Choosing the wrong builder can turn your dream into a financial nightmare.
Unfortunately, many homeowners fall victim to hidden scams, false promises, or unprofessional builders.

This article highlights the most common red flags and scams to watch out for before signing a construction deal — and how to protect yourself.

🧱 1️⃣ Unrealistically Low Price per Sq.Ft.

If one builder’s quote is significantly lower than others, it’s a big warning sign.

🔍 What happens:

• They quote low to win your trust.

• Later, they add “extra charges” for materials, design changes, or foundation.

• The final cost becomes much higher than expected.

✅ How to avoid:

• Compare multiple quotes in detail (materials, inclusions, finishes).

• Ask for a clear BOQ (Bill of Quantities) before signing.

• Remember: Good quality work has a fair price.

📄 2️⃣ No Written Contract or Vague Agreement

A verbal promise or a simple one-page paper is not enough for construction worth lakhs or crores.

🔍 What happens:

• The builder avoids a detailed written agreement.

• Terms about materials, payment, timeline, or warranty are missing.

• Disputes later — you’ll have no proof to claim.

✅ How to avoid:

• Always sign a detailed construction agreement mentioning:

  • Scope of work

  • Material brands and specifications

  • Payment schedule

  • Timeline and penalties

  • Warranty clause

• Get a civil engineer or legal expert to review before signing.

💰 3️⃣ Hidden Costs and Unexplained Extras

Some builders quote a low price but exclude essential items like:

• Compound wall

• Plumbing & electrical fittings

• Painting, tiles, or kitchen granite

You’ll realize these are extra only after construction starts.

✅ How to avoid:

• Ask for “all-inclusive” cost upfront.

• Get a written list of what’s included and excluded.

• Clarify about GST, approval fees, and borewell charges.

🧾 4️⃣ No Proper Receipts or Payment Records

If the builder insists on cash payments or doesn’t give proper receipts — beware.

🔍 Why it’s risky:

• You lose legal proof of payments.

• Hard to claim warranty or accountability later.

✅ How to avoid:

• Make all payments through bank transfer or cheque.

• Keep copies of invoices and stage-wise receipts.

• Never pay large advances — pay stage by stage as work progresses.

🧰 5️⃣ Poor Material Quality Despite Promises

Some builders promise “premium materials” but secretly use low-grade cement, steel, or tiles to cut costs.

🔍 Warning signs:

• No visible brand markings on site materials.

• No bill proof or delivery receipts shown.

✅ How to avoid:

• Mention brand names in the contract (e.g., UltraTech cement, JSW steel).

• Visit the site during key stages.

• Ask for material purchase bills or site photos as proof.

🧑‍💼 6️⃣ Unregistered or Fake Construction Firms

Many so-called “builders” operate without a company registration or GST number.
They may vanish mid-project or deny responsibility.

✅ How to avoid:

• Check if the builder has:

  • GST registration

  • RERA registration (if applicable)

  • Official business address & website

• Verify their company name and registration number online.

🏗️ 7️⃣ Subcontracting Everything

Some firms take your project and immediately outsource it to third-party contractors.
That leads to poor quality and no direct accountability.

✅ How to avoid:

• Ask who will execute the work — in-house team or subcontractor.

• Include this in your written agreement.

• Visit one or two active sites to confirm the same team is working.

⏳ 8️⃣ No Clear Timeline or Frequent Delays

A professional builder always commits to a timeline with stage-wise delivery.
If your builder keeps giving vague dates — that’s a problem.

✅ How to avoid:

• Add a completion date and penalty clause in the agreement.

• Track progress every month — ask for site photos or visit personally.

🧱 9️⃣ No Proper Supervision or Site Engineer

Unsupervised sites often lead to poor workmanship and rework.
Many small contractors leave the site to laborers without daily monitoring.

✅ How to avoid:

• Ensure a qualified site engineer is appointed.

• Get periodic updates with photos and videos.

• Check supervision frequency in your contract.

⚠️ 10️⃣ Builder Avoids Showing Past Projects or References

If a builder hesitates to show completed homes or share client contacts — big red flag.

✅ How to avoid:

• Visit at least 1 or 2 finished homes built by them.

• Speak to old clients about their experience and delays.

• Check online reviews and ratings.

📋 🔚 Final Safety Checklist Before Signing

✅ Check registration (GST / RERA / Company details)
✅ Ask for detailed quotation with inclusions
✅ Sign written agreement only after reviewing all clauses
✅ Verify ongoing project sites
✅ Make payments only via bank
✅ Don’t rush — a genuine builder never pressures you

🧠 Final Thoughts

A good construction firm builds trust as much as walls.
Don’t get carried away by flashy brochures or low prices.

Choose a builder who is:

• Transparent with documents and pricing

• Open to site visits and questions

• Ready to sign a detailed, fair agreement

Your home is a long-term investment — and choosing the right builder ensures peace of mind for years to come.