Building A House ... The Contract...?

[walking wallet]

Can any forum members give me some advice , I am planning to have a house built, and have read the comments about having a " contract " drawn up with the builder. Can any one give me an idea just what to put in the " contract" and its layout, Any advice on getting the contract right would be appreciated .. Thanks

[Boo]

Sorry, no advise on your problem but I love your user name

[Sumitr Man]

WW:

First off, I think it makes a difference where you are building the house and whether or not you have an independent architect.

However, generally, building contracts in Thailand are done in "step" form.

Step 1 - downpayment

Step 2 - threshold 1

Step 3 - threshold 2

Step 4 - completion

Each step payment should be sufficient to make sure your contractor can reach the next step, without making them too lazy not to complete as quickly as possible.

Moreover, each step should have an inbuilt penalty clause, i.e. go from step 1 to step 2 in 30 days, failure of which will be a Bt. 500 per day fine.

Step 4, completion should have a bonus - reach this by contract signing day + x number of days and you get a bonus of Bt.500 per day. Conversely, it has a penalty if not reached.

In addition, each step should have a contract adjustment clause (just in case you decide to adjust your specifications).

Whatever you do, do not pay the full construction sum upfront, or else you run the risk of waiting 5 years for completion to ever occur; or, worse, you find yourself having to find a new contractor.

SM

Edited December 16, 2004 by Sumitr Man

[Crazy Dave]

The best bet is 100,000baht payments, the trouble is that a layman will see loads of work being done ie as walls are being put up etc which are quick and cheap, and then start complaining when they think nothing is happening when all the cable runs are being put in, or when expensive things are bought ie toilets and baths etc and then start complaining why the 100,000baht went so quick, thats when the contractor gets peeed off with the owner and the job starts going downhill.

As for getting a contract drawn up for a house build, i doubt whether it could ever be enforced and if it came down to them being in the fine period they will probably just walk away from the job, thailand is boom time now in construction and it would probably take less than a full day for any construction company to get a new house build job....

[RamdomChances]

I've always bought my own material's and paid the builders by the day, which is fine if you are there to keep an eye on them.

[Mariner]

For larger housing projects we use a FIDIC short form of contract pro-forma produced by the International Federation of Consulting Engineers but the basic principles are the same:

- The names and details of the Employer and the Contractor and their nominated representatives

- The name, location and description of the project

- The lump sum for the works including a detailed breakdown of the price and schedules of rates

- Lists of drawings, material specifications and scope of works including what materials/equipment you may be providing to them to fix

- The start date, any important milestone dates and the date for completion

- Details of any performance security (e.g. a bond in respect of a deposit payment)

- The warranty period for rectification of defects (e.g. 12 months)

- Details of the contractors insurances (i.e. Contractor's All Risks and Third Party Liability)

- Details of the payment method and schedule (e.g. milestones or monthly valuations of actual work completed) including the time for payment to be made (e.g. 14 days)

- How variations will be measured (e.g. using a schedule of rates)

- Signed by each party and witnessed

I hope this helps!

[think_too_mut]

For larger housing projects we use a FIDIC short form of contract pro-forma produced by the International Federation of Consulting Engineers but the basic principles are the same:

- The names and details of the Employer and the Contractor and their nominated representatives

- The name, location and description of the project

- The lump sum for the works including a detailed breakdown of the price and schedules of rates

- Lists of drawings, material specifications and scope of works including what materials/equipment you may be providing to them to fix

- The start date, any important milestone dates and the date for completion

- Details of any performance security (e.g. a bond in respect of a deposit payment)

- The warranty period for rectification of defects (e.g. 12 months)

-  Details of the contractors insurances (i.e. Contractor's All Risks and Third Party Liability)

- Details of the payment method and schedule (e.g. milestones or monthly valuations of actual work completed) including the time for payment to be made (e.g. 14 days)

- How variations will be measured (e.g. using a schedule of rates)

- Signed by each party and witnessed

I hope this helps!

<{POST_SNAPBACK}>

Not a palace but the house my wife built was finished within a week (well, they moved in within a week) and the builders were relatives and neighbours who all work (when they can find work) as contractors on building sites.

