Owner-Builders: Pitfalls and Savings
mdfacc
14 years ago
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twolabs
14 years agolast modified: 9 years agomdfacc
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Attn: Owner Builders: How much did you spend per sq ft on home?
Comments (45)Wow, am I envious! I live in the Tampa Bay area and we are hoping to come in somewhere about $110-120/ft. Average prices are between $175-300/ft. The main thing to consider is that our building codes are probably some of the strictest in the country due to the hurricanes. The home is built to withstand 130mph winds. It is built from concrete block which definitely increases our cost substantially. As we are the GC, we did hire a manager to over see the entire project (he also did the slab/block/frame). But the money we are paying him to manage is definetly worth the peace of mind! He is very reputable in our area and has many many contacts so we are able to get his pricing. In the end, his management fee will probably wash with the savings. We are also going pretty high end with everything else from windows to appliances to flooring and so forth. In the end, it will all be worth it. However, our cost to build does not include what we paid for the lot. Land is NOT abundant here and you pay for it - ALOT. Our lot had a home which we initially wanted to add on to. But after talking with our architect and engineer, the cost was more to do that (by going up a floor) than it was to demo and start over. We went that route since then we are not limited to the footprint and could then have exactly what we wanted. Our new home is 4000 sq ft living/8900 sq ft under roof incl 1500 sq ft covered lanai/3 car garage/semi-detached 4 car garage. So, with all of this, in the end we should be about $450K (not including pool). For Florida, this is not bad at all....See MoreOwner Builder Questions
Comments (17)I am a woman and the GC on our house. We had a GC to start, but ended up being our own. You are capable of doing it, it's more a matter of whether you really want to once you know more about it. Live Wire Oak's comments were spot on. If you know good subs, are willing to spend a lot of time researching the correct way things should be done and have a lot of time to babysit and enough assertiveness to stay on subs, you will be successful. You will also spend more money than you think - you will find out the best way to do things and want to go that route for more $ and you won't get all the same price breaks GC's get. I do not work outside the home and do not have young children, have the help of my parents and husband, yet am very busy, exhausted and stressed. You have to be up early and at the site to make sure deliveries are correct, workers have shown up and that they are doing a good job. You have to line up the next subs and be organized, but at the same time flexible. There will be delays due to weather, in material delivery, in subs (sickness, "emergency jobs", injury, etc.) If you are very organized that is good, but you must be just as good at being flexible. If one sub can't make it, can you have a different sub come in earlier without messing things up? For instance, my original GC wanted to keep the inside of the house on schedule so wanted insulation and drywall to go up before the exterior brick was installed and before heat was in (winter time). We said no, which was one reason we parted ways. If you can get a really good GC (which was hard in our small town), you can turn over all these types of issues to them. We got the best in our small town, but that is relative when there is not much competition. We like the control we have over the project now, but things have taken a lot longer than if we had a GC throughout the whole project. The good subs are busy, many of them for GCs, so we are a side job that they work in. Therefore we have to be flexible, but we are almost two years into the build and we aren't done. We had to wait six months for a chimney leak to be fixed (weather dependent) and then for the mason to work us in to fix it when weather allowed. If we had to do it again, we would definitely prefer a competent GC vs doing it ourselves - some days. :-) Some days the fee is worth it - it's hard enough just keeping up with appliance, cabinet, trim, flooring, paint choices, let alone the actual building process. Other days there is a feeling of accomplishment that yes, I can do this. To address some things more specifically: As far as knowing how things should be done, it's true you don't have to know everything, but you must know enough to make sure you have a competant GC/Subs and inspector. For instance, we had three really important things that our GC did not ensure was done, nor did our building inspector. 1) Of all our small town masons, only one knew how to put in weep holes and that it was necessary. Although building code required it, in our small town the inspectors did not enforce it. Our GC didn't even know it was code until I brought it to his attention. 2) Our foundation is concrete block. We are built into a hill. We did not know until later that the concrete blocks were supposed to have rebar attached to the footer and then cement poured in every 4 feet. When we became our own GC and had the perimeter drain redone, the structural engineer for that job noted the pressure against the blocks and asked about reinforcement. It cost an arm and a leg to fix it. When we talked to the inspector, he said rebar and cement was only required if you had uneven backfill and/or the blocks are over 5 feet high. Our GC did not tell the inspector where the backfill was going to be ahead of time and not until we realized later that we had too much pressure on one foundation wall section, did we have to pay for a "retrofit" to install rebar and cement. It however isn't as good because the rebar is not attached to the footer. This is an example of needing to know what should be done and not relying on inspectors (or our GC for that matter). 