Paul Corn is a building inspector but he's not just any building inspector. His company – Handovers.com – will come in and make sure that everything is okay prior to you taking over a property that you’ve just had built. This can be a bit of a minefield, having spoken to many people who have had some real big problems with builders and new buildings and what happens when they eventually move in.
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Kevin: Paul Corn from Handovers.com joins me. Handovers, of course, is a company that will come in and make sure that everything is okay prior to you taking over a property that you’ve just had built. This can be a bit of a minefield, having spoken over the years to a number of people who have had some real big problems with builders and new buildings and what happens when they eventually move in.
Paul, from your experience, what do you see are some of the major frustrations people have when they’re dealing with a builder and they’re going to take over a brand new home?
Paul: Kevin, one of the main things we see is lack of communication from the builder. They get caught in limbo, they don’t know what’s going on, they ask questions. That is the number one that we see.
Kevin: I want to talk to you about how you actually know that you’re getting a good builder, and I guess good builders aren’t necessarily good communicators, which is really what you’re saying. Lack of communication. What are some of the other frustrations?
Paul: A lot of clients want to go to the site and have a look at their house, and the builder sometimes doesn’t let them do that. But as per their contract, they are entitled to do that.
Kevin: This wanting to go and have a look at the property, even though you have a builder who you’ve engaged and they’re building it for you, it doesn’t become yours until you make that final payment.
Paul: That’s correct. You have to get permission to enter the job site at any time, and it is in normal business hours.
Kevin: Is that just a safety rule?
Paul: Safety is the main one but also disrupting trades while they’re working, that sort of thing.
Kevin: Does the same apply with renovations?
Paul: It depends on if you’re still living in the house. Normally, that area should be locked off. Yes, it’s all to do with workplace health and safety.
Kevin: As well as safety, I imagine there are other risks as well, like materials being taken. I imagine this would happen quite often on building sites as well, materials and tools that just go missing. I’d imagine builders would be pretty concerned about that.
Paul: Yes, theft is a big thing. A lot of people treat building sites like a Bunnings Hardware: they just take what they want.
Kevin: Without the checkout.
Paul: Yes, that’s it.
Kevin: That’s terrible.
How do you know that you’re getting a good builder, Paul?
Paul: Research. You have to do your research. I always recommend that if you see a house being built by the builder you want to go with, and if you can go and knock on their door and ask what their experience is like, you can’t beat research. It is the main way to find out how a builder is.
Kevin: Research, and also talking to people who have had that builder, do you think?
Paul: Yes, word of mouth. The best advertising for anybody in our business is word of mouth. But saying that, Kevin, the supervisor is the person who builds your house. If the builder has a good supervisor, then you’ll get a good house.
Kevin: Yes, that’s a really good point. The name out the front doesn’t matter.
Tell me about supervisors. What is their role?
Paul: Exactly what they’re called, supervising. They need to supervise, they need to forward plan, they need to control the job. Their job is to control the quality of that house. We see some shockers, but the worst part is we meet supervisors who haven’t come through the industry. I met a guy the other day and asked him his background. His background was banking. Now, no disrespect…
Kevin: Nothing wrong with that, but how long had he been in the building trade?
Paul: Three months.
Kevin: Wouldn’t it be better to get supervisors who have practical, on-the-ground experience? You as an example, you have good background, you have good experience of the building trade.
Kevin: If it’s that important, why aren’t they the highest skilled person on the building site?
Paul: Honestly, I don’t know. I’ve met a tiler who was a supervisor. Once again, no disrespect to tilers, but he wouldn’t know anything about the framework of that house.
Kevin: That’s right. The thing that scares me is that when you get to a building, there’s lots of stuff you can’t see behind. We had an experience recently with someone who was on the show. He’d had some frustrations with the building company. He and his son had a lot of complications, and a lot of the stuff was actually hidden where you couldn’t see. That scares the hell out of me.
Paul: When we do our inspection, we’re looking at the finished product, so everything once again is hidden. But you hope that the builder’s certifier or the engineer who certifies the slab, the frame, the roof trusses, all that is doing the right thing by the industry.
Kevin: In the event that you have a successful claim against a builder, how much liability does the inspector carry? Is he liable? Does he have to have any professional insurance to cover it?
Paul: No, that’s under the builder’s umbrella. He’s working for that builder, so the builder is responsible. They’re the ones who carry the can.
Kevin: What’s the difference between them and a certifier?
Paul: The certifier is more highly trained. He probably does a university degree to become a certifier.
Kevin: Who does he work for?
Paul: The certifier is independent. He works independently. He’s probably engaged by that builder to say, “Yes, it’s okay to pour the concrete,” or “It’s okay to sheet the walls.”
Kevin: Is the inspector on site the whole time?
Paul: The supervisor?
Kevin: The supervisor, sorry.
Paul: In today’s world, no, because he might have anything from 20 to 60 jobs. Now, any building company that gives a supervisor 60 jobs is nuts because they can’t do it.
Kevin: So, you have the supervisor, but then you have got the certifier. At what point does the certifier come in?
Paul: We’ve got the slab, the framer puts the frame up, puts the roof on, then they come in and have a look at the frame, and it has to be certified. You have to get the okay to sheet that house with the gyprock, and that keeps the process going. You can’t go any further until the frame has been given the tick of approval by the certifier.
Kevin: So, all the way along the line the builder is the one who carries the can. He’s responsible. If anything goes wrong, they would sue him not the…?
Paul: Well, they’d probably work their way backwards. You would start with the builder and then to the certifier.
Kevin: So you could actually sue the certifier.
Paul: If they put something through that’s not right, I’m sure they’re in the firing line.
Kevin: Do they have insurance to cover them for that?
Paul: Yes, they would have to have that.
Kevin: Okay. I’m just trying to track through the areas of responsibility here, because if you have a problem with a property and you have your builder, that’s a minefield of people who are involved in it.
At what point does someone engage with you and your business? Are you willing to get involved and oversee a lot of the project?
Paul: We are licensed builders. My company is licensed, but we can’t give any certification information.
Kevin: No, but you could give some advice.
Paul: We can give advice. We can ask questions. If we see, let’s say, a bracing ply that’s not correctly nailed, I can ask the question “Is this bracing ply nailed as per the code?” But I can’t put in writing that it’s not nailed as per code.
Kevin: But you’d see it and know that it’s there.
Paul: Yes, we see it.
Kevin: If I were building a property, I’d want to get someone like you to help me with that process, because I know that we have certifiers and all those, but I’ve seen a lot of this come unstuck too.
Paul: Yes. The building bush telegraph is very good and you hear all the rumors of what’s going on. But yes, the certifier is responsible, and if he gets it wrong, then it’s his responsibility.
Kevin: Okay. We’re going to take a break. My guest is Paul Corn from Handovers.com. You can go and check out that website if you’d like to know more about how they work.
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Originally published as: https://realestatetalk.com.au/protection-for-new-home-buyers-paul-corn/
Kevin Tuner worked in radio as General Manager of various east coast radio stations. He started in real estate in 1988 and was ranked in the Top 10 Salespeople in the state until he was appointed as State CEO 1992.
He operated a number of real estate offices as business owner and was General Manager of several real estate offices in Christchurch.
He now hosts a real estate show on Radio 4BC and a weekly podcast at www.realestatetalk.com.au. He is the host of a daily 7 to 10 minute podcast show for real estate professionals at www.reuncut.com.au.
To hear more podcasts by Kevin Turner, click here
Disclaimer: while due care is taken, the viewpoints expressed by contributors do not necessarily reflect the opinions of Your Investment Property.