worth asking the question.

Conclusion:

It may be that the builder employs a site supervisor to manage projects. You must understand the business structure, so you know who you will be dealing with on a day-to-day basis throughout the build.

It would be best to ask how many projects the builder typically has underway at any given time. If the builder is on the tools, they are less likely to manage several projects at a time, whereas a project manager is more likely to run several projects. In either case, make sure that the builder is not stretching their capacity by taking on your project.

Remember, building a new home is a huge financial and emotional investment. So please take the extra time to thoroughly check any prospective builder, their quality, references, and credentials.

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