OSB as in Oriented Strand Board ?

An 8x4 sheet (32 sqft) costs 32 * $13 = $416 ?!?!?!?!

19/32" 8x4 OSB costs about $20 here in Dallas, or some 62 cents per sq ft.

I just bought concrete for $75/cubic yard.

mad.....that's totally BS your GC is saying. Yes, OSB has gone up ..some....concrete not so much. Where are you in the country? Did he give you any detail pricing before this bid? Have him put in writing where this $120 grand extra came from. Here is what OSB is selling at HD. Last year the price was in the $5.50 range.

http://www.homedepot.com/webapp/wcs/stores/servlet/Search?keyword=osb&langId=-1&storeId=10051&catalogId=10053

I paid $75 a yard for concrete last year so I feel like that is pretty stable.

Around 1st quarter of last year was the bottom on the building market and on materials. So I'm sure prices are up. I think lumber, copper etc is probably up 30%. We built in that time and the feeling was lumber was so cheap as to be unsustainable - meaning that it was a money losing sale for all involved. But they had to get rid of inventory and get some cash flow. It is a bit like oil at $30 a barrel - not sustainable. Remember the price of oil was about that in that time period and it is the $70-80 range now. Lots of things are tied to the price of oil and other commodities move in similar patterns.

A caveat about HD - their price changes probably won't be as extreme as the wholesale market. They just accept a lower profit or sell at a loss when they have to. They have to sell to average joe and he won't accept certain price increases. Joe is also happy to pay $5.50 for OSB when it really could have been $3.00. Not a huge effect, but a big chain will moderate the price swings.

If it makes you feel better, our appraisal was 10% under our build+land cost even last year.

Concrete pricing is regional. It has been over $100 per yard in this relatively low cost of living area for more than a year. It is a huge driver in constructions costs around here.

I really don't understand who the "shocked" builder is. Is he the same one who submitted the bid. How can he be shocked? Is he also your "architect/designer/builder?"

Please clarify.

This happened to me this time last year. We had been clear that our budget was $400K tops and then when they sat us down to go over the bid it was $537K! I literally felt sick to my stomach. The architect all along had known about the budget but acted like he couldn't be expected to know what anything cost, and gave us some BS about materials, but materials price rises don't add that much. Bottom line is they don't concern themselves with your budget and hope that you are so in love with your design that you'll just pay for it. We had about three weeks of sleepless nights, and then decided to simplify and shrink our design. Architect was not happy, but too bad. It's our house and we are now so thankful - the new design is more "us" and fits our vision, not the architect's.

Anyway - I've been there. Hugs to you.

Yea the builder we have been working with is also the architect. He submitted out to his subs for bids and went over the results with us. Because of the high bids he received he lowered his fee from 20% to 15% to help ease the blow. We are in Indiana. He's mentioned that he is ok with refining the plans or redraw new plans. He said he wants to ensure we're happy and we've asked him to redraw a 2 story instead of a 2500 Sqft ranch to reduce the foot print. I plan on bidding with another GC as well, but am worried he might low ball and then inform us of incrased material prices while we're in the build, which would be bad for us, because we would be committed to the design at that point and have to pay.
THis is our first build through this process and I don't know if I should be trusting this GC or who to trust. Thanks for all the comments thus far and I do appreciate the time you take to write comments. Keep them coming.

If he is calling himself an architect, he should have professional credentials to back that up. If it is a one man operation doing design and build, I would want to know what his credentials are for both designing and building.

In some areas, you will find builders who will design a home for you. However, they are primarily builders, not designers, and you get a home that the builder knows how to build, not necessarily the home that you want or one that is livable or aesthetically pleasing.

There are also genuine design/build firms, but these have expertise in both design and build. They are usually more than a single person operation.

