Variations, and how to keep them few
A variation is any change to the work after the contract is signed. They are normal. A long list of them is not, and most of it can be prevented before construction starts.
What a variation is
The contract describes a scope of work at a price. A variation is a change to that scope — something added, removed or done differently — along with what it does to the price and, sometimes, the time. In NSW residential building, variations are required to be in writing, and they should be agreed before the work is done, not afterwards.
Where they come from
- Your decisions. A different tile, an extra power point, moving a window. These are yours to make, and a good builder will price them and tell you what they do to the programme before you commit.
- Incomplete documents. If the drawings and specification do not say what something is, someone has to decide later, and later is when it costs more. This is the single biggest source of variations, and it is the most preventable.
- What nobody could see. Rock in the excavation, an old service in the wrong place, rot behind a wall in a renovation. These are genuinely unknown until they are found. The contract should say how they are handled.
Keeping the list short
Most of the work is done before the contract is signed:
- Make the selections early: tiles, tapware, appliances, joinery, lighting. A finished schedule of selections is worth more than any clause.
- Read the specification as carefully as the drawings. Ask what ‘to be confirmed’ or ‘allowance’ means against each line.
- Understand the provisional sums and prime cost items, which are allowances rather than prices. Our article on what a fixed price actually fixes covers both.
- Spend on investigation where the risk is underground. A geotechnical report and a survey that locates services are cheaper than the surprises they prevent.
When a change is needed
Ask for it in writing, with the price and any effect on time, before the work goes ahead. Keep every variation together and number them. Read each one before you sign it, and ask about anything you do not follow — including whether it affects work that comes later.
A change requested in a hurry on site is the one most likely to cause a dispute. If it can wait a day to be written down properly, let it.
What good looks like
A short variations list, every item signed before it was built, and no surprises in the final account. That outcome is achievable on most new builds and many renovations, and it depends at least as much on the documents and decisions at the start as on anything that happens on site.
Nothing here is legal advice. NSW Fair Trading publishes guidance on home building contracts and variations, and it is worth reading before you sign.