House already under contract can the builder cancel contract?

[Sophia Berry]

Hello all,

I've seen on the news that if a New Construction home is under contract that has not broke ground.  The prices of lumber ect has now gone up.  Can the builder make the buyer cancel the contract and charge them more for the home?

[Dustin Allen]

@Sophia Berry

The seller cannot make the buyer cancel the contract.  Builders can put in a clause that states that if materials rise in cost more than XX%, they can increase their price to compensate.

Whether they have some other mechanism built in to be able to cancel the contract themselves, depends on your contract.  This is where a good REALTOR will pay for themselves by making sure you are protected and fully aware of all the terms of your contract.