3) It ended up our bricked chimney had a massive leak from the mason laying the brick in hot weather, without pre-wetting the brick, so the mortar flash dried creating small cracks. He also didn't install thru the wall flashing. The blueprint called for thru the wall flashing around windows and on the chimney. The GC did not tell our masons to do this. When I called the mason back to come do the chimney because of leaking, he said just spray a sealant on it - he had never done thru the wall flashing. We ended up having to call in a commercial mason to install thru the wall flashing. All of these things were learned AFTER we became the GC and read the blueprints. (You need to know how to read them and interpret them.) In addition, all these things were inspected and passed by our building inspector. You cannot rely on your inspector - you must know it. When we talked to our inspector about these issues, he said his job is to enforce code that his county is enforcing. These are MINIMUM standards - not best practices. Regarding a loan, we fortunately have a loan through Farm Credit and they allow owners to be their own GC, but most banks do not. In addition, we don't have a separate construction loan. It was a regular mortgage loan that incorporated the construction part. Therefore we don't technically have a time limit, but we do have to make progress and keep them informed of the progress. Most banks have a 1 year limit, which unless you have everyone lined up and contracted and will not change your mind on anything substantial during the build, it may be possible, but it will be hard if you are doing it all yourself. Also, you do have to be assertive, be willing to fire subs if they are doing a poor job and basically babysit - especially if they quoted by the hour then by the job. However, sometimes when they quote by the job, they cut corners, so you have to watch that too. Also, some subs require payment right away (down payment, then when the job is over). In our small town, sometimes they want money early. It can be stressful coming up with money ahead of time before getting the next draw from the bank. Plus you have to make sure they sign lien waivers when work is done so you don't have liens put against your house by unscrupulous people. You must also remember to make sure you obtain certificates of liabilities from everyone BEFORE they start work. If they don't have insurance, don't hire them. If I had trouble with a sub (just a few), my husband would step in to be the heavy, but in general I didn't have a problem. If I interviewed someone that treated me strange or made a comment about me being a woman GC, I didn't hire them unless I really wanted them based on their reputation. I think that only happened once, but I made sure my husband made an appearance every now and then. Since you have family nearby, have a male member be on call if needed. You are doing the right thing by getting advice and researching first. It may seem simple in theory - just hire good subs, but there is more to it and finding good subs, isn't always easy. If you hire people that have done work for people you know, that is best. Reading BBB or Angie's list reviews isn't always reliable. If you decide to do it, be sure to ask GW for any advice along the way or just for researching. We have found GW, John Bridge, HVAC Talk, Contractor Talk, Roofing Talk, Terry Love, Building Science, NAIMA, the Brick Industry Assoc and a few other forums/informational sites that I don't remember now very helpful and willing to answer questions from novices. At least bouncing things off the pros is helpful. Reading technical journals and instructions isn't always reliable when it comes to real-life applications. Some instructions are for specific regions also, so your weather and climate may affect what is done. Good luck! This post was edited by RQHome on Mon, May 26, 14 at 12:35...See MoreAlternative owner builder financing.
Comments (18)Thank you for the advice everyone, I will definitely take it into consideration. But there seems to be a lot of misconceptions by many of the posters here. One of them being that since I am young, this is a spur of the moment decision and I haven't thought about anything. Maybe that is my fault for lack of details. I bought my land when I was 21 years old. It has county water, septic sized for a 3 bedroom house, and electric. I "practiced" my skills on a mobile home on the property and sold it earlier this year for a nice profit. I have also been the right hand man to my dad while remodeling his house. I have no interest in buying houses to flip, or living anywhere else other than on my property. Buying houses to fix up and sell later is just as risky as anything else, there is a lot that can go wrong. I have spent the last 2 years designing this house myself and planning, researching, reading, and learning about every aspect. Financing is probably one thing I could have spent more time thinking about. Secondly, many of the same posters have not clearly read what I wrote. Some of you seem unaware that Discover is more than a credit card company. I have a savings account with them earning 1.5% interest. They do personal loans, and banking as well as credit cards. I am not saying I will charge my credit card. As I said in the original post, I would get a personal loan. At 6.99% for 84 months. Borrowing from my 401k is an option most people naturally reject. But according to T Rowe Price, if I borrow 40k and continue my existing contributions, my balance at retirement age will only be 11k less than if I had not taken the loan. At 5.75% interest for 60 months I really don't see this as a bad option. Keep in mind that after the house is built, a home equity loan will be taken to pay the other loans off. Thirdly, it needs to be realized that all this will not be done at once, but in stages as needed. Also I am working and earning a paycheck at the same time, which means I have income coming in every two weeks. My 401k contributions are staying the same. My only debt is my land right now. B Carey pretty much hit the nail on the head in his post. I have 2 good friends that have built their houses as their own GC in the past 5 years. And my uncle built his as his own GC about 10 years ago. I have resources. And to the lady who says double my "seat of the pants" estimate, there is absolutely no way this house would cost $240 a square foot....See MoreQuestions on Process for Owner Builder for single family residence
Comments (34)The numbers don't necessarily look out of line for your price range or location, but only other pros working in that price range and location would know. Allowances are useful as a guide to make selections and keep within total budget. Have the contractor provide references and review each allowance line item in their office across a table. The first allowance on the list is Landscaping $7,000 My questions would be 1. How did you come to that number? 2. can you show me examples of a $7000 job? 3. Can you show me examples of other jobs your clients have done and how much. (BTW, I only have enough landscape allowance in projects today to cover undefined "city trees" and undefined "yard drainage systems" assuming the client will instead hire a landscaper and I would credit) Adjust if necessary. Allowance for pavers is $5760 Allowance for Countertops is $8325 Same questions How were the allowances arrived? DO they include installation or is it only materials. Did you measure and calculate or is this just a job average? etc. You can get through this in 90-120 minutes. You can ask similar questions of their referenced previous clients... were the allowances enough? Where did you exceed? I've done allowances for my entire career, mostly because clients won't pre shop materials but they've usually seen one of my homes. My least amount of overages was $360 for the entire job as client was disciplined and had seen one of my homes. The highest number.... add some zeros, but the client planned that....See Morechad_m
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