New member with a big problem! Contractor wants more money
Hello, I have lurked on this site for a long time and leeched a lot of great information. I finally have something worth registering and posting about.
I made a long winded post regarding a contractor that wants more money beyond our contract price in the new construction forum and it unfortunately didn't get any traction so I will simplify it. I have a fixed price contract for a new home construction that was delayed by a 3rd party by approximately 8 months. The contractor attributed to almost 3 months of the delays. He is now claiming material price and labor increases over 6 months to the tune of $40000 (total project price is $292000). My attorney has reviewed our contract language and strongly believes I am not liable for this additional cost and that the job was significantly underbid. There is no escalation clause or completion deadline. The price increases are 25-55% on most line items (drywall 55%, lumber 45%, electrical 40%, etc). I believe these are unreasonably inflated but unfortunately, legitimate.
We are currently attempting to resolve this with the contractor. His solution to start with is to cut all of the finishes that we added ($21000ish). He currently has not offered to make any concessions to his profit line except that he's doing the line items that are over "at cost" and is attempting to justify this by the fact that the home will still have significant equity even with the overages.
We are still moving forward, framing is set to begin next week. Does anyone have any advice for me as I'm feeling taken advantage of. I do not have any prior real estate investment experience. Any advice on how to proceed by anyone with experience in this field would be incredibly valuable!