Master Builders NSW says materials costs are rising at their fastest rate in 42 years, and that companies should ask clients for more money.
Home builders should renegotiate fixed-price contract terms with customers as they grapple with building material costs rising at the fastest pace in 42 years, the industry lobby group in NSW is telling its members.
However, Master Builders NSW says members are obliged to meet legally binding contracts and their ability to adjust terms comes down to getting clients to agree to pay more. Clouds loom: Home builders, faced with sharply rising costs, are being encouraged to renegotiate fixed-contract terms with customers.“The process of requesting a renegotiation is absolutely gaining momentum,” Master Builders NSW executive director Brian Seidler said on Sunday.Mr Seidler said it was not in the client’s interest for their builder to go to the wall over a fixed-price contract that bound them to unforseeable cost increases.
Approvals of new detached houses rose to a record 155,057 in the 12 months to September last year, spurred by the federal government’sscheme and state government incentive payments aimed at stimulating the economy as the pandemic took hold. The consequent leap in home-building coincided with a global surge in demand for materials as economies kicked back into action amid widespread vaccination which reduced the threat of COVID-19.
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