Drafting New Build Home Change Orders
Published on 29 August 2022, 07:22:56 AM
Your home is everything you imagined, except for a few change orders you want to make here and there.
Be precise when you prepare new build home change orders for construction work. Your home contractor could be charging you for change orders. Time you read your new home construction contract to see how it handles change orders.
Quick Read
What Should Be Included In a Change Order
Your Architect’s Role in Change Orders
How to buy a new build house.
What Triggers a Change Order
Change orders are written instructions directing a new build home contractor, or renovator, to downgrade, upgrade, replace, or delete materials or specifications in the agreement of purchase and sale contract.
New build home contracts describe the goods and services your contractor will provide in exchange for the price you agreed to pay. When you consistently make change orders that price can fluctuate, leaving you with unpleasant surprises when you receive the final tab for labour and materials.
Change orders can be triggered by the contractor or architect to:
- Reset the construction completion date if labour or material costs increase.
- Respond to requests from municipal building inspectors.
- Revise the design if the floor plan needs to shrink to fit on a smaller lot.
- Compensate for engineering problems, like an underground spring, discovered after construction begins.
- And more.
Home buyers trigger change orders by:
- Deducting fixtures included in the contract. Who needs those natural gas jets on the outdoor patio when you have a propane BBQ?
- Adding design elements. Think high end tub in the master suite.
- Switching finishes. You heard Corian countertops don’t need sealing the way granite does.
- Adding labour costs when you change your mind about things like what colour to paint the foyer, after the work’s done.
Buying a new build home in Ontario? Keep this in mind.
Find a new home builder in Ontario.
How to Handle Change Orders
You could be facing a bill for between 1% and 10% more than you were originally quoted. If money is an object, keep a tight rein on how many change orders you approve.
Refer back to the scope of work included in your new build home contract. The scope describes the project. Yours likely includes drawing plans, material specifications and installation instructions, project timelines, information about who will complete the work, and what’s excluded from the project.
Before you sign off on a new build home contract, ensure the scope of work sets out how change orders, delays that might cause, and any costs they incur will be handled. Talk to your contractor and, if you have one, architect about who can make change orders and how extra costs will be approved.
Resolve a construction dispute.
What Should Be Included In a Change Order
Expect to pay more if change orders add time or material costs. When you can’t agree on the cost, a compromise is to pay the actual cost of the materials or labour, plus a reasonable profit and overhead expenses for the contractor. Ontario law on paying contractor invoices (see 6.1-6.9).
A typical change order includes:
- Your name and the contractor’s.
- The project address.
- Who requested a change, why, and when.
- Details about the change, such as specifications for new materials.
- Additional time or costs involved.
- How it affects the price, and the new total price.
- Who accepted and approved the change.
Ensure the change order is discussed, and time or price changes approved (you and the contractor should sign), before proceeding.
Amend new build agreements of purchase and sale. What to look for in the pre-delivery inspection.
Your Architect’s Role in Change Orders
How you involve your architect in change orders depends on what the order is for and your relationship. Your architect guides the design and construction by consulting with you, engineers, the general contractor, materials suppliers, the municipality, and many others on the final product. Search for Ontario architects.
What should an architect do if an owner makes change orders? New build homes are a work in progress, and small details can make a difference in the quality of the product an architect delivers. Besides, your architect genuinely wants to give you a home that’s safe, healthy, and worth all the effort they and you put into it.
Talk to your architect if you have ideas about changes you’d like to see. Your architect can advise on what to do if you are going over budget, want to add or deduct spaces, or change the appearance of your home.’What to do when new construction is not ready by closing. Tarion coverage for new build house delayed compensation.
Speaking up now can save the aggravation, and expense, of having to change it all later.
Why You Need a Real Estate Lawyer
Axess Law has a real estate lawyer near you who can review your new build home agreement of purchase and sale. We read the fine print for terms and conditions you may not understand. If your contract has unusual features or locks you into conditions that may not protect your legal or financial interests, we discuss those with you. What’s in the agreement of purchase and sale.
Axess Law adds title insurance to your new home when we register the title at your local land registry office. It protects you from clerical errors or title fraud schemes that can compromise your ability to mortgage, enjoy, or sell your home in future. Your licensed real estate lawyer negotiates with the builder’s lawyer if you have specific requests to change their standard contract. What happens to deposits if you cancel.
What to bring to your Axess Law appointment.
Finding financing for construction draws for new build homes can take awhile. Axess Law requests amendments to your agreement of purchase and sale if completion deadlines have you up against the clock. We refer you to trusted legal partners for advice if a new build contract appears irregular, or your contractor substantially increases the final invoice beyond what you think it should be. How many times can a builder delay closing in Ontario?
Axess Law can discharge the mortgage on your existing home when it sells, or you are ready to move to your new residence. We can transfer title to the property to a family member, or include a spouse, common law partner, or anyone you want (except minors) when we register title to your new home.
25 questions to ask real estate lawyers.
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Access lawyers for less in Greater Toronto Area, Ottawa, or anywhere in Ontario when you buy, sell, or transfer property. Axess Law’s flat fee real estate lawyers are affordable, and our rates are all inclusive (excluding taxes, disbursements, and third-party charges). Axess Law offers you only the legal services you absolutely need. Your final invoice includes no surprises or hidden charges. Your itemized statement of adjustments is explained when we deliver it, and we answer any questions you have about it.
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