Fixed price building works?

[DinoDanni]

Just reading on here that builders are agreeing quotes, then upping the costs part way through the project. I appreciate that building supplies have increased, but the contractors need to hedge themselves against this.

Is the price fixed once we’ve signed a contract with the builder? I’m managing a big project and making decisions based on the quotes I’ve got in front of me. I’ll be allocating our budget, so don’t expect to cover a builder’s shortfall (obviously it’s different if something totally unexpected changes within the property).

Likewise, I doubt he’d offer me a rebate if supplies fall again in cost.

Thoughts?

It's fixed only if it says it's fixed, and you change nothing, and nothing unexpected arises. But even in a fixed price contract I bet there are exclusions and exemptions - the rising cost of materials being one.
You should always have a contingency.
I think the best case would be a builder that will be honest about anything that will increase the cost, as soon as it becomes apparent. Also specifying exactly the materials used and costing them out.

Thanks @Livingintheclouds. We do have extra for contingency, but that's for buying new curtains and a car etc 😂

In which case, I'll write into the contract that I expect a reduction also for any materials that decrease over the build and insist on comparative invoices, so I can see the merchant price at the start date and then the same proof if there's a change as the project progresses. I'm not accepting a general "it's now £3k more", which another poster on this board had from her builder!

Thanks!

How would you suggest that builders 'hedge themselves against' increased raw material costs?
There are nearly always changes of plan or things that were unexpected in a building project. Either because of underlying fabric of the house (e.g you lift the floorboards and find rot in the joists underneath that noone knew was there before) or because as you progress plans change (I think I am a massive control freak planner but during a build have decided this door would be better hung from the other side or whatever). You can't expect your builder to absorb either

Good luck with writing anything in to a builder's contract because that's just how you think it should be .

Most builders are overwhelmed with work at the moment and can pick and choose and you might (gently) come across as a bit of a pita if you propose this at the start.

The important thing to do is agree staged and itemised payments. Ask the builder for an invoice every fortnight in a large project. Then you won't lose track. They should be happy to provide this - helps with their cashflow.

In which case, I'll write into the contract that I expect a reduction also for any materials that decrease over the build and insist on comparative invoices, so I can see the merchant price at the start date and then the same proof if there's a change as the project progresses.

Comparative invoices? Good luck with that. I think most builders will take one look at your contract demands and walk away. They're so busy they can pick and choose jobs and why sign up for one where the client looks like they're going to be unbending from day one?

We've always bought the materials and paid day rates for builders. Fixed prices need to cover all eventualities so there's a safety net for the builder. Of course you need to be comfortable with your builder but we are - we usually help with the less skilled bits (clearing the site, priming wood etc) to reduce the builders time and hence the price.

All good points. The builder is dating my friend (new relationship after he finished her building works!!), so he's probably slightly more inclined to make my project work. I can be a bit more of a pita than with other builders 😂

I've already priced the electrics to ensure it's clear the cost per socket etc (so I know the uplift if I add more) and I've asked for the price per metre of coving and skirting etc to be stipulated in the quote, so that will be quite easy to compare any changes.

Appreciate the advice, thanks.

@DinoDanni

All good points. The builder is dating my friend (new relationship after he finished her building works!!), so he's probably slightly more inclined to make my project work. I can be a bit more of a pita than with other builders 😂

I've already priced the electrics to ensure it's clear the cost per socket etc (so I know the uplift if I add more) and I've asked for the price per metre of coving and skirting etc to be stipulated in the quote, so that will be quite easy to compare any changes.

Appreciate the advice, thanks.

Oh yikes, what if they split up while he's working on your house?? 😳

That's definitely at risk! They seem pretty perfect for each other, so fingers crossed 😂

@Loudestcat14

In which case, I'll write into the contract that I expect a reduction also for any materials that decrease over the build and insist on comparative invoices, so I can see the merchant price at the start date and then the same proof if there's a change as the project progresses.

Comparative invoices? Good luck with that. I think most builders will take one look at your contract demands and walk away. They're so busy they can pick and choose jobs and why sign up for one where the client looks like they're going to be unbending from day one?

Agree. Why would any builder accept such terms?

All the tradesmen I know would just refuse to quote. You won't be their only customer.