When will I get charged for my variation?1
Variations are changes that are made to your contract. They can be requested by either the Builder or the client (depending on the situation) and generally relate to your specifications. For example, your contract may include standard profile internal doors but you’ve seen a barn door that you absolutely “must have!”. When you request a variation, your builder will write up a detailed description of what the change is; including any cost/credit that may be applicable. Both you, as the client, and the Builder then need to sign off on the variation.
If there is a cost involved in making the change, this gets charged to the client at the next progress claim after the works have been completed. Using the example of the barn door, this would most likely be charged to the client at Practical Completion. If, for example, you were making a change to the brickwork, this would then be charged at the Brickwork Complete progress claim stage.
Sometimes, clients request to have items removed from their specification; in anticipation of doing this work themselves after handover. This sometime results in a credit (money owed back) to the client. Again, this credit may be applied once that stage of works is complete. However, if your builder uses a HIA Lump Sum Contract, credit amounts do not need to be refunded until Practical Completion.
Also, keep in mind that the Builder does not have to accept a request for variation from the client. This may happen for a couple of reasons including that it’s too late in the build to make the change (ie – materials have already been ordered) or that the change is just not possible due to regulations etc.
Buying Land & the Building Bonus2
We are getting a lot of questions about the building bonus and land availability. From our end, we can’t sign a contract with you until the land title is in your name. If the Developer isn’t expecting titles until Nov/Dec, your contract signing may fall outside of the Dec 31st deadline in the event that titles are delayed.
There is still a lot of uncertainty with regards to the nitty gritty detail of the grants available at both a state and federal level. Industry bodies such as the HIA and MBA have lobbied government to make concessions with regards to builder having to start construction within 3 months of contract signing. This is due to possible delays in areas such as planning and finance approvals which are outside of the Builders control. We are yet to hear if there will be also concessions made if land titles are not available as advertised by the Developer due to hold ups with WAPC approvals.
We will keep you updated as we learn more about how the government plans to deal with these issues. To err on the side of safety, we would recommend that you look for already titled land that is ready to settle before November – leaving you enough time to then work with your Builder to draft plans, create your specification and prepare contracts.
What is a preliminary agreement and how is it different from a deposit?3
A Preliminary Agreement is an agreement between yourself and your Builder to carry out a specific range of works at an agreed price. These works are usually related to the preliminary stages of building such as site contour surveys, preparation of plans, council planning approvals etc. With an Activa Homes Group preliminary agreement, you get what you have paid for and have joint copyright in all materials.
So how is a Preliminary Agreement different from a Deposit? A deposit can only be claimed once a building contract has been signed and home indemnity insurance has been issued. The deposit can only be a maximum of 6.5% of the building contract. A Preliminary Agreement however stands apart from the building contract. After the works as described in the Preliminary Agreement are complete, there is no obligation for you to sign a building contract. If you do decide to proceed with the build, the items already completed will be noted on your contract as already having been paid for.
What is the “Builders Standard Range”4
When making material and colour selections for your new home, you may be asked to choose from the “Builders Standard Range”. This is the range of quality materials and fixtures for which the builder has negotiated special rates with particular suppliers. These rates mean the builder can offer clients pricing at a much lower rate than if they were paying retail. The rates are based on the relationship that the builder has with the supplier as well as the volume of materials that the builder orders.
Your specification will state what is included in your contract. For example, for your main floor tiling, you may be able to choose from the Builders 600mm x 600mm rectified edge standard range. This range will include a variety of colour options from a particular supplier. If you want to choose a tile from a different supplier, there may be additional costs; as the builder may not have a regular trading account with that particular supplier.
As you can imagine, there are many, many suppliers of different building materials out there in the marketplace; and it is not viable for a builder to have a trading account with every single supplier. You may have heard various companies advertising “it doesn’t matter who your builder is ..” but you will need to confirm with your builder as to what is actually included in your contract before making any selections.
Does Activa have standard plans and display homes?5
As a custom builder, Activa Developments designs each new home (or development) from scratch based on our clients brief. However, we do have an extensive catalogue of plans from previous builds that can be used as a basis for those who are unsure where to start. We work closely with all of our clients to ensure that our designs meet their vision, budget and lifestyle requirements. Activa Developments does not have any display homes, but we are more than happy to show our clients recently completed homes as well as homes under construction. We also have some fantastic previous clients who are generous enough to open their homes to others for viewing.
How soon will you start building?6
We pride ourselves on saving our clients time and money by getting to site as quickly as possible. Our record is 8 weeks from initial client contact to slab down! As a client, there are also things that you can do to speed up the process. Creating an ideas board will help you at pre-start when it comes to making your colour selections. Also, as banks require more and more documentation for finance approvals, working with your bank and/or broker to make sure everything is in order will assist in getting your property to site as soon as possible.
Can I subdivide my block of land?7
Subdivision, and consequently how many buildings you can fit on your block, is all dependent upon the zoning as per your local councils Town Planning Scheme. There may also be other considerations such as Detailed Area Plans. Our team have an in depth knowledge of the Residential Design Codes and extensive experience in working with local councils to achieve the maximum benefit on subdivisible development land. We can also assist you with the strata process.