Is it normal for an admin fee to be charged on top of the cost of a variation change to a new build?

Discussion in 'Development' started by Andy Bozzly, 27th Jul, 2021.

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  1. Andy Bozzly

    Andy Bozzly Member

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    Hi all

    The following clause is included in our builder's contract for a new home build.

    "If a variation is requested by the owner and accepted by the builder after signing of the contract the owner will pay an administration fee of $1,000.00 in addition to any cost of the variation for each accepted variation"

    I understand that it must be a nightmare for builders with clients who are constantly making changes after the final plans are made, but $1,000 per change sounds ludicrous.

    Has anyone seen this in their contract and what is the going rate?

    Thanks
    Steve
     
    Andy Bozzly, 27th Jul, 2021
    #1
  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    Here in Perth it's anywhere between $250-350. Enough to encourage you not to do it, but not too much that you don't ask for something you really really really want.
     
    Westminster, 27th Jul, 2021
    #2
  3. Joynz

    Joynz Well-Known Member

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    Just get everything in the contract to start with!
     
    Joynz, 27th Jul, 2021
    #3
  4. wylie

    wylie Moderator Staff Member

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    Sometimes variations can't be helped, and I wouldn't want to pay $1k admin fee per variation.

    We had a number of variations on our development, some gave us back money when it was a change not asked for by us. Others we paid cost + 10% from memory.
     
    wylie, 27th Jul, 2021
    #4
    Tufan Chakir likes this.
  5. Tufan Chakir

    Tufan Chakir Well-Known Member

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    It's excessive. Sounds like you are being asked to sign off on a contract that favours the builder at each turn. Is it a standard HIA or Master Builders contract, or one put together by the building company?
     
    Tufan Chakir, 28th Jul, 2021
    #5