Builder wants to cancel contract. What can I do?

[Melanie Liu]

We signed the purchase agreement back in December 2020, and it was scheduled to be completed by 4/15/2021. However, the builder has been delaying the building, and recently we were told that they wanted to cancel our contract due to building cost increase, or we can accept the $100K increase in price. BTW, the builder hasn't even started digging yet. 

What options do we have now? Does this happen to other buyers / owners? I'm mad because if they could have told me much earlier that they couldn't deliver on time / price, then I would have moved on to another house. After months of delay and big appreciation in general market, it's hard to find another house at that price range.

Like to hear your suggestions. The house is in Texas.

[Charlie MacPherson]

@Melanie Liu  It's not surprising as lumber prices have skyrocketed in the last year.  If the builder followed through with the build, he might end up with a significant loss.

That said, a contract is a contract.  If there's no language in the contract about unforeseen increases in material pricing, he may be stuck and you need the advice of an attorney.

My suggestion is to see if you can get him to pay you for the release.  Again, work with an attorney on that.