Charging for quotations is not a common building industry practice. But builders can pick and choose their jobs, and charge for quotes and in order to discourage “check pricing” by some consumers.
A problem can arise when some financial institutions require three quotations before approving a loan amount. Many builders particularly in regional areas are regularly approached for a quotation. They spend many hours preparing costings and the final contract price, only to be told by the client that they were not the preferred builder anyway. The quotation was needed to verify the price offered by the builder of their choice.
This practice has caused frustration and resentment among some builders and they then charge for their professional services used in preparation of a quote. There is nothing illegal about this. Parties are free to bargain over the terms of this or any other arrangement.
One compromise which might suit both parties is that a fee be imposed which can be deducted from the contract price should you decide to go ahead with that builder. Given that builders can load all their prices to cover the provision of “free quotes”, a “deductible fee” practice may mean lower prices generally. There would be no need for a builder to factor in to all his contracted work an amount for time spent on quotations that are not successful.