Progress claims are where the money changes hands on a home build, so they're where a lot of arguments start. Builders want to be paid on time for work they've done. Homeowners want to be sure the work is actually done before they pay. Most disputes come from one side or the other not understanding how claims are supposed to work.

This guide is written mainly for builders, with a section at the end for homeowners. It's based on Queensland domestic building rules and the QBCC New Home Construction Contract.

small steps are still progress image
Photo by Hayley Murray / Unsplash

What is a progress claim?

On a fixed-price home build, you don't pay the whole price at the end. The contract splits it into a deposit and a series of stage payments. When the builder completes a stage, they issue a progress claim for that stage's payment.

Typical stages on a new home are:

  • Base (slab or footings)
  • Frame
  • Enclosed (lock-up)
  • Fixing
  • Practical completion

The contract sets out what each stage includes and what percentage of the price is due at each one.

The Queensland rules that matter

Under Schedule 1B of the QBCC Act:

  • Deposit limits. For contracts of $20,000 or more, the deposit can't be more than 5% of the contract price. Under $20,000 it can be up to 10%. Different limits apply where more than half the price is for off-site work.
  • Claims must match the work. Apart from the deposit, a builder can only claim an amount that relates directly to the progress of work on site and is no more than the value of that work.

That means front-loading isn't allowed. You can't weight the early stages heavily to get ahead on cash flow. Each stage payment has to reflect the real value of the work done at that stage.

On a fixed-price contract, the stage percentages are set in the contract when it's signed. They aren't a flexible schedule you adjust as you go. Changes to the work and the price go through written variations, signed before the work is done.

How to prepare a progress claim (builders)

  1. Check the contract. Make sure the stage is complete as the contract defines it, not just mostly done.
  2. Get the certifier's inspection where one is required for that stage (for example, frame).
  3. Write the claim. Include the stage, the amount, the contract reference, and any approved variations being claimed with it.
  4. Attach evidence. On a fixed-price contract, that means clear, dated photos of the completed stage and the certifier's inspection certificate where relevant. On a cost-plus contract, you also attach invoices and timesheets, because the client is paying actual costs.
  5. Double-check the numbers before you send it. Simple maths errors delay payment.
  6. Send it in writing as the contract requires, and keep a copy.

Photos: your best evidence

Photos settle a lot of arguments before they start.

  • Take them at each stage, from several angles, before the next trade covers the work.
  • Make sure they're dated and labelled by location.
  • Show the key items the stage includes, such as the completed frame, tie-downs and bracing at frame stage.

Check subcontractor invoices before you claim

As the principal contractor, review every subbie's invoice before it feeds into your costs:

  • Details match the subcontract (address, prices, scope).
  • No overlap with work already invoiced.
  • You've inspected the work and it's done to standard.

Approve, part-approve or dispute it in writing, and keep the records. Don't pay for work you haven't seen.

If a claim is disputed

  • Talk first. Ring the owner, find out exactly what they're unhappy with, and offer to walk the site with them. Most disputes are misunderstandings that a site walk fixes.
  • Respond in writing with any extra evidence.
  • Follow the contract's dispute clause and its notice periods.
  • If that doesn't resolve it, QBCC's early dispute resolution service is the next step, and QCAT after that. Get legal advice before things escalate.

Keep building where the contract allows. Letting a dispute stall the whole job helps nobody.

Builder's checklist

  • Claim only completed stages, as defined in the contract.
  • Attach dated photos and inspection certificates.
  • Check the contract notice and payment periods.
  • Follow up overdue claims promptly, in writing.
  • Keep records of every claim, payment and variation.

If you're the homeowner

A valid progress claim should:

  • relate to a stage that is actually complete as the contract defines it
  • match the percentage or amount in your contract
  • come with evidence, such as photos and the certifier's inspection where one is required
  • include only variations you've signed

Before you pay:

  • Never pay for a stage before it's reached, no matter how it's worded.
  • Inspect the work yourself, or get an independent inspector to do it.
  • Read your contract's notice period for disputing a claim, and raise any problem in writing within it.
  • Ask your lender how they handle stage payments, as they'll often send their own valuer.

My stage inspection checklists cover what to look at before each stage payment, from the slab through to practical completion.