After that, tiles, fixtures, painting...were done one by one by those same people. The labor was the cheapest, some did it in return for past favors, some to earn future ones.

For houses under 500K I would not bother. For 1mil up, probably.

Edit: and on-site presence, of course. If you can't make it, your lady could be a good slave driver.

Edited December 17, 2004 by think_too_mut

[tuky]

Make sure you are on site as often as possible, ie everyday.

Even if all you do is sit down a read a book most of the time.

My friends built a house two doors down from us, and they were not in country for the whole build. They have spent a lot of money fixing the oversights, whereas we had someone at the house everyday, be it myself, my wife or my father in law. Our house was finished almost perfectly. BTW they were the same builder

Also the couple of bottles of lao kao each Saturday afternoon I bought for them helped immensely too!!!

[walking wallet]

Hi many thanks to all for the info,

I am planning to use my Wife's uncle who is a builder , and he seem's to have a decent track record, but having said that, I still want to have some sort of " Contract'' outlining just what's expected Etc.

I am planning to purchase all the materials my self and he will supply the labour and know how , No way do I plan to put any large amounts of money up front , and my budget is no more than 1,000.000 Bhat , for a 3 bed room bunglow , which will stand on 2 rai ( Chanott Tidin in the Khorat area ) ) which we already have .

I also plan to be on the site Every day , to keep an eye on what's going on , and stop any thing I don't like stright away.... not forgetting ( the couple of bottles of lao kao each Saturday afternoon and ice water for the workers each day. )

Talking it through with my wife , She seem's to think the Best way to lay out a contract would be have it show building stages. where by we would pay the builder a modest amount on the start of the work, then after say the foundations have been laid ( say stage 1) we would then pay some money ,and more after stage (2) has been compleated say the Roof is put on , Etc until the house is compleated, so the builder does a stage , then if we are happy with the stage result we pay , until the house is finished to our satisfaction

could forum members give me an idea of the order in which the building stages should be listed ....? EG...

Stage 1 . Foundation work

Stage 2. building shell / walls

Etc......

The other areas where I could do with some advice is

in which order do we have to start the " paper" work..? My wife seem's to think we will have to first go to the village Or Bor Tor ...? to get a building premit....? and with this paper, we can then go to the Amphur to get the House registration book and house number..? Next the water and Electricity supplys ...? I do have some building plans that I drew up, and I will have to look for some one to do a set of correct plans .

can any one who has gone through the above processes please give me some advice,and comments which will help

Thanks .....

[Jockstar]

Can any forum members give me some advice , I am planning to have a house built, and have read the comments about having a " contract " drawn up with the builder. Can any one give me an idea just what to put in the " contract" and its layout, Any advice on getting the contract right would be appreciated .. Thanks

Sorry, no advise on your problem but I love your user name

Is that what your tgf and her family call you?

[Crazy Dave]

first u need plans for your local city hall, get them to draw them up and you can start building straight away.

next you need electric and water, so build a concrete shed or pool room if you are having a swimming pool and set up your main electric box in there, now you have electric, the water is no problem, now you can actually start building.

to actually schedule the building and payments is not really worth it on such a small job, its 10 guys for 3 months to do it out pretty good, or 1 month for thai style finish

[walking wallet]

Thanks Dave,

You say...first u need plans for your local city hall, get them to draw them up and you can start building straight away.

Do you know where I would need to go if building in the Khroat area...?

Thanks..... WW

[Crazy Dave]

Korat I have no idea, but that is the best way to do it by getting the city hall architects to draw up the plans, ok it may cost double but you can start straight away and they dont keep hassleing you or making you wait months for a decision.

heres a nice pic of a guest house we are building, yep the guest house cost more than the house you want to build, but it is double glazed, has foam insulation all round it, a 100,000baht jacuzzi, and its all granite and marble, to the left is the maids room, and underneath the guest house is a garage.

[harald finehair]

Hi Walking Wallet,

We are planning to build in the Khroat area, and would also be intrested to know about the Paper work Etc along with a contract for stage payments .. I hope some one can give us some Ideas

Harald .....