When you are thinking about having construction work done, it is crucial to make sure you are dealing with a professional builder. Before you authorise any work or sign a contract, it is best to know what to expect.
Here are some questions that you should ask your builder when getting a quote.
1. Is The Price An Estimate Or A Quotation?
When you are having building work done, it is important to appreciate that there is a difference between an estimate and a quotation. An estimate is at best an educated guess of the cost of the building project. Most of the time, it does not cover the final details of the job.
For instance, if you decide to go for a marbled kitchen worktop instead of a polished concrete worktop, you can expect to pay more. Moreover, it is important to appreciate that an estimate is non-binding.
A quotation, on the other hand, clearly outlines all of the aspects of the project in detail. Of course, if you decide to change any specifications, you have to pay the extra. Having a quotation is more advantageous as it provides a more accurate final picture of the breakdown of costs.
2. What Are Your Payment Terms?
One of the first things you should ask about is the terms and conditions. For instance, how does the builder expect to get paid? Most builders ask for a deposit for materials.
Also, it is not unusual for builders to ask to be paid in installments. This helps your builder with cash flow and often helps the project to run smoother.
Make clear with the builder if he prefers to be paid by cheque, transfer or cash. It is best to avoid paying for the entire project upfront and you should never hand over cash without getting a receipt.
3. Are You GST Registered?
This is a question that many forget to ask. If a builder is not registered for GST, they can’t charge you GST. They can reclaim GST on materials but they certainly can’t charge GST on other billable items such as labour costs.
When you are working with a VAT-registered builder, make sure that the company’s or person’s GST number is clearly listed on all invoices. The total price you pay should always include GST.
4. Can You Stick To Your Written Building Quote?
Making clear what happens if the builder comes across any unexpected problems is crucial. The best way to ensure your builder does not stray from the quote is to ask him to provide any changes or additional costs in writing.
In a perfect world, an existing contract should be amended but that does not always happen. Another way to proceed is to ask for a revised quotation – you are perfectly within your rights to do so.
5. What About Hidden Costs?
There are some builders who “forget” to mention costs. A good example would be things like skip hire, scaffolding and permits.
If you are unsure about anything in the quotation, it is best to clarify them as soon as possible. The final quotation should be as detailed as possible and include everything the builder needs to charge to complete the project.
You should also be wary of any hidden costs that may not be obvious in the quote. For example, some builders may not include the cost of skip hire, scaffolding, waste disposal, parking permits or other expenses that are necessary for the project.
You should ask your builder to provide you with a detailed breakdown of all the costs involved in the project and whether there are any exclusions or assumptions in their quote². You should also ask about any potential extra charges for delays, variations, or defects.
6. Does the Quote Include Everything on The Drawing?
If it is a large project, you have probably worked together with an architect to finalise everything. Architects’ details are often very specific. If the specifications or details are not mentioned in the quotation, it is best to find out why.
The quote should be as specific as possible and even mention what fixtures and fittings you expect the builder to use on doors and light sockets. Most architects specify what materials should be used.
It is essential the recommended or advised materials are reflected in the quote or in the contract.
7. Any extra Expenditure?
If it is a very large project, it is a good idea to ask the builder to allow for extra expenditure.
If you like, this is a small emergency budget that he can turn to in case he runs into added expenses. This can be anything from having to cover the building with sheeting in case of bad weather to extra costs for machinery.
It is fail-safe and a safety valve for both of you. Just make sure you agree on what can be classified as extra expenditure.
8. Have You Completed Similar Projects?
This is a question which is not directly linked to the quotation, but it is a question that many new to construction forget to ask.
If your builder has worked on similar projects in the past, it is important to find out more. Many builders are happy to showcase and let you see previous projects.
Not only does this give you confidence, but it is often a source of inspiration as well. The one thing you should always insist on is references that you can verify.
9. Are You Insured?
Don’t just take your builder’s word for it – ask to see his insurance. If your builder makes a mistake or if there is an accident, the last thing you want is to end up paying for it.
Ask for proof of insurance and check the validity details such as expiry date. Most registered builders carry professional indemnity insurance.
10. Are You Going to Issue An Invoice?
It is important to make sure that you get an invoice at the end of the project.
If the project comes with a builder’s guarantee, you will often find it needs to be backed up by a full and final invoice. The invoice should include billing address, phone number, detailed billing and GST.
A final amount due along with any call-off payments should be included on the invoice. If not, call-off or stage payment should be easy to identify on a separate statement.
Getting a quote from a builder is not straightforward. Attention to detail is very important. If you are not sure about any of the details in the quote ask and ask again. To err on the safe side, it is best to ask for any clarification in writing. This is how you avoid disputes and unwelcome surprises later.
Professional advice is available and there are guidelines issued by the Department of Consumer Affairs. Reading up on them before starting the process and speaking to a builder is a great idea.