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Builder miscalcated and now wants to add $5000

21,496 Views | 85 Replies | Last: 4 yr ago by dubi
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AggieDruggist89
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CastleRock said:

Why are you buying a house that you think is ugly?


Long story short it has a killer view sits up high overlooking a beautiful river and a bluff and Pete Dye Golf Course. Not on the course but sits above it.

If I do stay and retire here, I will do a pretty major renovation to install large windows. I am going to build the largest deck in the neighborhood. That's given. The basement will have my golf simulator and indoor putting green in addition to 3 bedrooms.

If I don't stay, then I can always sell the house due to the favorable location.
Deats99
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Stick to your guns. If this is a true "package deal" and you are using all "their" people, $5K on a $410K deall is chump change on their bottom line. That is in their shinkage. Politely tell them to EAD.
A good plan violently executed now is better than a perfect plan executed next week.
-George S Patton
Missouri Boat Ride
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throw him a loaf of bread and tell him to make him some damned stone sammiches, because he's getting ready to eat it.

If you have a clearly defined scope (an objective, quantitative description, drawings, etc.) for a clearly defined price that is signed, it's pretty straight forward. If no, it can get rather ambiguous.

If this is a volume builder, this isn't the first home they built, nor will it be their last. The tonnage of stone should be known in advance when identifying building cost to build. I would not be surprised if somewhere along the line between the PM, foreman, and procurement folks someone entered made an error on their internal buy sheet or the price of stone increased and the unit wont make specified margin.
AG Custom
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Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.
CaptnCarl
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AG Custom - this is why I think splitting is often the best solution. It helps cover honest mistakes, but doesn't let them become a habit.
Build It
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Well said.
AggieDruggist89
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AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.


Give me a break with that clich there are 2 sides to the story. Both side of the story have been posted, mine and theirs. And you can clearly see they claim to have made an error yet the contract is binding. This is not a small mom and pop builder as they are building over 300 houses in this area, all prefabbed crap. I will have to do a major renovation once we close.

They've made other errors before where they pulled the permit before we settled on the options. So they had to repull the permit and tried to charge me another $1,100 which I ignored. They paid it.

They have the right to bill me? I think not.
Diggity
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Why ask for people's opinions if you don't want to hear them?
ABATTBQ11
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HouAggie said:

Sounds like an honest mistake. I'd either reconfigure the design or pay the extra $4,600.


I think we found the builder...
AggieDruggist89
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Diggity said:

Why ask for people's opinions if you don't want to hear them?


You're right. I shouldn't lash out at a response.
FlowCtlr
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Very eager to hear the response to your email, OP. I was in a similar situation, and it didn't take much for the builder to realize he needed to absorb the cost. He was cool about it though.
AggieDruggist89
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Building supervisor emailed to schedule a walk through before the drywall install that will begin in September. I'm meeting him this Friday. No mention of the $4,800.
Build It
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Sounds like you need to bail on this deal. A house you don't like and a builder you neither trust nor appreciate.

Get out while you can.

Bob_Ag
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AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.
Yes it is. You think that builder is paying that much or that is their direct cost for the stone? Every line item option for the buyer has a profit margin for the builder. If it costs five grand for one wall of stone imagine how much it costs on houses that have full front stone or 3-4 side masonry. We'd be over $50K at that point, but we all know its no where near that.

This isn't a custom home. It's a production builder and they are trying pass their mistake on to the customer. Like I said, splitting the cost is reasonable, but the builder is the one that should have offered that deal.
ABATTBQ11
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AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.


Absolutely not. If the change has been incorporated into the contract via change order, which it sounds like it has, the builder is basically screwed (legally). They contractually agreed to that work for that price, so they're stuck with it. Otherwise, contractual obligations mean nothing.
AggieDruggist89
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Build It said:

Sounds like you need to bail on this deal. A house you don't like and a builder you neither trust nor appreciate.

Get out while you can.




Well I have 5% deposit down. Would hate to lose it.
94chem
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AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.


The law is on your side in virtually everything you do. The contract law favors you, the taxing entities favor you, and the state attorney general is in your hip pocket. Cry me a river. Oh wait, too late.
Furlock Bones
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AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.
bwahaha. this whole response is a joke, right? contracts matter on both sides. if builders can write them to favor themselves in 95% of situations with almost zero outage language for buyer, then they need to live by them when they screw up. which it seems like the builder did just that.

contracts matter.
Cuterebra
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nm
94chem
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AggieDruggist89 said:

AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.


