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Message
Building a house
Posted on 6/28/15 at 1:28 pm
Posted on 6/28/15 at 1:28 pm
Ok so I'm building a new house and never have done this before. I'm considering gettind bids on the price? I'm not sure how this really works. Also, is it best to do cost plus or lump sum? I understand it is hard to do lump sum because of so many change orders but I've heard cost plus is where the contractor can kill you. Any input is appreciated
8
Posted on 6/28/15 at 2:48 pm to sasquatch69
Do you have plans yet? Financing?
What type of house, spec? Custom?
What type of house, spec? Custom?
Posted on 6/28/15 at 3:44 pm to HamCandy
Plans are being finished today. Yes, I have financing. It's going to be on the river and will have to be built on stilts. About 2,500 square foot heated and cooled and 3,000 including porch
Posted on 6/28/15 at 5:43 pm to sasquatch69
Try to do your homework and price out owner selected items (flooring, counters, cabinets, appliances, eye.) to include as allowances in the bids. Then avoid the temptation to upgrade allowance selections as you proceed. Allowance overcharges can be a budget killer. Some builders will lowball allowances in their bid just to get the job.
A cost plus contract only works if you have total trust in the builder since it's only his integrity and your watchful eyes that will keep him from increasing costs to increase his fees. Likewise, on a firm price contract, the builder can substitute lower grade items to pocket the difference.
Good luck to the next months of stress. It will be worth it in the end, but it will be an up and down ride.
A cost plus contract only works if you have total trust in the builder since it's only his integrity and your watchful eyes that will keep him from increasing costs to increase his fees. Likewise, on a firm price contract, the builder can substitute lower grade items to pocket the difference.
Good luck to the next months of stress. It will be worth it in the end, but it will be an up and down ride.
Posted on 6/28/15 at 6:15 pm to sasquatch69
If you have the time, and you think you're capable, contract it out yourself. If you know good subs, and your house is not out the norm, and your gonna be birdoging it anyway, save the 40 grand and do it yourself. You could pay someone to be a consultant just to know what order to do things.
This post was edited on 6/28/15 at 6:17 pm
Posted on 6/28/15 at 7:28 pm to Rust Cohle
quote:
You could pay someone to be a consultant just to know what order to do things
free advice:
Get your plan together.
Start with the foundation (not the roof)
I started by building my 5 car garage(with upstairs apt complex) so I could be living on the property as I built the house, but not everyone has my patience/planning ability.
Posted on 6/28/15 at 8:34 pm to sasquatch69
Never built a house but a contractor would be licking his chops at cost plus. That is unless you personally know and trust the contractor
Posted on 6/29/15 at 7:24 am to sasquatch69
I wouldn't choose a builder based on price. Pick one based on build quality. Thoroughly inspect previous builds of anyone you consider.
Some will do little things that really matter in the long run like screwing down sub floor instead of nailing, use better insulation methods, etc.
Having said that, if you don't plan on living in the house more than 5-10 years, then just go low bid.
Some will do little things that really matter in the long run like screwing down sub floor instead of nailing, use better insulation methods, etc.
Having said that, if you don't plan on living in the house more than 5-10 years, then just go low bid.
Posted on 6/29/15 at 8:34 am to sasquatch69
Submit house plans to builder and get bid.
I would not do cost plus. It is in the builders incentive to have higher costs. I knew a builder who would have his subs round up to increase his profit.
I would not do cost plus. It is in the builders incentive to have higher costs. I knew a builder who would have his subs round up to increase his profit.
Posted on 6/29/15 at 9:19 am to WPBTiger
Lump sum is the way to go. BUT, you need to have detailed conversations with your builder about exactly what's in that lump sum. A quality custom builder will spec out everything, down to the doorknobs, so you know exactly what you're getting. Be sure you KNOW what sort of quality you want in various materials so those costs can be factored into the estimates. An honest contractor will spend time making sure you understand exactly what you're getting in the price....he should be showing you the allowances for each category. You'll have the room to select the items you desire, as long as you stay within the costs for the overall category...or at least this was my experience with an excellent, honest GC on a true custom, turnkey homebuild.
Posted on 6/29/15 at 2:50 pm to sasquatch69
I just built a house. It's the only house I ever built and didn't know shite about it.
1. You need a plan first but BEFORE you ever pay money for the plan or pay to modify the plan you need to show it to a contractor to determine if it'll cost an arm and a leg to be built because of considerations like the roof being very complicated. Show them the sale page online for the plan. example plan on Madden homes
2. Get bids from multiple contractors. Start doing this ASAP because the conversations will help you sort through learning this stuff.
3. Dealing with sub contractors appears to be a nightmare so I was glad I didn't go the DYI route. Plus the bank told me I'd have to put like 40% down to finance a DYI approach.
For what it's worth I used Passman homes in Baton Rouge. All I knew is how much money I had and what I needed the home to appraise for to avoid PMI. The house appraised well and thus far we love the house. Any issues we've had they've taken care of.
1. You need a plan first but BEFORE you ever pay money for the plan or pay to modify the plan you need to show it to a contractor to determine if it'll cost an arm and a leg to be built because of considerations like the roof being very complicated. Show them the sale page online for the plan. example plan on Madden homes
2. Get bids from multiple contractors. Start doing this ASAP because the conversations will help you sort through learning this stuff.
3. Dealing with sub contractors appears to be a nightmare so I was glad I didn't go the DYI route. Plus the bank told me I'd have to put like 40% down to finance a DYI approach.
For what it's worth I used Passman homes in Baton Rouge. All I knew is how much money I had and what I needed the home to appraise for to avoid PMI. The house appraised well and thus far we love the house. Any issues we've had they've taken care of.
Posted on 6/29/15 at 6:16 pm to sasquatch69
Can you manage people? I don't mean yelling, screaming and cursing out subcontractors. I'am speaking of laying out a schedule that will run for six to eight months, that is fluid and can change daily for any number of reasons. If the answer is yes, than sub it out yourself. We did it and it worked out great for us.
Posted on 6/29/15 at 6:23 pm to TIGER2
Did you finance it? I've heard some banks won't let you self contract
Also I think my hood may require licensed contractor or I'd probably do it myself
Also I think my hood may require licensed contractor or I'd probably do it myself
Posted on 6/29/15 at 6:40 pm to yellowfin
quote:
Did you finance it
Yes, construction loan than Mortgage. This was in 2003, maybe things have changed.
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