Extension Building Quotes - What Stops Builders Racking Up the bill during construction

twopenny

Get to know the builders and their reputation.

If I was going to have something as important done to your home you want it done properly, both for you and for resale. Go to one that has been in business for years. They wouldn't be if they weren't reliable. Preferably with an office and site. That shows committment.

For smaller jobs find out where they are working and  pass by. If their hard to great, outside on their phones having a fag then no.

We have a couple locally, one I have absoloute faith in. He came and looked throughly, asked questions, listened.

Turned up with the workers on first day and second to be sure everything was ok. Came at end to see if I was satisfied and the one thing needed redoing was done in a couple of days.

No wonder they've been in business for decades.

Another is but they are more expensive and you're always chasing them up.

Also for a good builder you will need to wait. The best builder and ditto plumber here are booked up to a year in advance. That's a good sign.

Section62

Doozergirl said:

Trust is so important, I say pick the people you're working with like you'd pick friends.   Would you sit down and eat dinner together happily?    The cost is secondary, frankly.  

^This.

Good outcomes depend on communication.  If you can't communicate with a trader without resorting to doing it via nothing but legally binding contracts then the outcome will be sub-optimal.

It is also about fairness - as stuart45 pointed out you don't really know until you start digging.  Expecting the builder to absorb all the costs associated with uncertainty is unfair, unless you are willing to pay well over the top to start with to cover the potential risk (which again is a sub-optimal outcome).

And from a client perspective, the ability to change things and leave decisions to later in the project has value - if the client wants to nail the builder down on price then they need to be prepared to accept zero scope for changing their mind about stuff later in the project.  That means spending more at the design stage to get everything just right, or accepting things may not turn out as well as they could.  I.e. another sub-optimal outcome.

Give and take.

Bookworm105

Mutton_Geoff said:

MikeJXE said:

What stops them from adding hundreds, or even thousands of pound to the bill and blaming it on inflation

A signed contract and a fixed price

If you ask a builder to sign a fixed price contract, expect it to be marked up by 20-30% to cover variables.

Over the last decade, I have spent almost £1m on work to 3 houses. None of them had a signed contract nor fixed price. The time to find out whether the price is likely to vary from the estimate is in prelim discussions as the builder will share their concerns with you about what might go wrong (finding underground services, insufficient foundations, rotten buried timbers etc).

and that sadly reflects the difference between servicing a domestic client and a "proper" client

getting a builder to use a written contract on a domestic job is like asking them to commit the crime of the century as they would have to commit to things they don't like doing, eg: planning the work.
I agree however that where a contract is signed, the price will be inflated by a lot, and the contract will be full of caveats regarding unforeseen issues and client requested variations 

domestic customers should at least consider "forcing" a builder to use a decent contract (all be it at extra cost to the customer) if the job is going to run into the tens of thousands £. You didn't buy the house without a contract, you won't buy a car without T&Cs existing, so why engage in what will probably be your second largest purchase of your life without formal paperwork

any builder that is not happy to use the Home owner JCT contract is not a reputable builder, since JCT is the industry standard contract documentation 

Home Owner Contracts (jctltd.co.uk)

FreeBear

gzoom said: What ever contract or paperwork you sign, you need a contingency in your budget, at least 10% buffer for extra costs, but more if possible. What ever you don't spend on the actual build you can use to upgrade finishing spec.

depending on the scale and scope of the work, a 25-50% contingency is likely to be a more realistic buffer.

Doozergirl

Bookworm105 said:

Mutton_Geoff said:

MikeJXE said:

What stops them from adding hundreds, or even thousands of pound to the bill and blaming it on inflation

A signed contract and a fixed price

If you ask a builder to sign a fixed price contract, expect it to be marked up by 20-30% to cover variables.

Over the last decade, I have spent almost £1m on work to 3 houses. None of them had a signed contract nor fixed price. The time to find out whether the price is likely to vary from the estimate is in prelim discussions as the builder will share their concerns with you about what might go wrong (finding underground services, insufficient foundations, rotten buried timbers etc).

and that sadly reflects the difference between servicing a domestic client and a "proper" client

getting a builder to use a written contract on a domestic job is like asking them to commit the crime of the century as they would have to commit to things they don't like doing, eg: planning the work.
I agree however that where a contract is signed, the price will be inflated by a lot, and the contract will be full of caveats regarding unforeseen issues and client requested variations 

domestic customers should at least consider "forcing" a builder to use a decent contract (all be it at extra cost to the customer) if the job is going to run into the tens of thousands £. You didn't buy the house without a contract, you won't buy a car without T&Cs existing, so why engage in what will probably be your second largest purchase of your life without formal paperwork

any builder that is not happy to use the Home owner JCT contract is not a reputable builder, since JCT is the industry standard contract documentation 

Home Owner Contracts (jctltd.co.uk)

JCT is a standard contract in commercial settings worth millions of pounds with people employed to work as contract administrators, and the rest. 

While you want a contract, you want one that is easy for both parties to understand, isn't 50 odd pages long and can be interpreted clearly.  I'd defy any ordinary homeowner to even begin to understand it, making it completely useless unless you're going to start paying solicitors.   It doesn't help homeowners , so what's the point in insisting on it?    

There are more suitable contracts out there for domestic works.  

You seem to have an anti-builder attitude that isn't healthy.  Needing to mark up a contract to account for every conceivable eventuality, for a totally inflexible client who can't accept that surprises are par for the course is the only way that a builder could be profitable.  

Again, it's why mutual trust and communication is the best way forward.  You accept that there could be issues and you plan sensibly, that the client pays when they arise.  You can't have it both ways - refusing to accept risk nor wanting to pay for it.  If it's your house it's your job to pay for the required work.  

I can guarantee if you expect to fall out with a builder, you will, even if they're perfectly trustworthy.   

gzoom

Doozergirl said:

Again, it's why mutual trust and communication is the best way forward.

All I say is to get your build from a building site and nothing more than fantasy to something habitable, it takes trust, communication and quite bit of hard work.

Looking at our build 12 months ago, no amount of contract or paper work would have got us to where we are today. Without trust the contracts are utterly worthless.

What we've learnt it building a house isn't like buying a car or even a house. It's unpredictable, what architect draws on paper more often than not doesn't take into account trying to build in mud, rain, snow etc. It takes a whole team of people with a host of skills, to work together, often thinking on the job to deliver the sometimes crazy expecations of clients.

I have utter respect for all people in the trades, and can see why good builders are so busy and in constant demand. I get paid to essentially sit in front of computer and prepare word/power point meetings, no amount of ££££ could enable me to do what the trades can do, day in day out.

Good luck to the OP, but I think the majority of people who haven't been involved in any kind of major building work simply don't have a clue about what a totally different experience it is from going into a shop and just buying a car, furniture etc etc.

Albermarle

Doozergirl said:

Bookworm105 said:

Mutton_Geoff said:

MikeJXE said:

What stops them from adding hundreds, or even thousands of pound to the bill and blaming it on inflation

A signed contract and a fixed price

If you ask a builder to sign a fixed price contract, expect it to be marked up by 20-30% to cover variables.

Over the last decade, I have spent almost £1m on work to 3 houses. None of them had a signed contract nor fixed price. The time to find out whether the price is likely to vary from the estimate is in prelim discussions as the builder will share their concerns with you about what might go wrong (finding underground services, insufficient foundations, rotten buried timbers etc).

and that sadly reflects the difference between servicing a domestic client and a "proper" client

getting a builder to use a written contract on a domestic job is like asking them to commit the crime of the century as they would have to commit to things they don't like doing, eg: planning the work.
I agree however that where a contract is signed, the price will be inflated by a lot, and the contract will be full of caveats regarding unforeseen issues and client requested variations 

domestic customers should at least consider "forcing" a builder to use a decent contract (all be it at extra cost to the customer) if the job is going to run into the tens of thousands £. You didn't buy the house without a contract, you won't buy a car without T&Cs existing, so why engage in what will probably be your second largest purchase of your life without formal paperwork

any builder that is not happy to use the Home owner JCT contract is not a reputable builder, since JCT is the industry standard contract documentation 

Home Owner Contracts (jctltd.co.uk)

JCT is a standard contract in commercial settings worth millions of pounds with people employed to work as contract administrators, and the rest. 

While you want a contract, you want one that is easy for both parties to understand, isn't 50 odd pages long and can be interpreted clearly.  I'd defy any ordinary homeowner to even begin to understand it, making it completely useless unless you're going to start paying solicitors.   It doesn't help homeowners , so what's the point in insisting on it?    

There are more suitable contracts out there for domestic works.  

You seem to have an anti-builder attitude that isn't healthy.  Needing to mark up a contract to account for every conceivable eventuality, for a totally inflexible client who can't accept that surprises are par for the course is the only way that a builder could be profitable.  

Again, it's why mutual trust and communication is the best way forward.  You accept that there could be issues and you plan sensibly, that the client pays when they arise.  You can't have it both ways - refusing to accept risk nor wanting to pay for it.  If it's your house it's your job to pay for the required work.  

I can guarantee if you expect to fall out with a builder, you will, even if they're perfectly trustworthy.   

Presumably though you would encourage both sides to have something clear in writing about the project, even if it was not legally binding?


List of work needed with some details.
Approx time scale.
Itemised cost / who pays for what. ( subject to unexpected developments)
Payment schedule 
Etc

Then at least you do not get disputes down the line about what was originally agreed at least.

I used to sell raw materials to manufacturers and some of them would never sign a contract, even when it was Millions of Pounds pa. However there was still a clear agreement of pricing, delivery schedules, credit terms  etc 
The lawyers/Bosses did not like it, but commercial need to sell product was more of a priority than legal niceties, as long as you had reasonable trust in the customer not to behave badly, and they had the same trust with the supplier.

So seems the same in the building trade really, on a smaller scale. 