Give me a break with that clich there are 2 sides to the story. Both side of the story have been posted, mine and theirs. And you can clearly see they claim to have made an error yet the contract is binding. This is not a small mom and pop builder as they are building over 300 houses in this area, all prefabbed crap. I will have to do a major renovation once we close.

They've made other errors before where they pulled the permit before we settled on the options. So they had to repull the permit and tried to charge me another $1,100 which I ignored. They paid it.

They have the right to bill me? I think not.


Maybe next time you see them lobbying on the capital steps with the governor, comptroller, AG, and legislature slobbering all over them, you'll have a better appreciation for why unfettered, unquestioned development and carte Blanche for builders may not always be the best idea.

The list could go on forever, but the recent flooding in May, 2019, in Kingwood was 100% caused by unscrupulous builders. Clear cut, fill in the Bayou, and slope the land toward the Elm Grove subdivision next door. Next they claim it was an act of God, and have the audacity to sue the people they just flooded.

Builders are snakes, they don't police their own, and they only care about one thing - get paid before it hits the fan. Caveat emptor.
94chem
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Recent Same Ole Thing in Montgomery County

Quote:

The prevailing sentiment: that [building detention ponds] could affect investments in new developments.

The job of the builder/developer is to bend the law, peddle influence, get paid, and get out of Dodge. I'm sure there are some ethical ones, but if you approach them as if they were politicians, you can possibly avoid some headaches.
rwtxag83
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So you bought a 2 car garage house that had an option for stone elevation at X $$$, which you agreed to. Then at some point you say, Oh, I also want a 3 car garage. They say that's 11k. Then they come back and say, that was just the price for the 3rd car garage bay itself, if you want stone on that too, it'll be $4900 additional.

They quoted you the price of a stone elevation on a 2 car garage--you agreed.

You wanted a 3rd car bay for $11k--you agreed, but you never specified to the builder that you also want stone their too, you just assumed. They also never specified you wanted stone their too.

BTW, $11k for 3rd car garage is a good deal.

Now, you want to know if you have to pay it. Sounds to me like they were open and honest in pricing, and you both made assumptions. Builder says let's be clear about what that price includes, $11k does not include stone.

Series of assumptions on both your and their parts.

Pay the $$ and get it the way you want. It's not unreasonable.

Or walk away and lose your deposits over principle. IMHO, that seems ridiculous, but if it makes you feel better.

You're doing business with somebody who is out to try to build you what you wanted honestly. It should be a mutually beneficial transaction. They aren't asking for an unreasonable amount. Nobody in their purchasing dept is laughing at you or calling you a sucker for agreeing to pay for what you really wanted.

Now, as a buyer, I might feel like I shouldn't pay it if I initialed on drawings for the 3rd car garage elevation that included stone on it. That would mean they purposefully planned it with stone, but just screwed up and left it off. If this is the case, I would ask to speak to the manager and state why you feel they should build what they represented at the price you signed for. Otherwise, see above.
Greater love hath no man than this....
AG Custom
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All builders are bad, all builders are crooks, all builders make excessive money and can easily throw it away without regard, all builders don't care about their clients and only the money, all builders try to cut corners, all builders are not honest, all builders overcharge, builders are expected to be perfect and build perfection, all builders use crappy contractors.....the list goes on.

To be completely honest there are lots of builders who do follow a lot of the above and that give the ones who do care, who approach the business with honesty and integrity a pretty bad wrap. I constantly have to overcome that stigma at times with new clients.

I don't fault people who have had bad experiences for feeling that way, but contrary to that, there are good builders who do exist in all markets.
rwtxag83
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Bob_Ag said:

Build It said:

Split it with them and move on. Do you really want to be sideways with the builder? It probably will not work out in your favor in the long run. The gross profit on your house is probably 10-15 percent. The net is much lower. I wouldn't want the guy building my house pissed , thinking he was losing money or irritated at all over a couple grand in the deal. Do this for him and he'll most likely take care of you in other ways. Be hard to work with to prove a point and you'll be disappointed in the end.

