What to look for in home-building contracts


When it comes to home projects, both the owners and builders draw some benefits. The owner wants his dream house and the builder wants the money for making that dream come true. This is the simplest way to look at the situation because the whole process involves many details and specifications. The building contract is very important because it has the goal to prevent any disagreements during the process and provide a guide for potential issues. The contract must be well written, complete and easy to understand. As a member of Federation of Master Builder, he will surely provide a contract, which you should read carefully before you sign. Moreover, you have the right to negotiate or add certain terms if you want. The best thing is to establish all the details from the very beginning so you avoid unpleasant situations in the near future.

Statement of work

The statement of work represents an important part of the contract that must be well written and complete because it practically includes all the details of the builder’s work, such as obtaining the necessary permits and providing the necessary services to complete the home project as well as materials and equipment. A comprehensive plan of the house should be attached to the contract and the builder must take into consideration the specifications in order to complete the job successfully. It is important to double check this section for conflicting terms or anything else that might lead to confusion or discords.

Completion date

If you want to avoid any delays concerning the completion date, you have to make sure that the beginning of the construction, the builder’s work schedule and the ending of the construction are stipulated in the contract. Of course, exceptional situations like unfavorable weather conditions, inspection or payment delays, changes and other issues will extend the period. If the builder does not want to observe a strict program, you can include a clause that states the throwing-back of the project caused by the builder, which means that he will have to pay you for every day over the schedule.


This section should obviously include details regarding the money you have to give the builder for his work including the amount and the method. If you want the works to run smoothly, you have to make sure that you have enough money to fund the construction and to provide an initial payment. During the home project, the builder has the right to demand certain amounts of money according to the amount of work completed.


The purpose of this section in a contract is simple and is beneficial for the house owner because it forces the builder to fix any defects that appear after the completion date. It must contain information concerning the term of the warranty, the types of defects the builder must take care of and the owner’s maintenance obligations. Do not hold back from negotiating the terms if you feel necessary. In addition, if you do not see a warranty section in the contract, you can add one.