Can I go around my builder to confirmation a contract price and its de
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2 years ago
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Comments (11)One more thought about a Shared Savings clause. I might be concerned there would be some potential for abuse there. Theoretically, it would encourage the builder to save money along the way. However, it could also cause a builder to set an artificially high GMP so he would be ensured some shared savings bonus without working very hard. It might also encourage an unscrupulous builder to cut corners (use a cheaper electrician rather than the better but slightly more expensive one, etc.). This "always go cheaper" mentality could cause some problems down the road. We decided that we wanted to use the most reasonably priced but high quality supplier, rather than always going for the cheapest, and our builder has a few trades that he uses over and over because they are very price competitive, good, and show up on time. Also, the GMP is necessarily inflated already, because there has to be some wiggle room if concrete prices go up, OSB goes up, roofing materials go up - you get the idea! It can also vary between suppliers. For example, when putting together his bid, our builder called two of his regular concrete suppliers. One was significantly less a yard than the other, which made a huge difference because we have a large foundation as well as a raised terrace and screened porch with masonry columns - so lots of concrete. Just something to think about!...See MoreCross-post: Being jerked around by spec home builders?
Comments (10)A couple of quick thoughts: 1) If I were you, I would explore what it takes to get your "earnest money" back. Your best leverage is the willingness to walk away from the deal. 2) You should not allow yourself to be held financially responsible for their realtor's mistakes. 3) The rush to have you make decisions is a calculated (or at least well practiced) attempt to get you to make mistakes and agree to things you wouldn't otherwise. 4) You should require your realtor to stand up for your interests rather than (hint, she'll do more if you threaten to walk away from the deal) 5) If you go through with the deal, I would strongly suggest a pre-drywall inspection. I would have little confidence the builder isn't cutting corners on the build. 5) This sounds like a crappy situation with numerous bad actors (the builder, the realtor(s), and likely the subcontractors working on your home), but to get an acceptable outcome, you need to take ownership of the situation. 6) If you're enough of a pain, stand up for your rights, talk about a pre-drywall inspection, lawyers to force builder to perform, they will likely be willing to give your deposit back....See MoreNew Build - Questions for Builder Before We Sign a Contract
Comments (133)@Rai Kai … I did learn so much!! Thanks for your contributions! @Beckysharp haha. I will be doing more research with the lawyer. I think overall my realtor was good—but I am not sure if overall we were the right fit. We will see if we stick with her. I know she put a lot of work and time into it --- so I do feel bad about us not going through with it. I will be doing more research and googling, and reading and using all my resources! Promise! @PitrateFoxy – I’ll probably be doing some research on a lawyer to have “on call” when we are at that point. You all were so right about all the other things – and I’m sure a few extra hundred bux (what like 500? ) will put me more at ease as I don’t like surprises unless they flowers, chocolate, or kisses :D @bellburgmaggie – isn’t that the truth. Alos.. Houzz app isn’t going anywhere! I love your story about finidng the right place! Man.. 3.5x your investment!! AWESOME!!! Were you ever concerned about over improving? That’s my biggest fear, especially if we buy very low… You know I always imagined buying the house with the crappy wall paper, shag carpet and pink or green tile in the bathrooms a horrible kitchen and then putting in my DREAM kitchen (or as im learning from houzzers, my 99% dream kitchen!). I think that’s something I was struggling with buying new. Even though I got to make a few selections… it wasn’t tailored to me really. So asking my husband in 3 years to redo the layout of the kitchen wasn’t going to fly :D Location location location is so hard for us. We are transplants – with family in the area, but are having a hard time finding the “right” home town. Everywhere we look is “safe” but I really want that neighborhood feel. I moved to Texas because I love saying yes sir, no ma’am, and I want to raise my kids like that. Sweet tea on the porch and waving to your neighbors. I want to make meals for new moms, or help out my grandparents when they need it. I may not have the Texas accent, and as the saying goes “I wasn’t born in Texas, but I got here as soon as I could!” @jannicone – I’m not deleting Houzz!! Just Realtor, Trulia and Zillow :D It may only last a week, but I need some distance! But I will use it as a resorce to keep an eye on the market and see what really happens during “selling” season. Happy to be sorta liked! @Denita , I should know better. I’m a firm believer that EVERYTHING is negotiable and if you aren’t willing to make any changes (they may not have lost me if they let me go to the design center and let me have 2 extra days – would have cost them nothing) I’m not inclined to play ball. Especially in an industry where negotiation is nearly expected. Looks like I have some more homework and research to do! I may need to find a new realtor. Not that she wasn’t good. I felt like she was doing a good job – but I’ll never know if she asked the builder for things. She did make us feel like her only clients, and she was very attentive and listened to my concerns. But I did get a slight feeling that she was “building” up the home a little more than she should have. We signed a contract for 6 months with her. She led with “if at any time you are done with me, I’ll just rip it up.” Who knows if that will come back to bite me in the butt. But, also thought we were going to end up with the first house and it would all be over. Again, lack of experience on my part. I've done some research on how you should select a buyers agent... and I did kind of do it all wrong....See MoreContract with Custom Builder
Comments (26)Custom builders do use allowances. Unless you specify EVERY detail up front then they have to. Ours is a custom build (https://bamasotan.us if you'd like to check it out) and we had allowances. Other things in the contract do indicate that this a production/tract builder, not custom such as specifying the plumbing fixtures, toilets, flooring, etc. A good builder will have preferred suppliers and contractors - that is one of the things you're paying for. A good custom builder will give you options and recommendations for who to use. E.G., they may get bids from three HVAC contractors, tell you the pluses and minuses, and let you choose which one. A good custom builder will not have any problems using others unless they have concerns about their quality or integrity. There is no concept of 'upgrade' with a custom builder. Cost Plus may generally result in a better quality custom house. However, the builder should provide an estimated cost prior to signing a contract and their fees should be based on this. E.G, if insulation comes in 10% higher than estimated then you are responsible for the 10% as well as the builders 14% (or whatever) on the estimated amount but the builder should not collect their 14% on the overage. If you request a change that results in a higher cost then the builder is right to collect their fee on the full amount. Expect to finish the project 20% or more over budget. Some things will simply come in more expensive than estimated and some things will cost more than estimated by your own changes. Hopefully nothing over budget because your builder told a supplier to charge an extra 20% on your project to save money on another project they are doing for them....See MoreWestCoast Hopeful
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