Changing your plans after the contract has been signed can easily cost you a lot of money.
You may have heard people discussing ‘variations’ when they talk about building and renovating. If you have not, it might be a good thing that you’re reading this article.
Variations can simply be the root of a lot of unexpected expense and an unforgettable experience, and they are often completely avoidable if you know what you’re doing.
What are ‘Variations’?
The term ‘variations’ refers to changes to what’s been agreed upon in the signed contacts whether that be design or building contracts – or any contracts, for that matter.
Let’s say, for instance, that you’ve settled in a hurry on a certain style of tiles for your bathroom, and that the style you’ve chosen has been written into your building contract. At some point during the project, you find out that you’ve chosen the most appalling tiles in the catalogue. And you request that the bathroom can’t possibly be built using these tiles.
If you choose to tell the builder you need to change to a different style of tiles, you will normally be liable for a variation to the original contact and the builder can rightly charge you a lot more for it… Especially if they’ve already bought the original tiles.
7 Things You Must Know Before Designing a New Home
Why Are Building Variations Expensive?
There are plenty of reasons why variations to contracted work cost a lot. The first reason why is that a building contract is a legal document – and to get it changed it may require the services of a lawyer.
Other things that can contribute to costs in variations are:
- Cost differences between specified work or products and updated requirements
- Pre-agreed penalty clauses for variations
- Extra material costs (especially if materials have already been bought)
- Added labour or work costs – particularly if work has already started, if variations require alterations to completed work or plans, or if there’s a need to call back tradespeople to the site
- Added engineering, drafting or approval expenses – especially for revisions to structural work, which can easily cost three or four times more than just materials and labour
A bit of variation room usually is necessary on a project as big as building a house, but if there is a scope of allowed variations, it’ll also need to have its limits and conditions. To be clear, builders often need to request variations too, where original plans mightn’t turn out to be the best, most practical or most sensible option.
How to properly manage variations
If you want to request variations of what is in your contract, your builder will usually provide a quote for the cost of the variations, its’s then the matter of:
- agreeing to changes and costs (in writing),
- negotiating a different solution or
- biting the bullet and continuing with the original plans.
- Insist that prices and all the details of variations required are put in writing and signed off by both parties before work is done.
- There’s a difference between being friends with your builder and having a good professional relationship. Many bitter disputes begin with the assumption that everyone’s friendly enough to put the paperwork aside till later. It’s in everyone’s best interests to ensure that there’s absolute clarity and a well-managed paper trail when it comes to anything to do with contracted work and payments.
- Depending on what’s being requested, you’ll need to remember that variations can have a very significant impact on deadlines and completion dates too.
Why do people need to request variations?
When it comes to homeowners. The need for variations is usually the result of miscommunication, misunderstanding or rushing in without being thorough enough with contracts.
Conflict often arises over what’s been agreed upon and whether or not it is actually a ‘variation’, or a fair interpretation of what’s stated on the contract.
Lack of detail in contracts and miscommunication are often the cause when it comes to variations and disputes – particularly when people realise that they’ve accidentally settled on very basic items, or a set “prime cost” (PC) budget for the builder to purchase unspecified products.
A good example of the PC trap: people very often realise halfway through their building or renovation project that the money allocated for bathroom taps will only be enough for the most basic options, when they’d prefer a more expensive chrome option. You can never be too detailed in planning…
Click Here For More Helpful Information
The more common variations people request include:
- variations in design
- variations in quantities
- variations in models and styles of products
- variations in quality
- variations in the order in which things are constructed
And as we have already mentioned, sometimes it’s the builder who needs to request variations, perhaps because there’s an issue with the original plans, or an unforeseen issue with the site. Make sure your contracts very clear about the need for the builder to submit detailed requests for variations in writing, along with any changes proposed costs.
How to avoid variations
The best way to avoid expensive variations is to be well prepared. Be very thorough, careful and involved when it comes to planning – and never sign a contract until you’re certain it’s absolutely specific about everything you want.
This means making sure your contract includes things like:
- brand and model names for things like toilets, taps, power points, door handles, locks, rangehoods, light bulbs etc.
- specific detail on the number of coats of paint to be used, texturing / application preferences etc.
- specific colours, shades and products to be used
It’s also worth ensuring that your contract is very clear about any work that’s going to be done by other contractors, about local building regulations or restrictions, and about the need to consult you, or your building designer or architect on any product choices or deviations from what’s been specified.
Is it true that variations are used by builders to trick unwary customers?
Builders rely on word of mouth for business and it is in the majority of the builders’ interests to avoid disputes and make sure their customers are happy. It’s also true that for most builders, variations are a potential source of trouble so if they’re professional they will normally do their best to make sure there’s no misunderstanding on your part.
There are instances where cowboy like builders’ prey on less informed customers though, by under quoting and then pushing up their margins by severely over charging for the variations you’ll inevitably have to request.
The best way to avoid this is to be very thorough about what you want, research and choose a highly trusted builder and always make sure you are suspicious of unusually low prices.
Click here to find out The 7 Things you must ask before signing your building contract
