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3 Things You Need to Know BEFORE Signing a Residential Building Contract

June 3rd, 2016

Building a new home or extending an existing home is likely to be one of the largest purchases that you will ever make. Planning is the most important stage of any building work so a good builder will step you through this process. The planning stage will later be written down in a building contract and should reflect all discussions with your builder. Choosing exactly how you would like your home to look before watching it take shape is a hugely exciting experience. Your interactions with the builder should establish a good working relationship that will last 3 – 6 months. But this can all be ruined if you don’t choose the right builder for the job.

Here are just some of the crucial questions that should be asked before you sign a contract.

Is the Builder Right for the Job?

The very first thing you should determine is whether or not the builder that you’re planning to choose is right for the job. First of all, finding out whether or not they have the necessary skills and expertise to carry the job out is essential. If they have the experience and know-how, you’ll likely be able to see examples of their previous work. It’s also vital to ensure that your builder is licensed and permitted to carry out the type of work you want done.

Have You Done a License Search on Builder’s History?

A builder’s work history is recorded where Home Warranty Insurance has been paid for on a project. In Queensland this type of insurance is required for all building work valued over $3,300 including GST.  You can do a free License Search of any contractor or subcontractor who is permitted to work legally in Queensland at:

http://www.onlineservices.qbcc.qld.gov.au/OnlineLicenceSearch/VisualElements/SearchBSALicenseeContent.aspx .

You probably have a friend or someone who has recommended a builder to you. However, you as a consumer are required to do your own background investigation. On the License Search you can see the number of jobs the builder has undertaken and the value of work carried out.

Where a contractor has failed in his duty to perform work properly, this will be recorded against his/ her license. You may have the situation where a young contractor who has only put up house frames, and is not familiar with the type of work you are undertaking like a home renovation or extension.

Is the Contract Document Authorised by Queensland Building and Construction Commission?

Disputes are not uncommon and can occur for many reasons. But usually it is over money and mostly occurs when the homeowner’s expectation is different to the builder’s expectation. A quality builder will leave you in no doubt about what work you will get done and what work is excluded from the contract.

By doing your own License Search you will be able to tell who the good ones are, as their list of disputes will be low or non-existent. Finding out whether your builder has any past or current building disputes is important.

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