PROGRESS
PAYMENT
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The
valuer may be called upon to value progress payments payable to the
builder during the course of construction of the building. This is
because standard form building contracts (eg
HIA,MBA) require
the payment of the VALUE of work completed not cost. Therefore, if
progress payments are determined by quantity surveyors or architects
they are carried
out by those not expert in value. The improvements nay not be the
highest and
best
use.
The
amount payable should be determined using the before
and after
method of valuation and
the difference
is the progress payment. Materials delivered to the site pending
fitting and installation cannot
be included in
the progress payment as they are not part of the structure,
they are not
fixtures. The valuer's final certificate of payment is withheld until
all relevant authorities, and experts have issued the
certificates of
compliance and completion.
There are a number of methods
by which a builder can claim payment for work completed but
progress payments is the most common and now standard in the main
building contracts.
Progress payments are
usually paid
either monthly, at definite stages of construction, or at other
intervals depending upon the terms of the building contract.
The
following are
typical buildings
stages used in calculating progress payments:
|
STAGE |
PROGRESSIVE % |
|
Deposit 10% |
10% |
|
Floor slab 10% |
20% |
|
Roof frame 15% |
35% |
|
Close up 35% |
70% |
|
Fixing/kitchen 15% |
85% |
|
Painting 10% |
95% |
|
Practical completion 5% |
100% |
|
PLAIN |
ENGLISH |
CONTRACT |
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% |
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1 DEPOSIT |
5 |
should not exceed $10000 |
|
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2 FLOOR SLAB COMPLETE |
|
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Footings poured |
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Stumps, piers or columns complete |
|
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Beams & joists compete |
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Internal & external drainage complete |
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Electrical, gas & plumbing rough in below floor complete |
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Floor slab poured |
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10 |
15 |
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3 ROOF FRAME COMPLETE |
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All farmes straightened |
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Widnows nailed off |
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Electrical, gas & plumbing rough in completed |
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Bath installed |
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Front & back door complete with locks |
|
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Eaves, barge, external wall cladding & roof covering is fixed |
|
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15 |
30 |
|
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4 CLOSE UP COMPLETE |
|
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All farmes straightened |
|
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Windows nailed off |
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Electrical, gas & plumbing rough in complete |
|
2nd FIX |
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Bath installed |
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Front & back door complete with locks |
|
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Eaves, barge, external wall cladding & roof covering is fixed |
|
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35 |
65 |
|
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5 FIXINGS COMPLETE |
|
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All internal architraves, skirtings doors, cupboards & detailed joinery installed |
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Plasterboard finished, sanded & cornices fixed |
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Exterior downpipes fitted & penetrations complete |
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Decks and landings complete |
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15 |
80 |
|
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6 PAINTING COMPLETE |
|
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All ceramic tiling installed |
|
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PC items installed |
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Interior & exterior painting completed |
|
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|
15 |
95 |
|
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7 PRACTICAL COMPLETION |
|
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All interior fitoff items installed incl door furniture, robe rails, abthroom accessories |
|
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Electical plumbing & gas fitoff installed |
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House cleaned internally & externally |
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Site cleared - excess items removed |
|
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|
5 |
100 |
|
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|
ADELAIDE |
BANK |
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|
1ST STAGE |
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|
Site 2% |
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Footings 3% |
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Floors 5% |
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Brickwork 30% |
40% |
40% |
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2ND STAGE |
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Roof carpentry |
10% |
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Electrics |
2% |
|
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Roof cover |
5% |
|
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Plumber |
4% |
|
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Plaster float |
3% |
|
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Ceiling |
3% |
|
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Paster set |
2% |
70% |
|
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|
3RD STAGE |
|
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Fixing 10% |
|
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Plumber 4.5% |
|
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Tiler 5% |
|
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Painter 5% |
|
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Electrics 3% |
|
|
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|
Grano 1.5% |
|
|
|
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Clean 1% |
|
100% |
|
|
See: