Deciding how to choose a builder can be a daunting and stressful experience. With so many different builders out there, each with their own strengths and value propositions; people often find themselves in a state of ‘analysis paralysis’, or worse – they end up selecting the wrong builder and their dreams of building their dream home can end up being shattered when their project goes off the rails.
Below are some useful tips to help choose the right builder for you.
1. Identify what’s important to you
The first step when you choose a builder is to define your objectives and decide what is important to you. Careful consideration should be given to the following:
- Are you planning to build a ‘cookie cutter’ or ‘off-the-shelf’ home or a custom designed home to suit your individual taste and design preferences?
- Are you building a new home or renovating your existing home?
- Are you building on a new site or are you knocking down and rebuilding?
- Are you building on a sloping block?
- Is quality and finish important to you?
- Are you an investor seeking to maximise your returns?
- What is your budget and how important is the contract price?
- What level of customer service are you seeking? Are you looking for a personalised service or occasional progress updates?
- Is flexibility to make design changes important?
- Are you seeking assistance in terms of interior design, colour selection and selection of interior fixtures and fittings?
- Would you prefer to build with a large volume builder franchise or a local custom home builder?
- What inclusions do you want in your building contract?
The purpose of answering the questions above is to assist you in narrowing down your list of potential builders. For example, if quality, custom design and a personalised customer service is important to you, a local custom home builder is likely to be the right choice for you. However, if quality is a less important attribute and you are happy to select a cheaper ‘off-the-shelf’ home similar to many other homes in your area, then a volume builder may be the way to go. Similarly, some builders specialise in extensions and renovations, others only build new homes and some builders specialise in both. It is therefore important to choose a builder that suits your project.
2. Know the risks
Understanding the risks associated with builder selection is another important consideration. Some builders carry a higher risk profile than others and the last thing any client wants during construction is their builder to declare bankruptcy half way through, or a poor quality home at the end of their build.
Below are some of the ‘red flags’ to look out for when you choose a builder:
- Builders with a bad reputation in the local area. This could be a result of poor quality materials, poor workmanship, poor customer service and/or unreliability.
- Builders with lots of slow moving and unfinished jobs. This can often indicate that the builder has cash flow problems and could be on the verge of bankruptcy and/or your home may take a longer to build than you are budgeting for, which could result in increased holding costs.
- Beware of ‘cheap’ homes. As with everything you buy; you get what you pay for and it’s no different in the building industry. If the contract price seems too good to be true, look out because it probably is. The risk here is that the builder may be using poor quality materials and employing low grade tradies, which have the potential to jeopardise your project and turn your dream into a nightmare. The builder may also produce a poor quality and ambiguous contract specification and slug you with expensive variations throughout the build process to bolster his margin. Some unscrupulous builders compete on price and use underhanded tactics to lure unsuspecting clients into signing a building contract under false pretences. The end result may be a poor quality home that costs you a lot more than you budgeted for. When you choose a builder, compare the end price, not the start price.
- Builders with high overheads are also a watch-out as they must recover their overheads as well as make a profit on every job, which may result in an unreasonably high contract price. Don’t be dazzled by builders with extravagant offices and facilities, as these have been paid for by clients like you. Builders who deliberately keep their overheads low are able to pass on those savings to their clients, which keeps more money in your pocket.
- Rogue builders. Look out for dodgy and unprofessional builders who don’t appear to be running a legitimate building company. Always check to ensure that you choose a builder that is licenced, registered and insured and be cautious of any builders who don’t appear to be legally authorised to be involved in building and construction. Some builders’ licences or registrations may have expired and others may have had their licences revoked, yet they are still involved in the building and construction industry. All builders should have Public Liability Insurance and Domestic Builders Insurance as a minimum. To check whether your builders is registered, you can contact the Housing Industry of Australia (HIA) or the Master Builders of Australia (MBA) for their list of members. A list of licensed and insured builders can also be found from your State or Territory’s relevant department of consumer affairs or fair trading.
- Be wary of builder promotions offering large discounts and bonus inclusions. Look for real value in the overall proposal, as promotions are often too good to be true and are sometimes used as a sales tactic to lure unsuspecting clients into sign building contracts.
- Be aware that display homes generally are built with the high-end inclusions, so whilst the ‘base price’ may seem low and appealing, watch out as the cost of building a home with the same inclusion levels of a display home may be significantly higher than a standard home with budget inclusions.
3. How do I choose a builder?
Before you choose a builder, it is important that you conduct some due diligence to minimise your risk.
The first thing you can do is check out their website and look at some of their recent projects, service offerings and client testimonials.
Once you have identified your preferred builder(s), the next thing to do is to ask the builder for a list of recent clients and then conduct reference checks and get the clients’ feedback on the builder. Ask the clients about the builder’s customer service, build quality and their overall experience. Ask them if they would build with them again and whether it would be possible for you to arrange a tour to inspect the build quality. Alternatively ask the builder to show you around some of their recently completed (or in progress) projects.
It is also worth checking Google and Facebook for any reviews of your prospective builder, as these can provide valuable insights. If a builder generally has poor client reviews and testimonials, building with them could be risky.
Another important thing to do is to choose a builder that specialises in delivering your objectives. For example, if you are renovating your current home, choose a builder who specialises in home renovations. Similarly, if you are building a new home, it is important to ensure that you choose a builder who specialises in building new homes. The best new home builder in your area could be the worst choice to renovate or extend your home, as the builder may not have the relevant knowledge or expertise in this field.
If you are obtaining multiple quotes, ensure that you’re comparing ‘apples with apples’ and not ‘apples with pears’. Whilst several builders may be quoting on the same plans, they will be quoting different specifications, inclusions and exclusions, so the quotes and end results may vary wildly. The best way to obtain and compare quotes is to ensure that a single set of plans, engineering and comprehensive specifications are produced for each builder to quote. Also be careful not to assume that the cheapest quote is the right price. It’s only natural to be drawn to the cheapest quote, however if that quote is significantly cheaper than the others; be careful in selecting that builder as there may be an error in the quote that could come back to bite you later. The last thing you want is for the builder to run into financial trouble and go bankrupt, take shortcuts or charge for lots of variations down the track.
Finally, always ensure that you fully understand the building contract and are aware of all inclusions and exclusions. Some builders exclude items such as driveways, fencing, landscaping, window furnishings, fly screens etc., which can add extra costs to your project at the end if you originally thought they were included in the contract price. Also look out for lots of ‘Provisional Sums’ and ‘Prime Cost’ items in the building contract. These are where allowances have been made for certain items, which can add to the final cost if the original estimate was below the actual costs incurred. Conversely, you will be favourably reimbursed the difference if the estimated costs exceed the actual costs incurred.
Are you looking for a Builder?
The team at Gentify specialise in custom design homes, extensions and renovations, sloping block homes, knockdown rebuilds, duplexes and townhouses and developments and subdivisions.
Whether you already have your plans or need an experienced and professional builder to help guide you through the process; the friendly team at ARCA are happy to help, so call us now on 1800 GENTRIFY or email us at firstname.lastname@example.org.
Disclaimer: The contents and information contained in this article are intended for general purposes only and should not be relied upon by any person as being complete or accurate. ARCA Pty Ltd, its employees, agents and other representatives will not accept any liability suffered or incurred by any person arising out of or in connection with any reliance on the content or of information contained in this article. This limitation applies to loss or damage of any kind, including but not limited to, compensatory, direct, indirect or consequential damage, loss of income or profit, loss of or damage to property and claims by any third party.