In short let the guy make a little money, be easy to work with, you'll both be happy.
Not to sidetrack the convo, but in my area, the profit margins are quite a bit higher than that. I've seen the direct costs and land costs. Gross profit is easily 20+ percent on base floorplans. It goes higher as the options go up.


Not certain where your information came from, but I have been in this business for 17 years, and I have never seen a production builder with those kinds of margins. Maybe a custom builder with a unique product, but not a production builder. Production builder in this case meaning a builder who builds the same plans repetitively in a neighborhood they own the lots.
Greater love hath no man than this....
rwtxag83
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AggieDruggist89 said:

I haven't responded to the email and I will just sit on it. They can't reconfigure the stonework without breaching the contract as the material sheet clearly shows the elevation on what it's supposed to look like.
Just so I'm clear on this, did they provide you an elevation drawing that you initialed/signed that had your 3rd car/side load garage with stone on it? Or was the 3rd car/side load garage an option you selected after you initialed the stone elevation with a 2 car garage?
Greater love hath no man than this....
03_Aggie
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rwtxag83 said:

So you bought a 2 car garage house that had an option for stone elevation at X $$$, which you agreed to. Then at some point you say, Oh, I also want a 3 car garage. They say that's 11k. Then they come back and say, that was just the price for the 3rd car garage bay itself, if you want stone on that too, it'll be $4900 additional.

They quoted you the price of a stone elevation on a 2 car garage--you agreed.

You wanted a 3rd car bay for $11k--you agreed, but you never specified to the builder that you also want stone their too, you just assumed. They also never specified you wanted stone their too.
.


Pretty sad if a production builder operated in that way. Most production builders have a sheet of options with associated prices.
rwtxag83
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94chem said:

AggieDruggist89 said:

AG Custom said:

Always two sides to every story, however sometimes honest mistakes happen.

If it is prior to start of construction and they honestly miscalculated the amount needed and it hasnt been installed yet, then i think the builder is perfectly within his rights as that price would have been higher had they caught that and without it being installed, you still have the option to say no to that addition if you dont agree with the overall total.

If this is already installed and done and they are now coming back to you, then while they might have made an honest mistake, they should honor it.

FYI and contrary to some above posted opinions, $4,900 is not just a drop in the bucket and is substantial amount for all parties involved. The notion that builders somehow make money hand over fist and can just toss away thousands of dollars on each job is just inaccurate. If a builder operates that way, i guarantee they wont be in business for long. Large builders that have the extensive capital wont keep people employed for long who make those type of assumptions or mistakes as well.

I have made many mistakes in my 18 years of owning a custom home building company and have covered all the necessary costs associated with my issues if it was caught after install. I can tell you each one of them stings as this is how i provide for my family.


Give me a break with that clich there are 2 sides to the story. Both side of the story have been posted, mine and theirs. And you can clearly see they claim to have made an error yet the contract is binding. This is not a small mom and pop builder as they are building over 300 houses in this area, all prefabbed crap. I will have to do a major renovation once we close.

They've made other errors before where they pulled the permit before we settled on the options. So they had to repull the permit and tried to charge me another $1,100 which I ignored. They paid it.

They have the right to bill me? I think not.


Maybe next time you see them lobbying on the capital steps with the governor, comptroller, AG, and legislature slobbering all over them, you'll have a better appreciation for why unfettered, unquestioned development and carte Blanche for builders may not always be the best idea.

The list could go on forever, but the recent flooding in May, 2019, in Kingwood was 100% caused by unscrupulous builders. Clear cut, fill in the Bayou, and slope the land toward the Elm Grove subdivision next door. Next they claim it was an act of God, and have the audacity to sue the people they just flooded.

Builders are snakes, they don't police their own, and they only care about one thing - get paid before it hits the fan. Caveat emptor.
The issues you are describing are usually land development issues, not home builder. Every land development/neighborhood has to be approved by local government before they ever put a shovel in the ground. It's rarely unfettered and/or unquestioned. All the drainage has to be desingned by registered engineers, and then approved by local government engineers. Everything is looked at before it's approved.

Why the hate for builders? They are just making a product that people are clearly willing to make long term commitments to spend a lot of money to buy. Police their own? Do restaurants police their own? Auto manufacturers? Appliances? Furniture manufacturers? Computers? Software?

