Choosing the builder is a due diligence exercise
The single most consequential construction decision happens before the first slab: which builder. Price matters, but the cheapest tender from a builder who fails at month seven is the most expensive quote you will ever accept. Serious developers check the builder’s licence and history, financial position, current pipeline (a builder drowning in work is a schedule risk, a builder with no work is a solvency question), references from recent projects, and who will actually run the site day to day.
The contract does the heavy lifting
Small residential projects are typically delivered under a fixed-price, fixed-time lump sum contract. It transfers a great deal of cost risk to the builder, which is the point. But fixed does not mean immovable. Three things routinely move:
- Variations. Any change to the documented scope, priced by the builder, rarely in the developer’s favour.
- Latent conditions. Surprises in the ground: rock, water, someone’s 1970s septic ambitions.
- Prime cost and provisional sums. Allowances for items not fully specified, which have a talent for growing.
The defence is unglamorous: complete documentation before tender, a genuine contingency in the feasibility, and disciplined, written management of every change. Progress payments are made against certified work, usually checked by a quantity surveyor on behalf of the lender, so money follows verified progress rather than enthusiasm.
Then one day the certifier issues practical completion, the defects list gets walked, argued and fixed, and a set of drawings becomes addresses. It never stops being satisfying.