Your question is a legal one. I suggest you consult an attorney licensed in your state.

I would also let this lot go. Starting off this poorly won’t end well

Find a different builder.

Agree with all the above.

Sue him for what? You don't have an agreement/ contract yet.

1) talk to a lawyer

2) the price increases are probably legit and you'll end up paying them one way or another

3) I'd have a problem with their business/communication practices. If they don't have any of your money I'd walk. It wont get better as you get farther into the project.

Good thing he showed you what you were in for before you signed. I'd say you are lucky because you dodged a 30K bullet, possibly more.

Is this a building contract or a real estate purchase contract?

"Can I sue builder just because of a clause which said they had to sign the contract within 10 days and now asking for more money."

Yes, you can sue the builder and for the low low price of $50,000 in attorney fees and a few years wasted, you could possibly get $30,000 discount on the home price.

In the American system, each party pays their own attorney fees. Judges and contracts can change that but you really need to read the contract as a change could just as likely mean your paying the builder's attorney fees as his paying yours.

"My assumption is it would not be easy for them to ask for price rise if they would have signed the agreement with me."

Many contracts will have a clause that limits the builder's responsibility for things he can't control. So I would be mildly surprised if your assumption is correct. Lumber prices are up 21% in the last 7 days and 49% in the last month. I suspect the builder would have the right to increase your house price anyway and may have the right to increase it again.

Furthermore, I am not sure the lot hold isn't cancellable by the builder. If your builder has the right to cancel the agreement then it is practically worthless.

ETA: a lot hold is a contract unless it can be cancelled.

Run. It is true that lumber prices are way up. But this is a very bad sign. Move on while you can.

“Builder didn’t sign the contract in the next 10 days". He didn’t, so, you have no contract.

You need to investigate what the cost of wood has done to builders and what he thought the cost would be to build your home. Everything has changed. Shocking, but true.

You want your home built? Then, work with the builder, and acknowledge the added cost he has to pay to get the wood. Not his fault.

$30,000.00? I think builder is taking a loss.

https://www.charlotteobserver.com/news/nation-world/national/article250841164.html

A lot reservation can often be cancelled by either party.

What hill do you want to die on? Is this THE neighborhood in which you have to live? Despite a future miserable and expensive process that will be unpleasant, at a minimum? It’s the only one in that school system, or with the neighborhood pool and tennis court? Making sacrifices for family doesn’t always work the way you think it will.

What are your other options?

I had to get a lawyer for local custom cabinet builder that refused to give me a couple samples of doors and kept changing prices. Wouldn't give me a itemized price list of each component so I could make changes accordingly. I had already given him 19k. My attorney hasn't even charged me anything yet except for the first consultation. I can only imagine my bill!

Hindsight is always 2020! I would do everything I can to work out a compromise and move forward. The headache and loss of a year of my life was definitely not worth it!

Thank you all for you inputs! As most of you suggested I may need to let it go :(

Well, building a house always costs more than you thought and this ia just beginning. Wait til you want the nicer appliances, better carpet, on and on. This is a rough start, as already stated.