What is Homes Owners' Warranty Insurance Cover & HWI Eligibility?

This is a compulsory insurance cover that must be taken out  on any contract between a consumer and a company or trades person that has a value of more than $12,000.

You must be issued with an Insurance Certificate BEFORE you pay a deposit on a signed contract. The certificate will show your name, address, value of the work and a description of the work to be carried out.  Only once you have received this certificate are you required by law to pay any deposit.

If you do not receive this certificate or cannot issue one to you then they would be operating illegally and you will have no protection should the work go wrong or fall apart  over the next 7 years.

If the home is to be sold within 7 years of the work being carried out, you will need to produce this certificate as part of the sale settlement documents.

Eligibility means the Builder must have thre correct credentials with an Insurance Company to be able to offer this compulsory cover.  If he is not eligible he is not licensed to carry out any work over the value of $12,000.

How much and how often do I pay a builder?

If you enter into a contract for $20,000 or less then you will be asked to pay a 10% deposit.  If the contract value is more than $20,000 then you are only required to pay a 5% deposit.

Remember, no deposit is to be paid until you have received the HWI Certificate for any contract more than $12,000 in value.

Do not pay large sums of money at the beginning of the job - eg. 50% now and 50% on completion.

A clearly listed Progress Payment schedule should be written up as part of the contract documents, and these payments are spaced apart based on the percentage of cwork completed or to cover the costs oa any custom made materials - eg. windows, kitchen cabinets etc.

The final payment should be a minimum of 10% of the contract value and is paid once the final inspection has been carried out with the builder and yourselves.

Why are there Variations during Building Work?

A Variation is work or materials required that were not included in the original contract. ie Variation to the original scope of works.

Sometimes it is not possible for the Builder to give you a fixed price for some work, this could be due to unforseen circumstances.

Example, when renovating a bathroom, it is not until the old tiles are removed that you may find that the timbner frame or floor joists are in a bad condition and may need repairs or replacing before the new bathroom can be tiled. 

The Builder should allow you the opportunity to inspect this work and explain what the additional costs will be to carry out this extra work, this should then be given to you, in writing, for you to "sign off" and the additional payment would be added to the next progress payment claim.

How long does a project take?

The builder must give you a start date and a completion date.

Check your contract conditions, but generally, a builder must start within 21 days of the contract being signed and all relevant approvals being finalised (eg. Building permit issue) or may agree to a start date that suits you.

Generally a bathroom renovation may take 2 weeks to complete, with larger extensions taking anywhere from 6 weeks to 6 months.

Regardless, there should be activity on your site everyday once work commences.

What is a PC Sum and a Provisional Sum allowance?

PC Sum - Prime Cost Item allowance - this is an estimated allowance for the supply of an item, it is generally a reasonable alowance, and allows the builder to complete his quote to you even if you haven't made all your final selections.

For example - if a new bath tub is needed, the builder will allow enough for an average bath tub.  As baths can cost anywhere from $400 to $7,000, until you have made a selection the actual price is not known.  If you select a bath that is more than the allowed amount, you pay the builder the extra.  If it is cheaper than allowed, the builder gives you a credit.

It is quite normal to have a large number of PC Sum allowances shown on a quote, you can check if they are adequate by visiting a few showrooms and suppliers.

Provisional Sum allowance - this is an estimated allowance for work that involves both supply of material and labour.  For example - supply & lay carpet - the builder may base his allowance on the supply of the required square metres for a reasonable carpet and add this to the laying costs.  Generally the labour costs do not change from carpet to carpet, but the supply of the carpet is not known until you have selected it.

Do I need a permit?

Simple answer - if you are not sure phone your Council and ask them.

Any work that involves a structural change will require a Building Permit. Your builder should obtain the permit and you should be given a copy of his permit BEFORE any work starts.

Cosmetic changes do not require a permit.  A kitchen renovation where the old kitchen is stripped out and a new one installed does not require a permit. But, if you are removing walls that are load bearing you would require a permit.

Sometimes just changing a small window to a larger one would require a permit.

All professional licensed builders are aware of what requires a permit, but all Councils have slightly different regulations.

How much will my renovation cost?

Unfortunately there is no "price list guide" for renovations.  Each and every project is unique. A lot of considerations need to be taken into account before a price can be reached for the work required.

Bathroom renovations may appear smiliar they do vary in price. When you consider how many different tiles are on the market which all vary in price it is a bit hard to guess how much the renovation would cost.

Impressions will be able to gather enough information at the initial on site visit to enable an accurate quote to be given using our experience and the discussions we have with you.

As a general guide the following budgets need to be in mind -

Bathroom renovation from $8,000 to over $20,000

Kitchen renovation from $12,000 to over $25,000

Wall removals to enable remodel of space - anywhere from $1,500 to over $15,000

Although very broad, it may help you a little.

How do I compare and judge all the quotes?

How to compare apples with apples and not apples with oranges?

It is a known fact that if you ask several builders for a quote you will receive several different prices. It is not the type of work where you can apply an hourly rate or a square metre rate.  There are both materials and labour involved.

There are a variety of methods used by builders - some will give fixed price for the majority of the work with a few allowances for some items and some may give you a quote that can vary as work progresses on site, which could end up costing you a lot more than expected.

Impressions understands the need to keep within abudget limit, not man of us havean open cheque book and al of us want to know exactly how much we have to spend.

As renovation work has so many different variations based around the same theme, it is vital that all the quotes are based on exactly the same scope of works, otherwise you will never be able to judge which price suits you best.

The best approach is to write up a good descripton of the work, list all the decisions you have made that you would like included.  Decisions about windows for exampe, timber or aluminim? slding or double hung? these type of selections greatly influence the costs.

Then as builders visit your site they all need to stick to the same scope of works. Most builders will come up with better or newer ideas about the approach, but if they all keep adding and changing the original scope you will end up with several prices for projects that are all different. 

Once you have met all the builders and taken on board any good ideas you should then select the top two and ask them to re-quote with the new ideas added to create a more final scope  works.

All the quotes given to you should clearly show exactly what is included and what is not included.

How many quotes should I get?

Depending on how much time you have and how much research you tend to do will influence how many quotes you get.

Remember, it is more important that you feel comfortable with the builder you are dealing with than trying to find the cheapest price.

Renovation quotes should all be within an acceptable range of each other not differ by large amounts. Again this will only happen if everyone is quoting exactly the same scope of works. So whether you get 2 quotes or 20 they should be in a similar price range.

The first quote that  Impressions presents to you will be based on all the information that you have given to us at that point.  We are more than happy to re-quote if you decide to change the scope of works.