Fixed Price Building Contracts

Fixed price building contracts, otherwise known as "lump sum building contracts" can be a useful tool if you are worried about the budget escalating or running out of funds.

 

Technically, the price isn't entirely fixed as there will be some prices that are out side of the control of the builder. Foundations for example can differ to the specification as the local building control officer can make extra demands.

 

Its all quite common that as the build progresses variation items tend to get added when the client makes changes or adds on extra work.

 

Generally speaking, a fixed price contract is a pretty good way to start a build. Just bear in mind that there will be a few elements where Provisional Sums will be used until the true cost is determined.

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