Only care about one thing? Any builder worth their salt who wants to stay in business over the long haul will work hard to build the kind of product to enhance their reputation so people in the market will continue to buy from them. Every builder has to stand behind the structural elements of their product for 10 years. Why, if they are the snakes you say they are, are they not going broke for having to come back and make expensive repairs on large numbers of homes?
Greater love hath no man than this....
The Fife
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Quote:

Every builder has to stand behind the structural elements of their product for 10 years. Why, if they are the snakes you say they are, are they not going broke for having to come back and make expensive repairs on large numbers of homes?

I'm not sure - when is the last time KB Homes went through bankruptcy? They're notoriously bad, at least in the San Antonio area anyway.
powerbelly
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AG

Quote:

Why the hate for builders?
Because homes are often the biggest and most sentimental purchases in people lives. When something goes bad it is much more personal than a bad car deal for example.
rwtxag83
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03_Aggie said:

rwtxag83 said:

So you bought a 2 car garage house that had an option for stone elevation at X $$$, which you agreed to. Then at some point you say, Oh, I also want a 3 car garage. They say that's 11k. Then they come back and say, that was just the price for the 3rd car garage bay itself, if you want stone on that too, it'll be $4900 additional.

They quoted you the price of a stone elevation on a 2 car garage--you agreed.

You wanted a 3rd car bay for $11k--you agreed, but you never specified to the builder that you also want stone their too, you just assumed. They also never specified you wanted stone their too.
.


Pretty sad if a production builder operated in that way. Most production builders have a sheet of options with associated prices.
Yes, they do. In this case, the order in which things happened is very important.

Buyers regularly want to change things after the process has started. This 'sheet of options' you mention, is usually defined for what it is (3rd car garage, side load garage, etc), and it's also usually done with certain assumptions. If a builder includes front elevation brick as standard, then their 3rd car garage bay, or side load garage pre-determined pricing off the 'option sheet' will mean it comes with brick, not stone.

If the buyer goes to their deco appointment and picks out the option to upgrade to stone elevation, and is quoted a price for that, signs an elevation drawing that shows stone on it, then he should expect to get the house as represented on the drawings.

If the buyer wants to add or change the house to 3rd car or side load after you've signed a 2 car elevation with stone, then it's not reasonable to assume the normal option price for these items off an option price list will include stone just because you picked a stone elevation upgrade.

Now, if they quote you a price for a 3rd car garage/side load garage, show you an elevation drawing that clearly shows stone on it, and you sign a change order that has a price you agreed to, that's different. In that case the builder should absorb the difference if they made a mistake.

In this case, the order in which these changes were ordered, and how they were represented at the time is what is key.
Greater love hath no man than this....
rwtxag83
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The Fife said:

Quote:

Every builder has to stand behind the structural elements of their product for 10 years. Why, if they are the snakes you say they are, are they not going broke for having to come back and make expensive repairs on large numbers of homes?

I'm not sure - when is the last time KB Homes went through bankruptcy? They're notoriously bad, at least in the San Antonio area anyway.
They are notoriously cheap in their components, but they are not notoriously bad structurally. If they were that bad structurally, they woulk be out of business very quickly, as structural repairs are very expensive. They are very basic, but their homes don't just fall down to the ground.
Greater love hath no man than this....
ABATTBQ11
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I would argue that if they draw up a change order, they are bound to the price in it regardless. It sounds like OP spec'ed stone, then decided on a 3 car garage, and whoever did pricing did not do their homework on the home and contract. The way OP put it, the builder didn't check the finishes and priced the CO with brick instead of stone, then wanted to up the price after it was signed because they realized their screw up.

If OP was picking from an option sheet with standardized pricing, the builder should have known to disclose or quote a higher price based on the stone upgrade. They're the builder, and it's not like they don't have experience in contracting and estimating. It may not be reasonable for the buyer to expect the same price for a larger garage with an upgraded exterior versus the larger garage with base assumptions, but if the builder were and agrees to that price then that's on them. They're the ones coming up with the pricing and options.
Ol_Ag_02
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http://www.statesonhomes.com/find-your-home/view-community/herons-landing-at-the-river

Research has concluded OP is correct. Nice view, ugly home elevations.
AggieDruggist89
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Yes, my house will sit next to the furthest left house in the picture. Beautiful view of the course, New River and the mountains beyond.



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