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Trust No One!

Hi there, this is Barry from UBuild Homes and in case you didnt catch the title I’ll say it again: Trust No One!

If you are planning on building a home then you need to take extreme care. As an Owner Builder you must take precautionary steps to manage your risks.

Learn About the Building IndustryMy intent is not to bag the construction industry, and as someone who has operated in the insdustry for over 40 years as a licensed builder, I think I can talk with experience. Putting trust in unprofessional people in the residential construction industry can hurt. In addition, these are difficult times which puts added pressure on the builders and trades who are out there quoting for work – many doing so without systems or proper training.

The problem is: it is so difficult to differentiate between professional and unprofessional conduct.

I’m not talking about dishonest people. There are plenty of those types in every industry and we all need to guard against the sharks out there. What I’m talking now is dealing with trades and builders who simply don’t use good, professional systems to quote, and who then create a disastrous outcome for you as a result.

Unfortunately, this happens too many times. The general public puts their faith in so called industry experts only to find their hard earned cash vanish into thin air. Please allow me to share a recent example:

A couple that came to UBuild Homes recently were very distraught. From the outset this couple had no intention of Owner Building. They had engaged a builder to do a quote for them to build their home. They accepted the quote. Unfortunately, the quote lacked detail and was poorly put together. The couple trusted the builder and thought he knew what he was doing. Just prior to signing the contract the couple made some changes to the plan. Nothing too dramatic – but then the builder used this opportunity as an excuse to lift the contract amount by as much as 100k. In other words he exposed his unprofessional conduct. It was very obvious the builder under quoted the job in the first place and so waited for the right opportunity to adjust the pricing in his favour!

Now, legally he is within his right to do this. But morally it is wrong. And unfortunately, happens all too often – and not just on large projects but small ones too. Owner Builders often recount similar stories of conflicts with a variety of trades because of the exact same process.

In the end the couple had to walk away from the builder. Due to the cost blow out and the resulting bad experience they then turned to Owner Building and today they are now UBuild Homes’ customers and moving forward.

The same couple also had a very poor outcome with their drafting service. Again the reason was trust. They simply assumed that the drafting service would be professional and knowledgable about the planning requirements. They were not, and this resulted in further costs and anguish.

Now let me say this: Neither the builder or the drafting service provider in question are bad people or what you would call ‘shonky’. They were just unprofessional due to a lack of skill, training and experience. This is what commonly happens in the building industry and it creates problems for customers.

It’s vital that if you are building a house through a builder, or are planning to owner build, you get educated. Don’t fall into the trap of trusting that others will always do the right thing. Learn to spot the difference between professional and unprofessional behaviour. Be vigilant, check everything, question everything. This knowledge and questioning might just be one of the biggest investments you will ever make!

Kit Home Companies Going Broke

Troubles with Kit Home CompaniesHow does a Kit Home Company go broke?

There has been cause for concern over the number of Kit Home companies that are in financial trouble and the number of customers and Owner Builders that have been adversely affected by this.

In particular, if you had a chance to read the recent article in the Bundaberg Newspaper about an Owner Builder losing money with a kit home company that went broke, and basically the Owner Builder having no protection under any warranty legislation. When you have a moment check out the article:

Kit Home Customers Fall Through Cracks

Here are some insights into the issue:

  • First of all the UBuild mantra for Owner Builders should be: Trust No One. The Building and Construction Industry is an extremely volatile and difficult industry and whether you are owner building or not, you should be extremely careful with every transaction. Ensure that you have good written contracts in place and that you manage your risks very carefully.
  • Kit Home Companies should not go broke! It’s that simple. Kit Home Companies go broke because their parent company or their manufacturing company goes broke. Any Kit Home Company that manages their own manufacturing or that is owned by a building company is a risk because they need to feed the beast, and so all revenue goes back into ensuring cash flow for the parent and partner company.

As a potential customer/Owner Builder you should be asking the following questions of a prospective Kit Home Supplier:

  1. Do you operate solely as a Kit Home Company or are you a building company with a division that is a Kit Home Supplier? 
  2. Do you own the suppliers you put the kits together from? ie The Frame and Truss Manufacturing (Steel or Timber), the Window Manufacturing Company, etc?

