9 things to check before signing your HIA Building Contract
What to know before signing a Home Building Contract
Received a draft copy of your HIA or Master Builders building contract and want to understand it better before signing?
Who doesn’t want to understand what they're committing to when purchasing probably the most expensive thing in your lifetime!
Building a new home is a huge undertaking, and you don’t know what you don’t know. If you make a mistake, it might end up being a huge burden on your family.
To get to the stage of signing contracts, you’ve done amazing job! But when the Building Contract hits your lap it’s time to bring a contract specialist in —they’ve seen it all and can catch issues before they become big (and expensive) headaches. Plus, they’re there to look out for you, making sure everything stays on track. It’s not an added luxury—it’s the key to making your build as smooth and stress-free as possible.
Hi, I’m Annelyse - a building contract specialist - I protect clients from all the things that can go wrong in the home building contract. Here are my tips on what to look for to in your Master Builders or HIA Home Building Contract before you sign:
What should I look for before signing a Home Building Contract?
Here is a nine point checklist of what to check in your contract before you sign:
These nine items are a small part of what I cover in a Building Contract Health Check - my Australian home building contract review service designed to give you peace of mind that everything is clear, and there are no hidden costs or surprises that could blow your budget.
9 important things to look for before signing a Home Building Contract
Here’s the list of nine things to check are covered in your HIA building contract before you sign:
Clear Start Date
Make sure the date for when building works will begin it’s clear what can cause delays. In most Master Builder and HIA home building contracts, works will start a specified number of days after the list of items that the owner needs to provide is sent - make sure you know exactly what’s on that list, and when you can provide each item. It’s important to have clarity on when works will start and how to estimate that date.
Reasonable Liquidated Damages
Ensure the daily rate for liquidated damages represents a genuine pre-estimate of costs - too often I see Liquidated Damages set to $0. Liquidated damages are a pre-agreed compensation rate that the builder would pay you for each day the build is late. They are calculated to cover reasonable costs you will incur due to delays (like extended rental costs). Having liquidated damages in the contract provides clarity on the steps to follow if a build is late and encourages timely completion. If your not sure how to calculate liquidated damages, it’s one of the key discussion points in my Building Contract Health Check service.
Understand the Special Conditions
Make sure you understand how any builder proposed special conditions impact the general conditions. Generally stay away from special conditions that touch on price increases, delays or EOT entitlements as these are already covered in detail in the General Conditions and amendment requires careful consideration of the wider contract implications.
Order of Precedence
Ensure the order of precedence between the contract and design documents is clear. In most cases, the Special Conditions sit ahead of the General Conditions followed by specifications and plans.
Procedure if the builder discovers ambiguity in design drawings
Make sure there is a clear procedure to follow if the Builder discovers an ambiguity or discrepancy in the documents and you have the opportunity to give instruction on how to proceed. Be cautious of clauses that allow the builder to make substitutions without your prior written approval.
Authority Approvals
Ensure the responsible party for obtaining Authority Approvals (e.g Building Permits, Planning Permits, Occupancy Permits, utility connections) is clearly defined.
Delay Clauses
Review the acceptable reasons for extension of time events in detail before executing your HIA building contract. Check a notification process is described in detail and that the reasons for delay are clear.
Investigate ground conditions
To help avoid variations, when applicable ensure foundation testing has been completed before the contract is executed. Clarify with the builder that the findings of the foundation testing has been incorporated into the building contract.
Working Days
Ensure that the Working Days your Builder will be working on-site is expressly clear in the contract. This is important to ensure any extensions of time can be assessed fairly.
I hope this gives you a clearer idea of what’s really important to understand in your Master Builder or HIA Building Contract (and what to be wary of!). Signing your New Home Building Contract doesn’t need to be a complicated or scary process - the more you understand the finer details, the easier managing it all gets.
Building a new home is full of moving parts, and without the right experience, things can easily get messy. That’s where my Building Contract Health Check really helps —I’ve seen it all and can catch issues before they become big (and expensive) headaches. Plus, I can look out for you, making sure everything stays on track. It’s not an added luxury—it’s the key to making your build as smooth and stress-free as possible.
Protect your dream build with a Building Contract Health Check:
Avoid budget blowouts before they happen
Lock in a quality control processes
Save your future self a huge amount of stress
Save thousands by spotting the hidden risks first.
Thanks for reading and catch you on my next post :)
Annelyse
Building Contract Specialist | B.Construction Management | M. Construction Law
