Five Steps to Help You Find the Right Builder

Now you may ask – isn’t the builder for me the one with the lowest price? My answer will be: not necessarily. It may sound counter-intuitive, but I can’t stress how important it is that you know WHO is building your new house or renovation project, not just how much they are going to charge you.

The builder with the cheapest price may be attractive, but taking the following five steps before you sign on the bottom line will help you avoid becoming one of those nightmare building stories your friends are so keen to share.

1. Check that the Builder is registered

Under Victorian Law, a Builder must be registered with the Victorian Building Authority (VBA) before they are allowed to carry out work worth more than $10,000 and using a combination of skills/trades eg. plastering andpainting and/or to carry out work that requires a building permit (regardless of it’s value). This is so easy to check online at the VBA website using their “Find A Practitioner” link. It is worth also considering how long they have been registered as well. Have they changed their registered name? If so, why?

2. Check that they are eligible to get insurance for your project

Again, under Victorian Law a Builder is required to take our domestic building insurance for any project worth more than $16,000. This is gives you, the Owner, limited cover in case the builder dies, disappears or becomes insolvent during your project, or fails to comply with a Tribunal or Court Order. It needs to be in place before the Builder takes a deposit.

In order for the Builder to be eligible to purchase this insurance, they must first undergo a financial assessment by the Victorian Managed Insurance Authority (VMIA). In this assessment, the VMIA consider the risk of the builder undertaking works that might not be completed, or which are defective and the risk of the builder becoming insolvent.

You can check any Builder’s eligibility easily on the VMIA website.

3. Check how long they have been in business and trading under the same name

Ideally, you want to work with a Builder who has been in business for a long time and therefore is more likely to be around for a long time into the future, after your building project is complete. Not only is this a good indicator of their ability to manage projects and project finance, it will also be beneficial should you need to contact them about building defects down the track. Again, this is an easy check done online at the ASIC website.

4. Talk to the builder

Yep! Have a chat and ask them about their business and how they would run your project. Do they have a defined Project Manager for your project? Someone who is familiar with the work required and will oversee work on site and off relating to your project. Who would be your point of contact? Will you have a single person available so you always know who to contact? Do they have permanent trade staff, or is all the work sub-contracted out to others? Sub-contractors can be harder to track down if something goes wrong. Will the Builder be working on their own development projects at the same time as yours? Project focus is crucial. Trust your gut – as a species we humans are pretty good at judging whether we can work with another person pretty quickly.

5. Ask for references

Good Builders will have a few favourite clients they like to refer prospective clients to – those whose projects have gone well and with whom they have built a great relationship. But you should also speak to your architect or even other architects who have worked with them to see their thoughts on their project management skills and build quality. If you can, go and visit some of the Builders recently completed projects. Ignore the design aspects that you may or may not like and focus on the level of quality and attention to detail in the final finishes. Ask the builder if they intend to use the same team of tradespeople on your project.

You may have noticed that all of the five steps above can be done for free. They won’t cost you a dollar, but could save you plenty! If you are not confident in working through the steps yourself, ask your architect to do it for you. They know the right questions to ask and are likely to have experience working with lots of builders, so they know what to look for.

But what about the price?

Well, that is important of course but in my opinion, it is more important to remember that for a large renovation or a new home project, you will be working with your builder over a long period of time – often 12 months or more. You will also be transacting large sums of money with them too. So you need to find someone you trust, someone you like and someone with the same goals as you for your project.

When do I need to find my Builder?

Most people think that they don’t need a builder until all the design and documentation is done. Indeed, that is the time at which the Builder increases their involvement with the project but may not be their first contact with you or the scope of work.

In fact, I recommend to all my clients that they choose their builder early and work with them throughout the course of the project. They can be engaged very early on in the design process to advise and prepare preliminary budget estimates so that you know where you are headed cost-wise before you fall in love with your new house on paper. Their ongoing cost and “buildability” advice throughout the course of the design and documentation is invaluable.

If I select a Builder that early, how do I know they won’t take advantage and over-price the job?

You still have the option to put the project out to tender with other Builders. (Of course, you will have done your five-step check on each of them too, won’t you?) But the tender process does not always give you the best prices either – attention can slip if a Builder is particularly busy, there is a temptation to low-ball the price if they need the work, or a busy builder may even increase the price so they can put on extra staff to complete it.

By far the best way to arrive at the best price is to select your builder early and get to know them – building up that two-way trust along the way so that you can talk about the cost of the project freely together. It may be that your wishlist and your budget are just incompatible, so your Builder and your Architect can help you prioritise your needs and advise you on where your money will have the greatest impact. If you feel the need for an independent price check, you should engage a Quantity Surveyor or Cost Planner either to review the Builder’s price directly, or to prepare their own detailed estimate for comparison.

Results

At the end of the day, you and your builder both want the same thing – for your project to be built well, in a reasonable time and for a reasonable price. When that happens, you will have a fabulous new home to live in and will tell all your friends how wonderful your Builder was (and your Architect!). At the same time, the Builder will feel that they have been paid appropriately for their level of skill and attention and will hope that your friends will be beating down their door to have them build their next home or renovation!