FAQs

Do I need a Licensed Contractor?

All builders (individual or company), building designers and most trade contractors who are carrying out or organising building works valued at over $3,300 (including labour and materials) must be licensed by the Queensland building and Construction Commission (QBCC). You should contract only with someone who has a QBCC licence card. Click here to view our licence details.

What is a Preliminary Agreement?

Undecided on what style of house you want to build or what renovations you want done? Haven’t finalised any plans yet or only have rough sketches of your ideas? Unsure what’s required or how to go about obtaining Building Approval (BA)? Will I need to engage a surveyor, do we require soil testing, engineering? If you answered yes to any or all of these questions, a Preliminary Agreement may be for you.

Entering into a preliminary agreement for the pre-construction design phase of your proposed project will ensure a collaborative ‘end to end’ building process guaranteeing all your project requirements are understood and incorporated for a mutually rewarding building experience.

The preliminary agreement includes our services and outlines the costs involved in obtaining a full set of ‘For Construction’ plans and structural engineering designs, engaging a surveyor for site investigation to identify the block (Contour ID) and soil testing, demolition if required, preparation of a detailed construction proposal, Energy Efficient Report, and lodgement of documentation with a Private Certifier to obtain BA.

Elysium Built will professionally project manage all aspects of the pre-construction stage, including all approvals and certifications, from start to finish taking the pressure off you especially if you are time poor or inexperienced.

If I enter into a Preliminary Agreement do I have to sign a contract with the builder?

No, you don’t have to sign a building contract. A preliminary agreement is a separate contract signed by you and the builder to carry out preliminary work. This type of work is usually defined on the agreement and can include things like soil tests, plan preparation, engineering, foundation design and site survey (refer Q2.)

Although you may have a contract for the builder to carry out preliminary work you may not have a right to use the plans with another builder for reasons of copyright. If you decide to build with another builder then you may be required to purchase the copyright to proceed.

Some preliminary agreements give the owner a discount if they proceed with that builder.

Do I need an Architect, Draftsperson or Building Designer?

We are constantly asked this question and our answer is always the same: there are numerous benefits to working with any one of these professionals, it just depends if your project is straightforward, on how much detail you already have and the level of service you require.

At Elysium Built we encourage an ‘end to end’ building process and we believe that it is vital that your builder is involved in the initial discussions when deciding on ‘who’ to work with on your design.

Elysium Built have spent considerable time selecting a panel of designers and we are confident that we can match the level of designer to your project to ensure you achieve the best outcome for your budget. Talk to us to learn more about the differences and services offered by these professionals.

How much deposit can the builder charge for home building work?

If a deposit is payable, make sure it is within the legal limit.  In Queensland 10% if the contract price is less than $20,000 and 5% if the contract price is $20,000 or more.

What is Warranty Insurance and what does it cover?

Warranty Insurance in some States is called Statutory Insurance or Home Indemnity Insurance. The insurance coverage varies widely, depending where you live. In most States, except Queensland, it is considered as “last resort insurance” and only covers situations where the builder abandons the work for reasons of death, bankruptcy or injury. In other States, like Queensland, the insurance covers the owner against major defects to the work for a period of six years and six months.

Warranty Insurance should not be confused with Contracts Works and Public Liability Insurance, which is sometimes called Builders All Risk Insurance. The insurance covers fire, damage, theft and injury during the construction period while the builder is in possession of the building site.

Can the Builder increase the Contract Price?

Most contracts have provision for variation, prime costs and provisional sum items. When a situation arises which is not the builder’s fault then the builder does have a right in most cases to increase the price of the home. However, state laws limit the circumstances and the amount by which a builder may increase the price.

Further, in all cases, the builder must follow the variation procedure set out in the contract.

When can the builder make a variation to the contract?

Most contracts allow the owner and builder to make requested variations. The contract sets out a process for each party to request a variation. Where a party may not agree and disputes a variation then the parties are referred to the dispute procedure under the contract.

Some States require the parties to sign a variation before proceeding. However, it is not always possible during a critical building process and the contract allows for this situation.

Remember that provisional sums and prime costs are not usually defined as variations and the contract sum is adjusted without a variation being required. The contract will usually set out the payment stage, or at the end of the contract.

When can I request a variation to the contract?

A variation can be requested at any time during the contract and parties should refer to the variations clause in the contract. Generally, when you request a variation, the builder has the option to agree or refuse to carry out the variation.

What are Prime Cost items?

A Prime Cost (PC’s) is an agreed, reasonable estimate for the supply of materials (fixtures and fittings) which you may not have selected at the time of entering into the contract. Usually, PC’s are one-off items, however they can relate to a large number of items for which the labour which goes with that item has been included within the total price and the PC amount is to supply the item only. An example may include bathroom items.

What are Provisional Sum items?

A Provisional Sum (PS’s) is a reasonable estimate included in the contract to cover the labour and materials, the extent of which cannot be specifically detailed when entering a contract. PS allowances are often used for excavation where the exact quantities are not known or things such as a kitchen which the price would include to supply the cupboards and bench tops as well as the labour to install.

Can I withhold a progress payment from the Builder?

First you need to establish if the contract permits you to withhold, offset or cross claim. Many building contracts only permit the owner to consider this type of action at practical completion.

Other than in relation to the final claim, payment of a progress claim is on account only and any such payment is not to be taken as evidence against or an admission that the works have been performed in accordance with the contract.

You should always seek your own legal advice before deciding not to pay a progress claim as potentially you may repudiate the contract. This could lead to substantial and unnecessary additional costs to you.

Always put your concerns in writing to the builder and seek a written reply. Remember building contracts are legal documents and if you do not understand them it is time to call your own solicitor.

Can the builder charge interest on late payment?

Yes, most contracts give the builder a right to charge interest on late payment the same as any other commercial transaction. The contract will refer to the clause that relates to default interest. Generally, you must pay the builder default interest on any amount that is unpaid if it is over the contracted payment date.

What is the meaning of Practical Completion?

Practical completion is the stage when the works have been completed in accordance with the contract. Most contracts define the meaning of practical completion and in some States, there is a statutory meaning which building contract must comply with.

Generally, practical completion means the works are completed to all relevant statutory requirements (apart from minor defects or minor omissions) and is reasonably suitable for habitation. Some examples of minor defects or omissions may include paint chips or missing cupboard door handles.

It is important to realise that practical completion and hand-over do not necessarily occur at the same time. The builder will call practical completion and set down handover to be some time later so that the owner has an opportunity to inspect the woks and record defects.

What happens if I notice defects after practical completion has occurred?

The defect liability period under the contact is different from the statutory warranty defect period.

The contract will set out the builder’s defect liability period which can range from three to six months from practical completion. Some States require that the builder rectifies major defects for a period of six to 10 years and have warranty or statutory defect insurance to protect consumers.

At Elysium Built we follow a strict 72 point quality assurance checklist to guarantee quality of workmanship. We also offer a 10 year structural guarantee and 12 month defect liability period for any minor cosmetic defects.

It is important to remember that normal wear and tear, defects in things that are covered by their own manufacturers’ warranties such as stoves, and items requiring normal maintenance from time to time, are not defects which the builder is responsible to come back and fix.