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Tag Archive for: builder insurance NSW

How to Choose the ‘Right’ Builder for Your Project - Magico ConstructionsMagico Constructions

How to Choose the ‘Right’ Builder for Your Project

in Articles

Selecting the right Builder is crucial to the success of your building project.

Without the right Builder, projects risk running over budget, being delayed and worse of all, being ridden with defects.

Below are some of the things you should consider when considering a Builder.

  • What is the company’s and staff’s background history?
    • Is it a relatively new building company? If so, then it is worth considering what experience the Builder may have prior to starting the company. The benefit of choosing an experienced and well-educated Builder is that they will have foresight to identify potential problems with your projects which will help eliminate costly variations and time delays.
  • Client testimonials can be misleading.
    • When reading past client testimonials, be wary of the authenticity and make sure to cross-check things. For example, you may cross check a testimonial to the project and ask to visit that project/site so that you can meet whoever left the testimonial. Not all client testimonials may be an accurate assessment of the Builder. (Similar to how online reviews may not always tell the real story)
  • NEVER choose the Builder who provides you with the lowest quote.
    • Generally speaking, you should NEVER choose the Builder who provides you with the lowest quote. The famous saying of ‘you get what you pay for’ is especially true when it comes to construction.
  • Ask to visit their current job site.
    • We are firm believers that you are only as good as your last project. Which is why we often encourage our potential clients to visit our most current job sites. It is not surprising that everyone has had at least one ‘outstanding’ project in their resume, but what distinguishes a great Builder from the norm is the ability to consistently deliver good-quality construction projects.
  • How systemised and organised is the Builder?
    • Ask how the Builder manage their projects and what systems and processes they have in place to ensure quality control. A well organised Builder will be using some sort of cloud-based project management tool and should have processes and standards in place. (Which could be in the form of having ISO-certification for Quality Control, Work Health & Safety and Environmental Management System)
  • Professionalism
    • Whilst many Builders claim to be a ‘professional’, few manage to really uphold this sense of professionalism. A true professional should be capable of arriving to meetings on time and conduct themselves in a professional manner in all forms of communication. This means no casual smiley-face emojis, no shorten forms of ‘thanx’ or ‘cu’, no penny-pinching in cutting costs to do with having a company website or proper email address.
  • Check that validity of their licenses and insurance
    • If your residential building project involves less than 4 storeys, it is imperative that your Builder is capable and eligible for HBCF (Home Building Compensation Fund). Did you know that you can conduct a search regarding the validity of the Builder License and whether there are any pending court cases online?
      Visit: https://www.onegov.nsw.gov.au/publicregister/#/publicregister/search/Trades
  • Does the Builder ‘care’ about your project?
    • Chances are if you’re speaking to a large volume-based builder, your project will be treated as just another drop in the bucket to them. If the Builder truly cares about your project, they should be pro-active about scheduling site inspections, meetings with you to understand the goals of the project and display enthusiasm and interest.
  • Has the Builder done their ‘homework’ and do they ‘understand’ the project?
    • The easiest way to distinguish this is to see whether the Builder has mentioned any site-specific risks or restrictions for the project. Another way is to gauge this is to see whether the Builder was able to reflect your desired goals and expectations for the project.

The reality is that selecting the ‘right’ Builder for your project is a complex process which involves weighing multiple factors across the board before making the final decision.

If you are someone with limited/no previous construction knowledge, it is probably in your best interest to seek assistance from an experienced professional (such as an architect or project manager) during the project’s tender review stage.

Although this will mean investing a bit of money up front, we strongly believe that it is well worth the investment as it could easily save you thousands of dollars in variations later down the track.

If you have an upcoming project which you would like us to help with, simply fill in our contact form HERE.

