How Custom Home Change Orders Work After You Sign a Fixed-Price Contract

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A custom home change order is a written agreement, signed by you and your builder, that changes the scope, price, or schedule of your contract after you sign it and before that work begins.

Signing a fixed-price contract is a big moment. The house, the number, and the plans finally line up. And then a new idea shows up on a walk through the framing.

Our goal at Dunn & Stone is for your final closing number to match your final contract exactly. We do this by walking through each step and decision carefully with you during the design phase. We don't silence you, we listen well at the beginning so that the process goes smoothly.

Change orders still have a place, though, and once you know how they work, they're much easier to handle.

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Key Takeaways

  • A change order is the written, priced, and signed way to change a signed contract. It should be approved before the crew does the work.
  • Most change orders come from three places: changes you ask for, site conditions the contract listed as unknown, and code requirements.
  • On a fixed-price contract, cost overruns on the work already specified stay with the builder. A change order is how new or different work gets added.
  • Construction on recent Dunn & Stone homes averages 210 days once the site is ready. A change order should say whether it adds days before you sign it.
  • The easiest change to make is one decided on paper, during design, before the final contract.
Key takeaways on change orders: write, price, and sign before work; three sources; overruns on specified work stay with the builder; 210-day average construction; the easiest change is made during design.

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What Is a Change Order in Construction?

A change order in construction is a written amendment to a signed building contract that adds, removes, or changes work and records the effect on price and schedule. Both the owner and the builder sign it, and on a home build that should happen before the changed work starts. Once signed, it becomes part of the contract.

On a custom home, that usually means a feature, a finish, or a piece of site work that differs from the plans and the written specification you signed.

A change order covers three things in writing:

  • What is changing, described against the plans and specification
  • What it does to the contract price, whether it adds cost or gives you a credit
  • What it does to the schedule, including any added days

A verbal go-ahead on the job site leaves all three open. The signed page protects you, and it protects your builder too.

A verbal go-ahead leaves scope, price, and schedule open. A signed change order records what is changing, the price effect or credit, and any added days, signed by owner and builder.

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The Three Types of Custom Home Change Orders

Most custom home change orders fall into one of three types: owner-directed, site-driven, or code-required.

TypeWho starts itCommon exampleHow it reaches the schedule
Owner-directedYouAdding a feature you passed on during design, or upgrading a finishDepends on what is already built and the lead time of the new item
Site-drivenConditions on the lotSoil, slope, or drainage work the contract listed as unknownOften lands early, during site work and foundation
Code-requiredAn inspector or a code requirementWork an inspection calls for that the plans didn't showDepends on the fix and the follow-up inspection

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Owner-Directed Changes

Owner-directed changes are the ones you choose. On our builds, they're typically where our change orders come from.

The biggest one I see is a family deciding to add a feature they had decided against during design. Sometimes their circumstances changed. Sometimes they simply want it done before they move in. Either way, it's your home and your call. The change order just puts the added cost in writing first.

A finish upgrade works the same way. Picking a countertop or tile in a different price range than the one in your contract goes through a change order. We don't use allowances, so the selections in your contract are spelled out from the start.

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Site-Driven Changes

Site-driven changes come from the ground under the house. A good contract names the site conditions nobody can confirm until work starts, such as soil, slope, or drainage, and lists them as unknown.

When one of those conditions turns out to need work, that work is built through a change order. Conditions the contract already priced stay inside the contract number.

This is one reason a homesite evaluation comes so early in our process. The better we understand the lot before design, the fewer unknowns the contract has to carry.

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Code-Required Changes

Code-required changes happen when an inspection or a building code requirement calls for work the plans didn't show.

They follow the same path as every other change: written, priced, and signed before the work is done. Your contract should set out how these changes are handled, so it's worth reading that section with your builder before you sign.

Three types of change orders: owner-directed (started by you, most common on our builds), site-driven (unknown soil, slope, or drainage), and code-required (work an inspector calls for).

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How a Fixed-Price Contract Still Uses Written Change Orders

A fixed-price contract ties one construction number to a dated plan set and a written specification. That number holds for the work those pages describe.

It can still change when you add work or hit a site condition the contract listed as unknown. Material or labor price increases on work that was already specified stay with the builder.

So a fixed price and a change order work together. The fixed price protects the scope you signed, and the change order is the only path for anything new. Each signed change order updates the contract, which stays the single number you close on.

For what the contract price includes, and what it leaves out, see what's included in a fixed-price custom home contract. For the other costs families don't always plan for, see the hidden costs of building a house.

If your build is financed, let your lender know about any change that adds cost or days, because it changes what the construction loan needs to cover. Some construction loans require the lender to approve change orders, so ask yours how it handles them.

On a fixed-price contract, price increases on specified work stay with the builder. Added work or an unknown site condition needs a change order. Contract plus change orders equals your closing number.

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How the Change Order Process Works, Step by Step

The change order process has four steps: request, price and schedule, sign, then build.

