Quick answer: A good house construction contract in Pakistan should clearly define the scope, drawings, specifications and BOQ, the price and payment milestones, how material price changes and variations are handled, the schedule and delay penalties, quality checks, a defects liability period with retention, and a dispute resolution process. Vague contracts are the main cause of cost overruns and disputes between homeowners and builders.
The 15-Point Contract Checklist
1. Parties and project details
Full names, CNIC or company registration, addresses, plot number and society or authority.
2. Drawings and documents
List every drawing by number and revision: architectural, structural, electrical and plumbing. State which document prevails if there is a conflict; structural drawings should govern structural work.
3. Scope of work
State exactly what is included and excluded: grey structure only, finishing, elevation, boundary wall, tanks, approvals, utility connections, landscaping. Our grey structure inclusions checklist helps define this.
4. Material specifications
Name brands or approved equivalents, grades and sources: cement brand, steel grade, brick class, sand and crush source, concrete and mortar ratios, pipe brands. See our A, A+ and A++ specification guide.
5. Bill of quantities (BOQ)
An itemized BOQ with quantities, units and rates makes variations and payments transparent.
6. Contract price and type
Fixed lump sum, per sq ft, or BOQ-based re-measurement. State whether the price includes labour only or labour and materials. Compare options in labour rate vs with-material contracts.
7. Payment schedule
Tie payments to completed, inspected stages such as foundation, plinth, each slab and plaster, not to calendar dates. Keep the advance reasonable.
8. Price escalation
Agree whether prices are fixed or adjustable for major materials like steel and cement, and how changes are calculated and documented.
9. Variations and change orders
All changes must be agreed in writing with price and time impact before the work is done.
10. Schedule and delays
Start date, milestone dates, completion date, and what happens if either party causes delay. Allow fair extensions for weather or authority delays.
11. Quality control and inspections
Owner's or engineer's right to inspect before concealment, at steel fixing, slab casting, plumbing and electrical stages. Include testing such as concrete cubes and pressure tests. Use our quality checklist.
12. Site safety and insurance
Contractor's responsibility for worker safety, safe scaffolding, protection of neighbours and any damage caused.
13. Defects liability and retention
A defects period after handover (for example 6 to 12 months), with a retention amount (for example 5 percent) held until defects are fixed. Include warranties for waterproofing and termite treatment.
14. Termination
Conditions under which either party can end the contract, and how completed work and materials will be valued.
15. Dispute resolution
Steps for resolving disputes: negotiation, then mediation or arbitration, before court.
Red Flags When Hiring a Contractor
- Refusal to give a written contract or BOQ
- Very low per sq ft rate with vague specifications
- Demand for a large advance before work starts
- No completed projects you can visit
- Payments requested by date rather than progress
See our guide on choosing the right construction company in Lahore, and our advice for overseas Pakistanis hiring a builder.
Documents to Keep During Construction
- Signed contract, drawings and BOQ
- Payment receipts and invoices
- Written change orders
- Inspection records, photos and test results
- Material delivery records and warranties
Planet Builders provides written contracts with itemized BOQs and stage-linked payments for every grey structure and turnkey project.
This checklist is general guidance, not legal advice. For large or complex projects, have the contract reviewed by a lawyer.
Frequently Asked Questions
What should a construction contract include in Pakistan?
Scope, drawings, specifications, BOQ, price, payment milestones, escalation, variations, schedule, quality checks, defects liability, termination and dispute resolution.
How much advance should I pay a contractor?
Keep the advance modest and link further payments to completed, inspected stages. The exact amount should be agreed in the contract.
What is a retention amount?
A percentage of payment, often around 5 percent, held back until the defects liability period ends and defects are fixed.
Should the contract be on stamp paper?
Many owners execute contracts on stamp paper and have them witnessed. A lawyer can advise on stamp duty and registration requirements.
Want a transparent contract for your home? Contact Planet Builders & Interiors.