We’ve put together a step-by-step process for selecting a tradesperson or builder.
What does a builder do?
Many builders today do not do actual building work themselves. Builders or building contractors:
- manage and coordinate home building or renovation projects
- manage the purchase and delivery of materials
- coordinate the work of tradespeople such as plumbers, painters and carpenters involved in the project.
What does a tradesperson do?
A tradesperson has a current licence from NSW Fair Trading to carry out work in a particular field in the home building industry in NSW.
The term tradesperson includes all licensed:
- roof tilers
How to find a builder or tradesperson
Try the following first:
- ask people for their personal recommendations
- ask other people in the industry
- ask the relevant industry association for a list of names
- look for advertisements on television, radio, in home buyer magazines or the local newspaper
- search the Yellow Pages or other relevant online directories for 'building contractors', 'home improvements' or specific trade categories.
If you choose one of the designs of a builder on display at an exhibition home, then you will probably use that builder. If not make sure you sign a contract that sets out exactly what they are building.
The right tradesperson holds the right licence
You should always check your tradesperson holds the right licence for the job.
NSW Fair Trading research into licensing reveals that some consumers are at risk because they do not actively check that a tradesperson is licensed before they hire. The research shows that 80 percent of homeowners think licensing is important, but only one in 10 go to the Fair Trading’s website to check if a tradesperson is licensed or not.
Go to our home building licence check page or call 13 32 20 to do a free licence check.
Questions to ask a building contractor you want to use
What is your contractor licence number?
You should only deal with a contractor who is currently licensed by NSW Fair Trading:
- go to our Home building online licence check and look up the contractors details yourself; or
- call NSW Fair Trading on 13 32 20 and one of our customer service officers will search the public register for you.
Where can I see examples of your work?
Ask the contractor for the addresses of previous houses they have renovated or built and ask the owners if they were satisfied with the results.
Some questions you can ask:
- Was the project finished on time?
- Did they stay close to the quoted costs?
- Was there proper supervision of the other tradespeople?
- Did any defective work get fixed promptly?
- Would they recommend the contractor?
- And importantly, was there good communication with the contractor?
What other jobs have you got on at the moment?
A contractor with a lot of work on may not be able to properly manage your job as well.
Who will supervise the work?
A contractor doing a large job may get a supervisor to manage the project.
Make sure the supervisor has:
- sufficient experience in the type of work you want done and
- a current Supervisor Certificate from NSW Fair Trading or
- their contractor's licence is appropriately endorsed.
Do you have proper insurance?
It is important to check the contractor has all the necessary insurance cover to protect you and your home if something goes wrong. Go to the insurance page for an explanation of the different issues and types of insurance that may be required:
- Home Building Compensation Fund Insurance
- Builders All-Risk Insurance
- Public Liability Insurance
- Workers Compensation or Insurance
- Kit homes and Insurance
- Contracts Insurance
How much deposit do you need?
Under NSW home building law, the maximum deposit you can be asked to pay is 10%.
If the work is required to be covered by insurance under the Home Building Compensation Fund, it is illegal for the contractor to ask for a deposit or other payment under the contract unless the insurance has been taken out, and a certificate of cover is given to you.
Important. It is highly recommended that you check the validity of a HBC certificate given to you by accessing an online tool called HBC Check.
When can you start the work and how long will it take?
If you want the work done by a specific date, make sure the time frame provided in the contract:
- is realistic
- takes into account possible delays through bad weather or the late supply of materials
- has a start date and completion date.
Make sure you and the contractor are clear on what they consider 'complete'.
What sort of contract will be used?
If the cost of labour and materials is more than $5,000, the law requires a written contract to be used.
Contracts are not only legal requirements, they will protect you if anything goes wrong.
Fair Trading contracts
Once you’ve decided on a tradesperson or builder, the next step is to sign a contract. Fair Trading has produced a series of plain English contracts covering all types of building and renovating work. You can download these for free from the contracts page.
How much will it cost?
- the contractor includes the total cost of the work in the contract
- estimated costs are clearly stated in the contract and are realistic
- you understand how and why costs may change and how the total cost can be affected (eg. some builders will specify the site cost in the contract as a ‘provisionary cost item’. This means that this cost may change depending on what the builder’s actual costs are in preparing the site. If the site is difficult to build on, or the builders hit solid rock, it will cost you more).
When are progress payments to be made?
Most building contracts have a fixed price for payments to be made for work done, not time on the job. Progress payments should be equal to the dollar value of work completed.
If you've borrowed to build or renovate, your bank or mortgage provider may want to inspect the work before each payment is made. You may want to have an architect or building consultant inspect the work at each stage to ensure it is being done properly and to contract specifications and drawings.
What happens if the work is defective?
This question will help you get a sense of how the builder is likely to deal with any complaints you may have about the work. You should know in advance what your options are if a dispute arises.
Who cleans the site?
Get this clear from the start so when work is completed, you are not left with a big mess, or a dangerous building site. Make sure an agreement about cleaning the site regularly is included in the contract.