Prefer to speak with us directly? Book a free call with our team today and get expert guidance tailored to your needs.

https://magicoconstructions.com/wp-content/uploads/2025/04/choose-1.jpg 600 900 Magico Constructions https://magicoconstructions.com/wp-content/uploads/2026/03/magico-constructions-logo-new.png Magico Constructions2025-04-04 05:12:032025-12-12 06:29:18How to Choose the ‘Right’ Builder for Your Project
Challenges of the NSW HBC Scheme - Magico ConstructionsMagico Constructions

Challenges of the NSW HBC Scheme

in Articles

For those who are working in the NSW construction space, please consider voicing your opinions and concerns on the Home Building Compensation (HBC) Scheme.

Those who know me understand that I have always advocated for an overhaul of the HBCF.

Link to Home Building Compensation Fund Review

For most multi-million-dollar projects, the HBCF cover of ‘just’ $340,000 offers very little in the grand scheme of things.

Not only that, given that the HBCF policy only covers extreme situations — such as a major defect, the builder going insolvent, or being unable to complete the work — the costs of HBCF can often be an unnecessary expense for the owner.

The current HBCF overhaul under consideration proposes increasing the coverage from $340,000 to either $440,000 or $540,000.

While I do support the idea of increasing the cover amount, I am not in favour of raising the average insurance cost by $4,790 to $5,130 for new home builds, or by $1,450 to $1,550 for renovations and alterations.

One thing many may not be aware of is how incredibly difficult it is for builders to increase their HBCF insurance cover.

For a new building company, it’s often almost impossible to grow the business, even if you want to, as increasing your HBCF cover typically requires capital injections — making it financially impossible for most.

The other gripe I’ve always had with HBCF is the fact that it fails to consider that most multi-million dollar projects often having a building cycle that is longer than 12-months.

Meaning that the majority of your HBCF insurance coverage can be held hostage by projects that run over a 12-month cycle or are running late.

This effectively prevents the builder from being able to pick up new projects, which results in the cashflow purgatory that many face which leads to insolvencies.

In fact, the current ASIC data shows that ‘there were 1372 construction companies which entered into external administration for the first time in 2023-24 compared to 981 in 2022-23, and 513 in 2021-22. Construction industry insolvencies in NSW increased by 40% in 2023-24.’

However, what that data doesn’t capture is the building businesses that are sole traders or partnerships that have also gone into administration or insolvent.

Now, more than ever it is important to choose your builder wisely.

For builders, it is even more important to choose your clients wisely.

Having recently gone through unprecedented events involving difficult owners myself, I must confess that I’ve learned a lot about the legal shortcomings of industry-standard contracts.

Did you know that as a builder, if you encounter a difficult owner who refuses to pay, there’s little recourse but to take them to either adjudication or NCAT?

While you could always contractually ‘suspend’ work on-site, there are no means of recovering lost costs except through legal battles, which can drag on for months or even years.

These are the issues not many people are talking about.

Unfortunately, only those who have experienced this first-hand can truly relate and often only discover these challenges when it’s ‘too late’ in most cases.

What’s worse is that some owners deliberately wait until the project is nearing completion to instigate these non-payment issues, knowing it would often cost the builder more in legal fees than simply walking away and cutting their losses.

In an ideal world, there would be greater transparency, not just for builders with checkered pasts, but also for owners who are repeat offenders, deliberately refusing payment to hard-working builders and subcontractors.

With the forecast for the residential construction sector looking grim, it’s no wonder that many builders have decided to call it quits.

It’s simply becoming too hard, and good people are being taken advantage of.

Here’s hoping that the HBC review will bring about positive changes to support the building industry.

In an ideal world, this review would not only result in greater coverage for homeowners but also consider extending the insurance coverage period to accommodate longer projects. This would enable builders to grow their businesses organically with a roll-over insurance cover.

Book a free call with our team today and get expert guidance from a licensed and qualified builder.

https://magicoconstructions.com/wp-content/uploads/2025/04/Challenges-of-the-NSW-HBC_Scheme04.jpg 600 800 Darren Zhou https://magicoconstructions.com/wp-content/uploads/2026/03/magico-constructions-logo-new.png Darren Zhou2025-04-04 00:07:402025-11-18 21:48:34Challenges of the NSW HBC Scheme
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