Homebond cover with one-off house build

iplogger1

Can anyone tell me what the norm is with regards to building
contractors taking on (or shying away from) homebond cover
for a one off house ?

So far my understanding is that some builders will avoid providing
homebond cover for their works when it comes to once off
houses in the countryside whereas they might be fully registered
with homebond for larger housing developments,etc. I'm also
told that if the builder won't do homebond at the outset then
it falls on the employer/future householder/customer to arrange
a much closer level of supervision by their building engineers
(adding more cost to the project). I believe that certificates
of compliance, etc and various guarantees have to be furnished
during the build if this is the route taken.

What makes it awkward in the first place for the main contractor
to provide homebond cover for one off houses they build.
Do they need to pay a higher sub to HomeBond? Does it entail
a lot of extra hassle/paperwork on them. Is it a combination of
both ?

The situation I'm looking at is a very reputable builder but
just wondered if lack of homebond as part of the standard
building contract for a one off house was common or rare
in practice. Obviously I'm taking some legal advice on it just
to cover all eventualities.


~ipl

muffler

If the contractor registers your house under the Homebond scheme it will cost you a bit more as the cover is based on a percentage of the overall construction cost. Some contractors tend to shy away from this because of the extra paperwork involved.

No matter what route you choose you will have to get a cert. of compliance in any event and if you are tied to a mortgage then you will have to get someone to issue the stage payment certs. even if it is covered with Homebond

AdrianR

What you need is a bonded architect/engineer, it doesn't have to be homebond, as Muffler pointed out they will sign off the stage payments and are therefore guaranteeing that the work carried out is up to spec, and they will have suitable insurance to back it up. You would hire this engineer yourself if it's a self build, with a contractor I would assume the contractor would either hire a bonded architect or pay homebond to supply the service.

iplogger1

AdrianR wrote:

What you need is a bonded architect/engineer, it doesn't have to be homebond, as Muffler pointed out they will sign off the stage payments and are therefore guaranteeing that the work carried out is up to spec, and they will have suitable insurance to back it up. You would hire this engineer yourself if it's a self build, with a contractor I would assume the contractor would either hire a bonded architect or pay homebond to supply the service.

Thanks for the replies Muffler, Adrian

We already have a structural/civil engineer of very good repute
(I am almost certain he is bonded, etc). He provided the
house plans and one of his staff handled the planning
application and another did the pegging of the site to
mark out house/garage location.

The project is being carried out by a main contractor and not
direct labour. The builder isn't providing Homebond or Premier
cover. We always assumed our engineer would be doing
site visits,etc. I understand what is needed now is a higher
degree of supervision and signoff from the engineer than
I might have originally figured. I need to get a quote from
the engineer for this additional work. We had assumed
Homebond cover. I don't think the main contractor has
any intention of employing the engineer. We are the
employer of the engineer as we are the client and
house purchaser(s).

I spoke to legal folks and it seems this is pretty normal
stuff with one off houses. The mortgage isn't that large
so next I need to see whether Bank/lending institution
is happy with bonded engineer providing certs/signoffs
at each stage payment stage of build. I imagine it will
be fine.. my only unknown is how much this puts an
additional cost loading on the overall project.

I'll have a clearer idea when I manage to get hold of
the engineer on phone.

~ipl

muffler

Your engineer will have to give you written confirmation that he will be supervising the works together with his PI number. This goes to your solicitor who includes it with the mortgage docs.

Even if its only a small or partial mortgage make sure you have him there from start to finish.

And dont forget to submit the commencement notice