Fixed price vs cost-plus: what 'no surprises' actually means
Two contract types decide who carries the risk of a build going over budget — you or the builder. Knowing the difference is worth more than any discount.
After a few well-publicised builder collapses, Sydney clients have learned to read contracts before falling in love with floor plans. Good. Here's the clause that matters most.
Cost-plus: you carry the risk
In a cost-plus contract the builder bills actual costs plus a margin. If materials rise or the build runs long, your bill rises with it. It has legitimate uses — complex renovations, unknowable sites — but for a standard new home it mostly transfers risk to the person least able to price it: you.
Fixed price: the builder carries it
A genuine fixed-price (lump-sum) contract locks the number at signing. If timber prices jump in week three, that's the builder's problem. The catch: watch for provisional sums and PC items — allowances inside a 'fixed' price that can still move. The fewer, the more honest the number.
The protections that back the paper
- HBCF (home building insurance) certificate issued before any payment
- Deposit capped at 10%, payments staged to NSW schedules
- Statutory warranties: 6 years structural, 2 years other defects
- A licensed NSW builder number you can check in two minutes
Our contracts have no provisional sums: selections are locked before signing, so the price you sign is the price you pay.
That's only possible because we build five known designs with known bills of materials. Custom builders genuinely can't promise the same — repetition is what buys certainty.
Wondering what fits your block?
Obligation-free site assessment — the right home, the approval pathway and a fixed price, within 48 hours.
