How do you know – if you’ve made the RIGHT CHOICE?
Due diligence is essential!
Mandatory information about the “CONSUMER BUILDING GUIDE”
- Builders and tradespeople must give you a copy of this guide ~ before entering into a contract for residential building work costing more than $5,000. Read this guide to help understand your rights, carry out your responsibilities and protect & support your building project.
- Protecting consumers under home building laws ~ NSW Fair Trading is the NSW Government agency regulating residential building work (including building or trade work on single dwellings, villas, houses and home units) under the Home Building Act 1989.
What to consider before work starts
Licensing requirements include:
● tradespeople and builders carrying out residential building work valued at more than $5,000 must be licensed by NSW Fair Trading
- check a licence at the Fair Trading website or by calling 13 32 20
- check the ASIC register for the business organisational structure, management and longevity of the business’ existence.
● regardless of the work’s cost, a licence is always required for specialist work (like plumbing, air conditioning and refrigeration, electrical work and gas-fitting)
- The ABN register and Fair Trade website can verify what works the contractor is capable and allowed to undertake.
- By choosing a professional, you have the support and security of the DFT, should any disputes arise.
● if the work requires more than one tradesperson, you need a builder to manage the building project and coordinate the tradespeople, such as plumbers, painters and carpenters
- Check their license & trading history
- Read the customer reviews, forums, and testimonials to determine who deserves your business!
Home Building Compensation Fund (previously called Home Warranty Insurance)
Where work is worth more than $20,000 (including labour and materials), the builder or tradesperson must not start work or ask for any money (including a deposit) until they give you a copy of the Home Building Compensation Fund certificate for your job. Certain types of work are exempt; check our Home Building Compensation
Fund web page.
To help your building project go smoothly:
● check with your local council or an accredited private certifier on approvals your building work needs
● engage a building certifier. This is your responsibility, not the builder ́s. Find an accredited certifier at the Building Professionals Board site: www.bpb.nsw.gov.au
Contracts and Payments
All contracts must be in writing. The two main contract types are:
● fixed price or lump sum – where the builder or tradesperson agrees upfront to a fixed amount for the whole job. Unforeseen changes during construction may affect the final cost
● cost-plus contract – there is no guaranteed final cost for the job (often this contract is used where the project’s nature prevents the final cost from being calculated). The consumer repays the builder for verified direct and indirect costs and fees at regular intervals. It is good practice for the builder to give a non-binding estimate before starting and to track costs with you against the project’s budgeted estimate.
Residential building work worth less than $20,000 must be done under a ‘small jobs’ contract. The written contract must be dated and signed by, or on behalf of, each party. It may specify that work is paid for at regular intervals. It must contain:
- the parties’ names, including the name of the holder of the contractor licence as shown on the contractor licence
- the number of the contractor licence
- a detailed description of the work
- any plans or specifications for the work
- the contract price, if known.
Residential building work worth more than $20,000 requires a full home building contract. As well as all of the requirements of the ‘small jobs’ contract, it must include other comprehensive information such as the details of the statutory warranties the builder must provide, and the contract price or warning that the contract price is not known.
Find a complete list of contract requirements on the DFT website https://www.fairtrading.nsw.gov.au/housing-and-property/building-and-renovating/preparing-to-build-and-renovate/contracts.
All contracts over $20,000 in value must have a progress payment schedule. Progress payments must match the work carried out and, for cost-plus contracts, be supported by receipts or other verifying documents.
Any change you need to make to a contract is a ‘variation‘. Variations must be in writing and be signed by both parties to the contract. Almost all variations will impact the contract price.
The maximum deposit you can be asked to pay before work starts is 10%.
Progress payments – or payments at regular intervals can be ‘forecasted’ prior to, and adjusted upon commencement of the project.
Please do not hesitate to contact us if your building, your colleagues or even your neighbours home – needs some BRICKWORK TLC! We provide FREE QUOTES.
We are fully INSURED, COMPLIANT and LICENSED (of course!)
Call us today on 0450 942 080 or Get in touch