I'd say you have to make selections that are less expensive or, pay the extra costs. We're going through that now as well, I'm trying to spend on things that would be impossible or very expensive to change later on. Structural changes and kitchen cabinetry are where my biggest $$$ is going. I'm choosing cheaper flooring and bathroom fixtures, because those are easier to upgrade in the future.

What do you mean, what should you do? You pay for your upgrades that you have chosen of course. You're not getting them otherwise. Why would you even think you wouldn't pay for them?

Exactly the above. You knew the allowances and chose to spend more than that amount. It comes out of your pocket. He's already discounting his mark-up. What else do you want?

What's fair and appropriate is that you stick to the allowances and pay the quoted price or go over the allowances and pay the difference.

When we built our last house, it seemed like every time I made selections I was over the allowance. Ultimately, I focused on the things that were most important to me as well as things that would be hard to upgrade at a later date and spent extra on those. items and tried to keep in line with the allowances on the other things.

I really didn't think a lot of the allowances we were given were realistic based on the price we were paying for the house but I didn't realize that until we were in the midst of the build.

"What do you mean, what should you do? You pay for your upgrades that you have chosen of course. You're not getting them otherwise. Why would you even think you wouldn't pay for them?"

Because we're not upgrading. If we built with the allowances as they are we'd get junk. Our drawings called out each cabinet, each piece of granite. We reference other homes in our contract, "floors quality similar to xyz house" which the builder built. We gave the builder our business based upon a quote, & the allowances are way off.

We know other customers of his, & have not had this problem. I think the builder estimated the costs before getting quotes from his subs, we signed the deal in 2 weeks, & our house has alot more stuff than normal. Still, we based our decision to go with him based upon his prices.

Based on the advice we got from friends and this forum we chose our lighting fixtures, flooring and plumbing fixtures before we signed the contract, so we had very few allowances. We also had the builder increase our allowances by a significant amount so we can get a bigger loan and avoid his 10% upcharge. In the end, we were only over by 1.3%. So thanks guys!

If your contract specified the materials to be included in your home then why were there allowances?

Allowance are place holders, nothing more, noting less. If your contract is full of allowances, you really have no option other than to pay. If you wanted a firm price you needed to say the exact specs of each product you wanted. That's why it should take a hell of a lot longer than 2 weeks to dot every I and cross every T. Specify, Specify, Specify..........

This thread and the subject of allowances should be required reading, with signatures at the bottom, for every prospective new home owner. The OP said, "...Because we're not upgrading. If we built with the allowances as they are we'd get junk..." Did you sign the construction contract with the allowances as they are?

We had the builder up the allowances before signing the contract in order to have realistic amounts to work with. It's too late for you to do that, but like everyone has said, allowances are not a firm price you have to pay if you go over the set amount. Where we had specific materials specified in the contract the only time that changed was if we did a change order, and paid the difference.

One way to look at it is that the more you pay out of pocket, the less you're paying 30 years worth of interest on!

No help to you, but to others...specify everything. If you cant, then specify a price. We had to do some tile like that. "Master bath shower tile at $10/ft. Master bath floor tile at $6/ft." Etc etc. Even this is problematic. List price or builders discount?

You are lucky he is not marking up the overages. It's probably in his contract he can.

Good luck!

Or he is getting a piece on a discounted price or an under the table deal.

Your builder sounds like an upstanding guy to me. There is no legal reason he even has to offer you the discount, it is your responsibility to investigate unknowns and non specifics in the contract, not his.

Look on the bright side. You are getting the house you want for cheaper than you would get it had he estimated correctly (his 15% markup would have been included in the contract price). Take that and run with it, and give the guy good reviews for being upstanding enough to sacrifice his profit for his reputation, something many people in many industries should take note of.

Our building quotes also included "allowances". Before we decided on a builder we went to the contractors/businesses they used, with our floor plan, sat down and got an independent quote on specific items. We did this for granite, windows, door and kitchen/bathroom cabinets. We went with builder grade and made choices we thought were very reasonable ie) kitchen drawers can come with stainless steel siding or a cheaper wood. We went with cheaper wood to keep costs down. Drawers and pull outs in a cupboard cost more, so we chose where we wanted them them the most ie) for larger things such as flour and sugar.

Granite- we chose a colour a little greyer than we wanted because it was cheaper . Windows...I was set on having black...must above all else have black inside and out.....we've ordered WHITE. Do I regret this..maybe a bit. But it was amazing how black windows snowballs into black garage doors, trim work, down spouts which all require additional painting and push back time which equals money out of our pocket. Not to mention the windows them selves were much cheaper going with white. IE) our "allowance" for windows and doors was 20 grand...if I got what was in the plans as specified it would have in reality cost 29 grand plus hardware after meeting with several different window/ door people. I was willing to pt the money out on the windows but not the extra on the garage doors and the custom down spouts and the extra 3 week lead time to have it all painted.

After meeting with all these people independently we realized the "allowances" are bare minimum. We would have ALWAYS gone over. Meeting with the trades and kitchen/cabinet places before hand allowed us time to re-evaluate and come up with better ideas that meet the budget...mostly.

Our house looks nothing like what I had in mind at the start aside from the floor plan. The house is ever evolving, I equate it to being very drunk. You have a destination in mind but you cant get there in a straight line.