Builder underestimated permit/impact fees
Angela Smith
6 years ago
Featured Answer
Sort by:Oldest
Comments (9)
cpartist
6 years agoAngela Smith
6 years agoRelated Discussions
Builders, pricing, contracts - what do you all think?
Comments (28)Mightyanvil, Thank you for the contract breakdowns, I really appreciate that. That is definately part of what I was looking for, ways to create a win/win for us and our eventual builder. We have someone we are interested in using but have not talked specific contracts yet. There seems to be some perception that 1. I am not interested in quality and 2. that I don't realize the potential costs of quality and the unforseen. I appreciate that you are trying to warn me -thanks. I do understand these things and am trying to be prepared for them. What I was trying to get at is that somewhere out there there is a good contractor who will look at a project and take into account our site, our materials choices, our plan, etc. and come up with a bid or projected budget and a price to build our home based on all those things plus whatever he/she needs to make it work, do the job and continue to run a business successfully. Fine with that. There is also someone out there who will do all the same things and will take opportunities to increase the profit he/she takes from the job without offering any additional quality or service to the owners. My whole point is that from my point of view the second scenario is not okay with me and I was wondering what others had done and how they felt about their experiences. I would like to guard against scenario #2 if I possibly can. I know if I choose more expensive materials I will also have to increase the labor portion because it will take more skill from the tradesperson required to do the job. We do want a well built home and know that we will have to make choices and potentially sacrifices to get the things that matter most to us. When I was projecting our budget I took the averages from about 5 different sources of information and then depending on my ability to verify how that would apply to the home we are building I would either use the highest number if I didn't know or the amount that seemed to fit best with our project. There were some items that I was able to verify by actually going out and getting real numbers others by saying 'we are building a home next year it will be (description)if I am looking for 'x' and I budget 'y' is that reasonable? In the 'unknown' areas I spoke to a friend who owns his own concrete flatwork company, he has built several of his own homes. One of his sites was in our neighborhood and similar to ours, so in my basic labor and materials budget I took the amount he paid for excavation and tripled it for safety. I compared that to the prices others have paid in 'hairy situations' and my number was always the highest. We have already dug some on the property as we put in the septic and the excavator at that time did not feel we would have a problem *from what he could see and had experienced on our site* digging the hole for the house. I took the highest foundation cost and added 50%. We have city water, septic is in and we have electrical ready to go. This home will replace a manufactured home so our permits are inexpensive-about 1/3 of what it would be otherwise. When I got my budget together I looked at the overall total and added 10% to the entire thing. I did find that some numbers varied more than others and were harder to pin down. Other times the same number kept popping up so I felt I must be close and the 10% on top of that should cover it. I actually showed this budget and the plan to the builder we are considering and she gave me the feedback that most of my numbers are 'conservative'- in her terms which meant 'high' and we should be fine. Even if our budget goes over another 10% from that we are ok -including the fee amounts she quoted us for her services. At the time the plan we had been considering was built as a spec house nearby and we had gone through it several times. When I contacted the builder I explained that we really liked his house and were considering building that home ourselves. We shared with him information about our property and our time frame and we talked about the finishes in the house and the different things he was including. When he gave me the price for the home as built but on our site it was about 16% higher than our highest number and it did not include everything. Based on comments some have made, maybe it was still a 'fair' number but then again maybe not...in our county you can look up valuations on permits and the price he quoted for house only was $100k over that amount and it was $200k over what he told the county his cost was. In talking with my concrete contractor friend who has built his own homes he told me that builders usually underestimate their expenses for the county but that the county gets very close and they include approximately a 10% 'contractor markup' in their valuation. Enter builder #3, nice guy, only builds turnkey, fixed price. Not sure why he was interested in us as we were very up front that we did not think we would go that way. He was trying to convince us why we should I think. He was very helpful and actually wanted to see our site. He has just finished carving half a hillside out for a huge custom home which we toured so he knows about 'hairy excavation' and he looked at our site and said it was about average for our area and he didn't see a problem. Famous last words I know... anyway he ballparked a price about 10% less than the higher guy and about 9% above our 'cost plus' budget. This makes sense as he does need that 'coverage' in there, but...we had already added that to our numbers so...either we are still way off or...make of it all what you will. The highest number is out of our budget, the middle number is doable and the low number means new furniture, nice landscape etc. Guess which one I am planning on? Guess which one I am HOPING for?! :) So perhaps some will say this all bears no relevance to an actual project and maybe it doesn't. I am not trying to control every aspect, just educate myself and be prepard so that hopefully we make a good choice when we do finally sign that contract. I just wanted to know what everyone else was thinking about builders, pricing and contracts and how to best go about building a home for a 'fair' price. We are committed to building a house, it will be interesting to see what it will actually cost. Thanks all....See MoreWhere to begin, owner-builder?!