  1. Request the change. You ask for it, or your builder flags a site or code condition. The request names exactly what is changing.
  2. Price it and count the days. The builder writes up the change, its effect on the contract price, and any added days to the schedule. The price reflects today's cost, so an item quoted during design can cost more once you're under construction, and a change that holds up other work can add charges of its own.
  3. Review and sign. You and the builder both sign before any of the changed work starts. Take the time you need to read it. On our builds, we don't start changed work until the change order is signed and paid for.
  4. Build it and update the contract. The crew builds the change, and the contract number and schedule reflect it from then on.

That includes small requests on the job site. If you see the electrician on site and ask for one more outlet, the crew can only build what's in the paperwork, so the request still goes through a change order.

Keep every signed change order with your contract. At closing, those pages explain every difference between your original contract and your final number.

The change order process in 4 steps: request the change, price it and count the days, review and sign, then build it and update the contract. Changed work starts only after both signatures.

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When a Change Order Moves the 210-Day Construction Clock

On recent Dunn & Stone homes, construction averages 210 days from start to delivery once the site is ready. From the first agreement to keys, most of our families are on a 9 to 14 month calendar.

A change order can add days to that construction clock, and the written change order should say how many before you sign.

These questions usually decide whether a change touches the schedule:

  • Has that part of the house already been built? A change on paper is quick. Changing something already framed or finished means undoing work first.
  • Does the new item have a longer lead time? Special-order cabinets, windows, and tile carry lead times that start at the order, not at install.
  • Does it need revised drawings or another inspection? Structural and layout changes can mean revised drawings, and sometimes another review or inspection.
  • Does it land during finishes? Finishes take the largest share of construction time, and late changes in that stretch cost the most time.

If the answer to any of these is yes, the change will extend the build timeline.

The change I see most often is a family asking for electrical changes right before sheetrock. Sheetrock has to wait, and then cabinets, countertops, plumbing, and electrical all move with it. Adding a few switches feels like one small thing, but it can push two or three trades behind it. How quickly a change gets decided and paid for has a lot to do with how long it holds the build.

Change orders after groundbreaking cost time and money. That's not a reason to worry, just a reason to ask early. A clear count of added days on the signed page keeps your move-in date honest.

For how the full calendar comes together, see how long it takes to build a house.

Construction averages 210 days once the site is ready, within a 9 to 14 month calendar. A change will extend the build timeline if the answer is yes to any of these: that part is built, has a longer lead time, needs new drawings or inspection, or lands in finishes.

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How to Avoid Most Change Orders on Your Custom Home

The best time to make a change is during design, while it lives on paper and no crew has to undo anything.

  • Start with a realistic number. Run your plan through our cost to build a house calculator before design, so the features you want are part of the conversation from the start.
  • Settle the floor plan before the finishes. I see meetings run long when a floor plan that was already settled gets opened again.
  • Choose finishes from vendors your builder already works with. In our design center, we stay with vendors we already build with and warrant.
  • Use design complete to confirm what you decided. When we sit down for design complete, we walk the drawings against your earlier decisions. If a bedroom still needs to move, we move it in that meeting, before walls are framed.
  • Ask about anything you're unsure of before you sign. It's much easier to settle a question during design than to write a change order during construction.
A change costs the least during design, more after signing, more once framed, and the most during finishes. Five ways to decide early, from a realistic number to confirming decisions at design complete.

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Frequently Asked Questions

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Who pays for change orders in construction?

The homeowner pays for change orders they request, including upgrades, and for site conditions the contract listed as unknown. Cost overruns on work that was already specified in a fixed-price contract stay with the builder. Your contract should explain how code-required changes are handled.

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Can the price change on a fixed-price contract?

A fixed-price contract can change only through a signed change order. That happens when you add work or hit a site condition the contract listed as unknown. The price for the work already in your plans and specification holds.

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Do change orders delay construction?

A change order can add days to construction, depending on what is already built, the lead time of new materials, and whether drawings or inspections need revisiting. The signed change order should state any added days. Changes settled during design have the smallest effect on the schedule.

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What is the difference between a change order and an addendum?

A change order changes the work, price, or schedule of a signed construction contract, usually while the build is underway. An addendum is usually issued before the contract is signed, to clarify or adjust the plans and specifications while they are still being priced. The word is also used for a page that adds terms to a contract. On a custom home, changes to the work after you sign go through change orders.

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Can a builder request a change order?

A builder can start a change order when a site condition the contract listed as unknown, or a code requirement, calls for work the plans didn't show. The builder writes it up, and it still needs your signature before the work goes ahead.

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Are change orders common when building a custom home?

Change orders are common across construction, and on our custom homes most of them come from choices a homeowner makes after signing. Settling design decisions before the final contract is the most reliable way to keep them few.

Change order FAQ: who pays, whether a fixed price can change, schedule delays, change order versus addendum, whether a builder can request one, and how common they are, with short answers.

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Plan Your Home With Fewer Surprises

A custom home should feel exciting from the first sketch to the day you get your keys. Clear decisions during design, and a written change order for anything new, keep it that way.

We'd love to help you plan a home with the goal of closing on the same number you sign. Schedule a free consultation with our team, and we'll walk through your plans, your lot, and your questions together.

Download The Blue Tape Walkthrough Checklist

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