Our GC used to say that in his line of business there are 2 types of contractors. The ones who give you an attractive price in order to get business and the ones who give you the real price. The trick is to find the one who gives you the real price. I would suggest you try and get a referral from someone who has recently built a house. Ask them if the price for the build was close to the estimates they were given. Talking to actual customers that have gone through the process and had a good experience with their builder should ensure that you are going to not have big surprises at the end of the build. The price difference that your GC suggested above is not to be believed. The house is not big enough to account for such a jump in price in my opinion. You need to do some more leg work and at get at least a couple of estimates. Even rough estimates will give you an idea of whether you are in the same ballpark as the person you are dealing with. In this economic climate I am sure you will be able to find someone that will at least take a look at it. Then you will at least know whether you are being ripped off or not. Your inexperience with this process coupled with the fact that your GC/Architect has so much to gain by that inexperience means that you need a second opinion. It looks like you are going to do that by getting another price. But even so...get references...nothing compares to getting references from satisfied customers.

There's a third type, the builder who will give you a low price and a house to match.

I do know that OSB doubled in the time we got our materials takeoffs (March) and the time we ordered it (May).

A lot of prices were depressed when the building industry was at rock bottom, and there was some consolidation in the building materials industry, with accompanying plant closings.

Now the the building industry has rebounded somewhat, along with the economies of China and India, demand has increased and building materials have gone up. The earlier plant closings haven't helped. There is now less manufacturing capacity for some products, resulting in another driver for higher prices.

I dont know where you're building, but if you're doing any type of true custom build, you're gonna be in the $150+ or +++ range per square foot unless you self GC and scrimp and save like it's your only job. If your house is on the small side for a custom, say 2500 square feet, then you're only at around $144 per square foot, which is pretty low in price for a true custom build. That pricing cannot have been a shock to your builder, but it may be a shock to you.

If you do a fixed price contract for the build, you needn't worry about material cost increases during the build. That's the bidders problem.

I also noticed the quick jump in OSB prices. From $7 a sheet to close to $13 in a few months. I think the earthquakes all around the world have been partly to blame. Lots of demand for OSB and plywood in quick rebuild efforts.

We've built a few homes in the past and are getting ready to build our last (our "forever" home). Get a few bids, and it wouldn't hurt to price out a materials only cost for your plan. You may be shocked at how one person will come in at a bid where they should, and how inflated someone else comes in at because they assume they can get away with it. Do your homework.

Many architects have no clue, and/or do not care about the cost to the person who is actually paying for the house. Because of this, we are drafting our own plan this time.

You may be able to shrink your square footage and still get plenty of house. I've gone from designing a 2400 square foot house down to just under 1800 square feet. By making better use of the space and not wasting it on convoluted hallways and too many doorways, I actually have more usable space. The 2400 square feet was the architect's mess. Every 100 square feet saved shaves a ton of costs off your home, both with building costs, as well as future utility costs and taxes.

We had also considered shrinking the main story footprint and building a home with a loft (we're doing a log home), but I've since decided I did not want to try and keep huge vaults cobweb free again, and people we have talked with have heating and cooling costs roughly double a single story home with the same square footage, even with decent insulation. (Think all that volume of airspace above your floor, and it's space not being used by you). I think gentle vaults are much cozier. We recently had a converstaion with a house designer, and he said don't let anyone fool you. Lofts and two stories highly complicate the build process. Think roof trusses, stairs, extra wall materials. It isn't cheap. Also, a single story exterior is much easier to maintain than dragging out huge ladders.

Take some time and consider actually doing work within, and outside your home. Eliminate as much maintainance as possible. Sometimes we think we need large homes. Think of the extra housework. Have more fun, instead.

We've been pricing materials, and yes, while the prices have risen some, my feeling is that your new pricing sounds out of line. They haven't gone up THAT much. One place actually quoted almost double what everyone else had, for the same materials. My husband and I are acting as owner/builder. We just built a wonderful barn for 1/3 of what contractors were quoting. We sought out local trades people to help with the tough stuff, and they did an excellent job. It was absolutely no stress. We hired a builder with our last house. I was looking for cyanide pills. (Kidding...).

Again, do your homework. There's a lot of sharks out there.

Right now timber is selling for about $350 / thousand board feet for pine in Califonia. Doug fir is about $400 / thousand. Thats up from $250 per thousand. So lumber is going to follow that. Many mills have gone bankrupt or temporarily closed so supply has gone down, and prices are going up. I don't see anything that is going to drive prices back down, but then again I am not going to bet on markets, who knows. I don't need flooring until November, I bought my material today.