Understanding Construction Contract Variations
When it comes to residential construction or renovation, one of the most common, yet often misunderstood, aspects of the process is contract variations. Whether you’re building a new home or updating your kitchen, understanding how variations work can help you avoid surprises, plan more effectively, and maintain a smoother relationship with your builder.
What Is a Construction Contract Variation?
A contract variation refers to any change made to the original scope of works as outlined in the building contract. This could include adjustments to the materials, methods, timelines, or costs associated with the project. Variations can be initiated by the client (you), the builder, or even arise due to external factors.
Examples of variations:
Upgrading materials (e.g., changing benchtops from laminate to stone)
Adding extra features (e.g., installing underfloor heating)
Uncovering unforeseen issues (e.g., discovering termite damage or asbestos)
Changes in council requirements or compliance standards
Supply chain disruptions requiring alternative products
Why Do Variations Happen?
While it might seem ideal to have everything locked in from the start, construction is a dynamic process. Variations can occur for a variety of reasons:
1. Client-Initiated Changes
As you see your project come to life, your preferences may evolve. It’s common to tweak designs, change finishes, or add new features once you have a clearer visual of the end result.
2. Unforeseen Site Conditions
No matter how well you plan, some conditions only become apparent once works begin. For example, soil instability, hidden water damage, or outdated wiring are all things that may require an unexpected response.
3. Design Clarifications
Sometimes plans drawn at the start need refining. As construction progresses, ambiguities in design documents may require clarification and corresponding variations.
4. Regulatory or Supplier Changes
Building codes, council requirements, or product availability can shift mid-project, prompting necessary updates to the scope or methods.
Are Variations Avoidable?
In short: not always.
While thorough planning and clear documentation can reduce the number of variations, they cannot eliminate them entirely. Even the most carefully designed and costed project may still face unexpected adjustments. The goal is not necessarily to avoid all variations, but to manage them transparently and proactively.
Why a Contingency Fund Is Essential
This is where having a contingency fund becomes critically important. A contingency is a set amount of money, typically 5–10% of your overall project budget, set aside specifically to cover unforeseen changes or additional costs.
Benefits of a contingency fund:
Reduces financial stress when variations arise
Prevents delays due to funding shortfalls mid-project
Allows flexibility for upgrades or changes you might choose to make
Maintains trust and momentum between you and your builder
Without a contingency, you may be forced into rushed decisions or have to cut corners to stay within budget, potentially compromising quality or satisfaction.
Final Thoughts
Contract variations are a natural part of most construction journeys. When managed well, they can enhance the outcome of your project, allowing for improvements, solving hidden issues, and keeping things compliant with changing requirements.
By understanding what variations are, why they happen, and budgeting wisely with a contingency fund, you’ll be better prepared for a smoother, less stressful building experience.
Need help navigating a renovation or build? At Evermore Construction, we pride ourselves on clear communication, transparent pricing, and helping clients make informed decisions, even when plans evolve. Get in touch with us today to talk about your project.
