1. Establish budget:
Before beginning a new home construction project, the homeowner must establish a clear budget and expectations for the cost of the build. This should include all materials, labor, permits, inspections, and any additional services that may be needed. It is important to have an accurate estimate up front for how much money will be spent on the project in order to avoid unexpected overspending.
2. Scope of work:
The scope of work should be clearly outlined in the contract and include all details necessary for a successful build, such as materials needed, timelines, expectations for subcontractors, etc. It is important to specify who will be responsible for various tasks throughout the building process.
3. Describe payment terms:
The payment terms should be outlined in the contract so that everyone involved understands how payments will be made (e.g., upfront deposits or periodic installments). This should also include any penalties that may apply if deadlines are not met or if changes are requested by either party during the building process.
4. Include permits & inspections:
It is important to include permits and inspections in the contract so that all parties are aware of which permits need to be applied for, when they must be submitted, and what kinds of inspections will be required throughout the build.
5. Document liabilities/insurance coverage:
The contract should specify who is liable for any issues that arise during the building process and any insurance coverage that may apply. This should also include a clause detailing an acceptable course of action if there are disputes between the homeowner and contractor(s).
6. Specify deadlines & penalties for missed deadlines:
The contract must clearly outline necessary deadlines for each step of the build, as well as consequences for missing those deadlines or otherwise not meeting expectations. This helps to ensure that the build is completed in a timely and efficient manner.
7. Detail materials to be used and/or provided by contractor:
The contract should clearly outline any materials that will be necessary for the build, as well as who will provide them (e.g., the homeowner or contractor). This helps avoid confusion regarding what supplies are needed for the project and who is responsible for purchasing them.
8. List subcontractors, if applicable:
If subcontractors are involved in the building process, they must be listed in the contract along with their roles & responsibilities on the project. The terms of payment and deadlines should also be included for each subcontractor’s work.
9. Outline warranties & guarantees:
It is important to clearly state any warranties or guarantees that are included in the contract so that both parties understand what is expected of them and how they will be held accountable if something goes wrong.
10. Establish procedures for change orders:
Changes may need to be made during the course of the build, so it is important to have a clear process outlined in the contract for how those changes should be communicated and implemented. This should also include information about who has the power to approve change orders and when those decisions must be made.
11. Assign responsibility for cleaning up the building site:
The contract should specify who is responsible for cleaning up the building site after the project is completed. This helps ensure that the site is left in a condition that is satisfactory to all parties involved.
12. Include a dispute resolution clause:
In the event of a dispute between the homeowner and contractor(s), it is important to have a clause in the contract that outlines how those disputes will be resolved. This helps ensure that all parties are on the same page about how issues should be handled and helps avoid unnecessary delays in getting the build completed.
13. Note any other required documents or certificates (e.g., occupancy permit)
Any other documents or certificates that may be required for the build should also be noted in the contract, such as an occupancy permit or energy compliance certificate. This helps ensure that all necessary paperwork is accounted for and that the project can move forward without any delays.
14. Describe termination clause in detail
The contract must include a termination clause that outlines what will happen if either party chooses to terminate the agreement. This should include information about how much notice is required and any penalties that may apply.
15. Specify any additional services to be provided
The contract should also include any additional services that may be provided by the contractor, such as inspections or repairs. This helps ensure that all expectations are clear and that both parties know what is expected of them.
16. Signatures of all parties involved in the contract
Finally, the contract should include the signatures of all parties involved in order to make it legally binding. This helps ensure that all parties are in agreement and understand their respective rights & responsibilities under the contract.