(builder) requesting an increase of 30% on original firm (contract) quotation.
Anonymous user 28/02/2024 - 4.01 PM
HI all, hope you are keeping well.
I shall keep this as succinct as possible.
In April, we agreed a firm quotation and contract (with stages of work, payment plan structure etc) with a builder (who has also taken on/completed work on other properties in our surrounding streets).
The contracted work was for 12 weeks, which has now elapsed, and we are half way through the works and payment schedule - unforeseen inclement weather, delays in materials, errors from other providers/manufacturers are irksome, but acceptable reasons for this.
I have no issues with the proficiency of work, but have recently received note that following their "project assessment", due to the current demand/issues within the trade for material costs, availability, etc - they have calculated that the total project will now cost towards 30% more than the firm quotation agreed upon in our contract and they can no longer look to absorb this- thus, seemingly abrogating the agreed contract quotation and forced to request an increase in prices of their work (renegotiate a new payment plan).
Surely a contract/quotation is a calculated risk of a builder? and rather inexplicable to then request to pass on price increases occurring after agreement of the contract (to the client) ? (when there has been no deviation away from the agreed works to be completed)
Nota Bene, the contract actually had a clause in it after stage 1, whereby if the homeowner(s) were unable to vacate the property within a certain time frame from the date of contract execution (to allow for works to proceed to stage 2) - then there would be liability for an increase in the quotation price, in line with product price increases.
We adhered to this time frame and gave written confirmation of such - so a request of a price adjustment, inter alia, on the grounds of a situation they were fully aware and knowledgeable of at the time of agreement, surely has no credence? As it's plausible more materials could have been purchased further in advance?
If i may ask so, what would you advise to be the best steps forth? (subsequent to a discussion with the builder). Would an independent assessor/ or other builders to give a quote on the work carried out thus far and the remaining work to completion, to see if it fits in line with the request being made, be of sound, reasonable reference at this point?
Thanks in advance.
Are you a tradesperson and able to answer this question?
while i understand your annoyance, nobody could have realistically foreseen the shortage of materials we are currently seeing, just as no one could have realistically foreseen the substantial increase in raw material cost, while you can to a certain extend run on a far smaller profit margin it would be suicidal to run your bushiness at a loss to keep some customer happy, at the end of the day the builder still have bills to pay staff to pay mortgage to pay and of course food to find, ITS VERY DIFFICULT AT THE MOMENT TO QUOTE IN ADVANCE AS PRICES ARE CLIMBING AT AN UNPRECEDENTED RATE. i know a friend who have stopped building new houses because the prices have rising so much & eventually you wont be able to find a decent builder because they wont be able to afford to live, you cannot continually work for nothing or at a loss something has to give, as for purchasing materials in advance I have done that only to find when i wanted the materials they had sold my materials to someone else meaning unable to finish that job because i have no materials, i does not matter what you do at the moment nothing works prices keep climbing and nobody knows when or if they will ever stabilize.
you really only have two choices ,
either stick with the guy you have and agree a new price ,
or sack the guy & employ someone else if you can find someone.
Look under normal circumstances when you quote , you allow a certain percentage for misdemeanours and fluctuations and things that might crop up.
But what we are witnessing here is unprecedented rise in material prices.
To give you an example I have a supplier that was paying $1800 for shipping a container from China before COVID …
Now he’s paying £13000 how do you legislate for that when quoting for a job…
So while I’m sympathise for you o fully understand the builders predicament
Unfortunately it’s a no win situation…
If your happy with the work what you going to do . As he’s not trying to rip you of he’s simply passing on the extra cost which he’s experiencing
You agreed a price from the beginning that you was Both happy with so the place to stay you the same if on the other hand all building materials went down with the builder go back to the client and say I’m going to knock 30% off the price because everything is so much more cheaper now
We aren't even bothering to tender due to price increases every day/week. We are offering build management packages which I think is the fairest way for both parties at the moment
The present rise in material cost is astronomical but that said once a price has been agreed and works started then a contract has to be honoured.
A contingency would have been in place for weather and delays , Materials should have been sourced and order's placed before the works were started especially on a 12 week project this way any increase would have been flagged up.
As I say a contract is binding not only in favour of the writer