Comments (13)I would try to find the land first. The right piece of property was our biggest priority, and we kissed a lot of toads before we found our prince. You should have the property before you design, as the lay of the land can have a huge impact on the appropriate design. The longer you can study the land before siting the house and finalizing the design, the better. I recommend a lot of research before you buy. Many parcels have restrictions, or may have issues such as flood zones and other topographical issues. DO NOT let anyone tell you that such-and-such 'isn't a problem'. Do your own due diligence! Only the local building authority can advise you on building fees, what's required in the way of plans, and who can act as the GC, or do other work. In our part of SC, the permit was only $400. I have a friend in New England who paid $66,000 because of required variances and wetlands encroachment. We didn't even have to submit plans when we pulled our permit. The plans are turned in after completion, and can be basic pencil sketches. Other locations may require numerous copies of professional plans, and engineering stamps. Lastly, I was able to do all of my own work here, the only rule being that I can't sell the house for two years after completion. They'll also tell you what building codes you'll be required to follow. Again, this can have a huge impact on cost. All that being said, you'll then have to find out what the bank will let you do. I did most of my own work, and paid for everything out of pocket, so I have no experience dealing with banks. If I were the bank, I would want a licensed GC in charge, licensed subs doing all of the work, and would want everything to be new, and approved by the GC. You have to remember it is really their asset, not yours until it is paid off. You probably need to have an exploratory meeting with the bank first, and explain what you want to do. If they toss you out, try as many banks as you can. If you can't get the funding, everything else is moot....See More"fees"
Comments (12)As you can see from the previous postings, there are all sorts of fees and expenses. There are no "general" rules of thumb unfortunately. These vary wildly (really!) from one jurisdiction to another. One has to begin by visiting the applicable local building department or agency(s) to find out what their requirements and fees may be. In addition, they may require a range of professional services and reports in order to obtain a building permit and/or an occupancy permit--professional services and reports (and expenses) furnished by others such as engineers, architects, civil engineers, surveyors, testing agencies, etc., in addition to building department or agency regulatory fees and expenses. There may be zoning and architectural review submittals, hearings and fees. In addition, there may also be a wide range of required programs and fees by the lending institution ranging from title company services and fees to flood insurance expenses. Property taxes will have to be calculated and paid. Then there are real estate fees, home inspection fees, cable and internet fees, etc. It pays to really do one's due diligence, especially if budgets are tight. Good luck on your project!...See MoreArchitect custom -> Builder Custom -> Semi Custom -> Tract
Comments (58)The question is...does it matter? I think it does, because words matter. We throw around words on this board constantly when we really mean other things, and I too am guilty of this. Custom really doesn't mean custom when used on this board, it means architect. So someone who maybe isn't experienced on this board may see the word "custom" and think they designed their house from the ground up, therefore it is very custom. When most posters really mean the house needs someone with professional design experience and some measure of talent to guide you through the design process or actually design the home. ----------- Also a better understanding of the differentiation can lead to better advice. In the area I was born in (an area that I still own land in), the major tract builder can build a 4,000 square foot house for under $280,000. If you can't differentiate between a tract and production builder, it is hard to understand how that is possible. ----------- Finally, I am not sure this board does a great job these days of helping people build a home. I might be alone in this, but I would prefer a well built, poorly designed home over a poorly built, well designed home. We focus so much on the design process and the freedom you have to make selections that we sometimes miss the real tragedy of production and tract builders, the shortcuts they take in construction in order to deliver those appealing prices. While I agree custom homes are better than semi-custom and semi-custom is better than production, etc., the real quality cutoff for me is control of the how the walls are built rather than where they are built. For me this is the biggest draw for an architect and the thing rarely touched on, but may actually pay dividends far into the future that make architects not only affordable, but profitable for those value conscious consumers. Again, this is just my opinion....See Morebry911
6 years agonycefarm
6 years agoVirgil Carter Fine Art
6 years agoLaurie Schrader
6 years agolast modified: 6 years agorockybird
6 years agoSunnysmom
6 years ago
Related Stories
CONTRACTOR TIPSBuilding Permits: When a Permit Is Required and When It's Not
In this article, the first in a series exploring permit processes and requirements, learn why and when you might need one
Full StoryREMODELING GUIDESContractor Fees, Demystified
Learn what a contractor’s markups cover — and why they’re worth it
Full StoryCONTRACTOR TIPSBuilding Permits: The Submittal Process
In part 2 of our series examining the building permit process, learn what to do and expect as you seek approval for your project
Full StoryARCHITECTURE7 Builder Upgrades to Skip in a New Home
Consider taking a pass on these options. You’ll increase your choices by doing them later
Full StoryREMODELING GUIDES10 Tips for Choosing and Working With a Builder
Make your construction experience a happy one by following these steps
Full StoryCONTRACTOR TIPS5 of the Most Common Delays in Remodeling Projects
It’s not just the weather — although that’s often part of it. There can be permit delays, scheduling issues and more
Full StoryWORKING WITH PROSHow Much Does It Cost to Hire an Interior Designer?
Interior designers may charge hourly rates, flat fees, cost-plus or a combination. Here’s what that means for you
Full StoryHOUZZ TVSee an Eco-Friendly Backyard Cottage in 700 Square Feet
In this video, watch how a green builder helps a Seattle couple create an energy-efficient home inspired by Houzz photos
Full StoryREMODELING GUIDES10 Features That May Be Missing From Your Plan
Pay attention to the details on these items to get exactly what you want while staying within budget
Full StoryGREAT HOME PROJECTS25 Great Home Projects and What They Cost
Get the closet of your dreams, add a secret doorway and more. Learn the ins and outs of projects that will make your home better
Full Story
Virgil Carter Fine Art