If the answer to these questions is “Yes” then you are at risk because these businesses require large amounts of cash flow to keep them going. Your kit home deposits go into that pool of cash flow.

A Kit Home Company should be cash flow positive. In other words they should be using their buying power to source the Kit Home Package for the client at the best possible price by ensuring that good suppliers are competing against each other for the business of that Kit Home Supplier. Kit Home Suppliers should then be flexible and customer driven in their ability to manage the needs of the customer in terms of product and finance.

UBuild cannot comment in detail about the Warranty Insurance issues raised in the Bundaberg Newspaper article, except to say that in every state the Home Warranty Insurance process is different – and that it is a mess. The fact that there is on ongoing Federal Government enquiry into Home Warranty Insurance is a testament to that fact. 

The bottom line is that customers should not lose money dealing with Kit Home Companies. These companies, if properly managed, should be service focused, flexible, wholesale building material supply companies. If they are involved in other businesses then you, as a potential customer, are at risk.

Please check out a recent article on the Owner Builder Advice site about a real customer who was rescued from a difficult situation because of the inherent flexibility in the UBuild Kit Homes process:

Close Shave for a Kit Home Customer

Good luck out there and keep us posted with any challenges or questions.

National Sustainable House Day 2009

Sustainable Housing DisplaysVisit a Sustainable House in your area. What a great idea if you are thinking of Owner Building!

Remember that Owner Building a Kit Home can and should be sustainable… you simply need some ideas and good advice.

On National Sustainable House Day, Sunday 13th September over 170 private sustainable homes around Australia will open their doors to the public. This is a fantastic opportunity to learn about sustainable living from homeowners who have been there, done that, and whose experiences are real. You can the bet there will be a few genuine Owner Builders amongst them. 

For the first time, homes will open for free this year thanks to the support of the Australian Government. It’s paving a way for people seeking to make their own homes or rental properties greener.

Home Sustainability Assessors funded through the Australian Government’s Green Loans program will also be available to discuss the range of energy efficiency actions that people can take around the home.

At UBuild Homes we are very focused on helping our Kit Home customers implement sustainable solutions when owner building their home. We can do this because Matthew Last, one of our Building Customer Managers is a Building Thermal Performance Assessor and a Home Sustainability Assessor. Matthew is also a Member of ABSA (Australian Association of Building Sustainability Assessors).

For home locations around Australia and for more detail on the features of individual homes visit Sustainable House Day.

Close Shave for a Kit Home Customer

Recently a Perth Owner Builder almost lost her deposit to a kit home company. This Owner Builder was just about to pay her deposit when by sheer luck she discovered that the kit home company was heading into liquidation… unfortunately, a common problem at present with the challenging economic climate.

Lucky Kit Home BuyerThis customer contacted UBuild Homes through the Internet and asked for some advice on how she might be able to move forward. She was a bit distraught about her dealings with the other company, but we were able to reassure her that all was not lost. UBuild showed her a process with a flexible approach, and now things are well and truly on track.

Some of the benefits that this customer received by working through UBuild Homes:

  1. As she already had her design we were able to take that design and put a kit package together to her desired specifications. Even better news – we were able to do this at a price better than the original kit home company had provided!
  2. The customer was provided with a fixed quote to supply her kit home to lock up stage. Fully detailed and specified.
  3. UBuild Homes were able to source all of the materials locally. As the customer was in Perth this made for very low freight costs. As UBuild Homes are not beholden to specific manufacturers we can shop around locally and use our national buying power to keep your costs down.
  4. We were able to organize the delivery of the kit home package of materials in stages to suit the customer’s building schedule.

Things are now going according to plan and the customer has gone from distraught to extremely happy. It’s all about figuring out what solution is the right one, and then with help from experts, putting that solution into place.

Something else you might find of interest is the subject of ‘sustainable kit homes’. It has been pointed out that many of the components to a UBuild Kit Home are “low embodied energy products” due to local sourcing of materials, minimizing freight distance and the types of product used, eg. plantation timber.

UBuild Homes is dedicated to managed sustainable construction and you’ll read a number of articles on this topic in the future.

So if you need help finding the right solution to your Kit Home challenge or want to investigate sustainable kit homes further, then give us a call or simply contact us.