Doozergirl

Albermarle said:

Doozergirl said:

Bookworm105 said:

Mutton_Geoff said:

MikeJXE said:

What stops them from adding hundreds, or even thousands of pound to the bill and blaming it on inflation

A signed contract and a fixed price

If you ask a builder to sign a fixed price contract, expect it to be marked up by 20-30% to cover variables.

Over the last decade, I have spent almost £1m on work to 3 houses. None of them had a signed contract nor fixed price. The time to find out whether the price is likely to vary from the estimate is in prelim discussions as the builder will share their concerns with you about what might go wrong (finding underground services, insufficient foundations, rotten buried timbers etc).

and that sadly reflects the difference between servicing a domestic client and a "proper" client

getting a builder to use a written contract on a domestic job is like asking them to commit the crime of the century as they would have to commit to things they don't like doing, eg: planning the work.
I agree however that where a contract is signed, the price will be inflated by a lot, and the contract will be full of caveats regarding unforeseen issues and client requested variations 

domestic customers should at least consider "forcing" a builder to use a decent contract (all be it at extra cost to the customer) if the job is going to run into the tens of thousands £. You didn't buy the house without a contract, you won't buy a car without T&Cs existing, so why engage in what will probably be your second largest purchase of your life without formal paperwork

any builder that is not happy to use the Home owner JCT contract is not a reputable builder, since JCT is the industry standard contract documentation 

Home Owner Contracts (jctltd.co.uk)

JCT is a standard contract in commercial settings worth millions of pounds with people employed to work as contract administrators, and the rest. 

While you want a contract, you want one that is easy for both parties to understand, isn't 50 odd pages long and can be interpreted clearly.  I'd defy any ordinary homeowner to even begin to understand it, making it completely useless unless you're going to start paying solicitors.   It doesn't help homeowners , so what's the point in insisting on it?    

There are more suitable contracts out there for domestic works.  

You seem to have an anti-builder attitude that isn't healthy.  Needing to mark up a contract to account for every conceivable eventuality, for a totally inflexible client who can't accept that surprises are par for the course is the only way that a builder could be profitable.  

Again, it's why mutual trust and communication is the best way forward.  You accept that there could be issues and you plan sensibly, that the client pays when they arise.  You can't have it both ways - refusing to accept risk nor wanting to pay for it.  If it's your house it's your job to pay for the required work.  

I can guarantee if you expect to fall out with a builder, you will, even if they're perfectly trustworthy.   

Presumably though you would encourage both sides to have something clear in writing about the project, even if it was not legally binding?


List of work needed with some details.
Approx time scale.
Itemised cost / who pays for what. ( subject to unexpected developments)
Payment schedule 
Etc

Then at least you do not get disputes down the line about what was originally agreed at least.

I used to sell raw materials to manufacturers and some of them would never sign a contract, even when it was Millions of Pounds pa. However there was still a clear agreement of pricing, delivery schedules, credit terms  etc 
The lawyers/Bosses did not like it, but commercial need to sell product was more of a priority than legal niceties, as long as you had reasonable trust in the customer not to behave badly, and they had the same trust with the supplier.

So seems the same in the building trade really, on a smaller scale. 

Of course.  There are other contracts available, it's the idea of forcing people to use a specific contract that at least one party will find very difficult to understand that I find troublesome.

You need one that is clear and as concise as possible. 

 

TELLIT01

I would expect Fixed Price contracts to be like hen's teeth because of the variability in material costs.  If it was available I would expect the builder to demand full architects drawings along with complete Bill of Quantities.  Only the items shown in those would be covered by that fixed price.  Anything and above, for example a requirement for deeper foundations would still be an additional cost in all likelihood.

MysteryMe

There are some very experienced posters on this site who have worked in the building or ancillary trades for years or undertaken numerous DIY projects, so seek their advice if you are every unsure.  They have no skin in the game so their advice is impartial. 

The JCT Home Owners contract is about 8 -10 pages with each section generously spaced out and easy to understand language used.

JCT also have contracts for much larger works / B2B etc which definitely wouldn't be suitable for home owners so make sure if you do down the JCT route it's the right one used.

All the important details should be discussed before works are agreed and it's vital that there is a rapport and openness on both sides but people do have a habit of only remembering things they want to remember especially when there is so much involved in a major build so it's for everyone's benefit for the basics to be committed to writing especially for significant works. For one thing it can clarify if the quoted price is subject to amendment and under what circumstances.  A piece of paper is not going to stop a builder being a cowboy and not going to stop a home owner unjustly refusing to pay their builder but it assists the "injured party" in any arbitration or civil proceedings. It's useful as last resort, not as the go to throughout the build.

Having said all that, I've just had a considerable amount of building works on my house with no contracts in place. I know the builder personally and trusted their judgement on the sub contractors he brought in and to be fair apart from the odd mishap with a pipe being where one wasn't expected etc it's gone smoothly. Not everyone is in that position so if you don't have any personal recommendations use a builder who is long established and / or a member of a reputable trade association such FMB or on a WHICH/Trading Standards vetted trader list.