The Fixed price contract explained

The Fixed price contract explained

All builders loosely use the term ‘Fixed Price’ However, this is not what you expect it to be.

In every situation, a “Fixed Price” is” fixed” based on certain conditions.
So, what are those conditions, and what if they change?


PC (Prime Cost items) and Provisional allowances.

BEWARE

Most builders put PC sums and Provisional allowances into their quote or tender. These could be for the Kitchen, tap ware, sanitary ware, connection of services, bricks and many many other items. The way it is normally done is a nominal figure is allowed which would cover basic items. So, when you get to do your selections, you pay the difference between the basic item and what you wish to include.

Or, if it has to do with the service connections, if the connection length is more than the allowance – or if the builder hits rock, you will be charged extra.

This is not exactly ‘shonky’ practice… it is very normal in the building industry. That is why there are so many stories of persons who have been disillusioned, disappointed and burnt. People who signed a contract in good faith that it was “fixed” only to find out that throughout the building process the meter was ticking every time they made a selection or if there was a construction issue on site requiring extra work not allowed for.


Do not fall for the P.C or Provisional allowance trap.

It is exactly that… a trap. It is a lazy way for a builder to quote, and inevitably the allowances do not cover what you will finally select. Take the time to check exactly what you require and make sure it is included in the price at the outset.


What is different with a Bellriver price?

At Bellriver, we are committed to making sure our clients get no nasty surprises and that the price on their tender is the price they will pay. Period. The only change to that is if our clients specifically want to make changes or upgrades.


How can we do this?

With much difficulty! Pricing via the PC and Provisional Sum is easy and quick to do. Providing an absolutely no questions asked true Fixed Price takes a lot more work, due diligence and time. We go on to every site, do specific soil tests, rock tests, fill tests, compaction tests and contour surveys. Then, armed with that information, we get a civil engineer to assess the best way of building your home, the necessary site cuts, piers, fill and driveways, paths and retaining walls if required. We determine the position of the service connections and price those accurately. We then price your home, with any modifications you require, to an agreed specification level. This level of specification will provide you with a fully completed home ready to move in – complete with heating/ cooling, blinds and light fittings… even the doorbell!

No other builder in Australia does this. We are the only builder who can proudly say… the price on your tender is the price you will pay. Period. Even if we hit rock. And the only thing it is subject to is changes that YOU wish to make.