How to avoid price blowouts in your new home build

Full transcript

And the price that you thought was factored in from the allowance to what you actually get offered is completely different.

So if you actually get a tender from a builder, a little trick that we use to see where there could be any risks within the price that you've been offered is literally just go control + F and search for the word "allowance" because generally an allowance is exactly that, it's an allowance. It may allow you to push over the price and what you generally see is a really common tactic is someone before they actually go away and quote the job properly, they'll just put in an allowance for what they believe something will be.

Then you'll get your deposit, you'll pay your deposit and then what happens is they go away to offer the fixed price and the price that you thought was factored in from the allowance to what you actually get offered is completely different.

Now, when we're dealing with our first home buyers we don't have any wiggle room. We need to make sure that the initial price that is offered is the true price right from the get go. And the way that I view it is there's no point in us as an entity coming to someone and showing them something that looks like a good price or a cheap price if at the end of the day the actual price is going to be $50,000 or $60,000 more than what they anticipated because that's money that they can't get, it blows out the budget and it basically just destroys the whole process before it begins.

Whenever you're looking at it we wanna make sure that everything is being done on a true fixed price basis. So everything within the contract has been factored into the fixed price component of the build contract. And what that means is that you as the buyer are offered the maximum protections that you can have.