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How to Build Your Dream Home |
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How to Build Your Dream Home |
The
following article appeared in the April 1996 issue of
"Custom Home" magazine.
"How To Build Your Dream Home, A Guide for Custom Home Buyers"
by Rich Binsacca
Buying a custom home is like no other purchase. You can't just point to what you want and order it. Instead, you enter a creative process with a team of professionals - builder, architect, suppliers, designers. It's a demanding, sometimes frustrating process, but always exciting. And the payoff for all your effort and money is a house custom tailored to your family's needs, taste, and dreams.
As with any new adventure, the first step is always the most difficult. This guide is designed to make that step a little easier by outlining the various ways you can go about building your dream home.
As you will discover, building a custom home entails hundreds of decisions. After choosing your lot, the most important decision you'll make is choosing who will design and build your house. You have a range of professionals to choose from who can perform these services for you. Your challenge is to select the right team for your project, your personality, and your pocketbook.
The first step is to decide how much involvement in the process you are comfortable with. Are you willing to expend the time and energy shopping show rooms to select everything from floor tiles to switch plates? Or, would you rather select from a few recommended products in each category? Do you want to be in control of all the decisions, or do you want someone on your team who will take charge and make the building process as smooth as possible for you? Are you willing to take on more responsibility and assume risk for the project's outcome in exchange for lower design cost? Keep your answers in mind as you read through these options, and you should find one that suits your style.
Whatever you choose, the majority of professionals agree that your team should be assembled early in the design process to take greatest advantage of each member's expertise. You may even want your design or building pro to help evaluate land you are considering for your new home.
Building a custom home should be one of the most exhilarating experiences you will ever have. A carefully chosen team of professionals you trust, respect, and work well with will go a long way toward assuring that it is.
A licensed architect is qualified by education, experience, and rigorous state examinations to take your home from design concept through the construction process. Most will provide a full range of services, including working with you to create a final design; developing a budget and preliminary estimate; producing working drawings and specifications to be used in bidding and building your home; and on going job supervision once construction begins.
You can expect to pay an architect between eight and fifteen percent of the construction cost to design your house and produce finished working drawings for construction. You'll pay more if you want him or her to oversee the selection of the builder and other team members (for example, landscape architect and interior designer), and then manage the project during the building process.
That fee buys you the services of a professional trained not only to locate the building on your site, arrange the rooms, and shape the exterior, but also to apply the health and safety regulations prescribed by local building codes; understand the zoning restrictions on your lot; engineer heating and cooling systems for maximum comfort and performance; suggest finishes and products that will enhance the aesthetics and livability of your home; and pilot the plans through the approvals and permit processes. "Architects are generalists," says Seattle based architect Peter Greaves. "We...are trained to see the whole picture."
You usually can contract with an architect to perform specific phases of the work. Many people hire an architect to design their house and produce working drawings and specifications, and let the builder supervise construction. Or you might pay a licensed architect to develop the initial concept and some sketches of your house, and then take those drawings to a draftsperson who will create specifications and working drawings for a lower fee. Again, you would rely on the contractor to oversee completion of the project. If you take this route, you will give up some important benefits. For one, you won't have the architect's guidance in determining that the working drawings will yield the house he or she designed for you. A potentially bigger disadvantage is that the architect won't be liable for any errors or omissions in the plans.
Look first for an architect who specializes in custom home design; he or she likely will be more knowledgeable about trends in design and new products. Friends, regional lifestyle magazines, and the local chapter of the American Institute of Architects are good places to start your search. If you see a house you like, ask the owner who designed it.
Once you have narrowed your search to a few names, interview the architects as well as their previous clients and the builders who've worked on their jobs. Ask if the architect stayed within the budget. Did he or she produce clear and correct working drawings? What was the architect like to work with? Did he or she listen carefully to the client? Once you have the answers, listen to your intuition. Do you like and trust the architect? The design process requires a lot of client participation. You'll be working closely with your architect, so choose someone you feel comfortable with.
A building designer is an alternative to an architect. While these pros are not licensed and often are self taught, most focus on residential design and often have an impressive command of construction cost and building products. Building designers generally command lower fees than architects do, and often have strong ties with custom home builders, sometimes working in tandem with them. The local chapter of the American Institute of Building Designers can generate a list for you of recommended members in your geographic area.
Contract with a Design/Build Firm
These firms combine design and building services under one roof, offering you the convenience of one-stop shopping. Some design/build firms work closely with clients during the design phase, much as an architect would. Others offer a selection of plans, products, and finishes that they know are workable and reliable. This takes some of the decision making pressure off the client.
In a typical design/build organization, the company's in-house architect or designer works closely with you and the construction staff to design a house that fits your dreams and budget. In fact, keeping the design within the budget is a strength of design/build firms. As you and the designer identify features and materials you'd like in your home, the construction staff prices them, giving continual feedback on how your decisions will affect the final cost. With an independent architect and the competitive bid process, by contrast, you're not sure until the construction bids are submitted whether the design is within your budget. "The design/build process works like a funnel, progressing from very general ideas to exactly what you want and what it cost before we even get to construction," says design/builder Jeb Breithaupt of Shreveport, La.
Your relationship with a design/build firm likely will start with the builder, who will work you to establish the parameters of your project before introducing you to the designer. In some companies, the builder is also the designer. Other builders may outsource your house to one of several local architects or designers they work with.
As ideas, sketches, and product selections are refined by you and the designer, the contractor will explain how your decisions impact your budget, and will start to prepare for construction. That gives you an opportunity to scale back your plans or choose an alternate material if cost start to run over budget. Once you approve the design, your project can move seamlessly into the construction phase.
Design/build services usually require two separate contracts; one for design and one for construction. Many firms will set a price for design (usually about one to three percent of the overall budget) and then roll it into the construction price - or even waive it - if you hire the company to build the home. Should you decide to cancel the project of "shop the plans" to other builders, the fee is billed to recoup the firm's design expenses.
Other firms always bill for design work whether or not they build the home. Breithaupt, for example, is an architecture graduate and prefers to place more value on his design work. By charging for design regardless of the construction contract, he believes he removes the temptation to rush into the building phase. "With a custom home, it's better to take your time and do it right," he points out.
Thoroughly examine the design/build firms you consider. Talk with as many past clients as you can. Ask if the company was responsive to their questions and concerns. Does the company back its work? Visit recent projects, both completed and under construction. Does the finish work meet your expectations? Do the job sites look clean and well run? Ask to see the company's contractor's license - if it's required in your state - and its insurance certificate. Once you've done your homework, ask yourself which company you trust the most. As you embark on building your home, you'll soon discover that trust is the most important ingredient in the process. "Design/build is not for tire-kickers," Breithaupt says. "It is a relationship based on mutual trust."
An increasing number of mail-order services sell stock house plans. Sold by so called shelter (or home or lifestyle) magazines, as well as through plan books available on the news stand, stock house plans are a fast, easy, and less expensive way to begin the home design process. But be aware that the house you build from these plans won't be a true custom home; that is, it won't be designed for the special conditions of your site or for the unique needs of your family.
However, sensing a growing demand for customization, house plan companies have expanded their stock of plans and make it easier for homeowners to alter designs to their particular needs. Some companies will even help purchasers create a list of changes that they can hire a local designer or draftsman to make.
The major benefit of stock house plans is their low cost. For a fixed price of about $400 for one-time use, home buyers can get serviceable working drawings and a complete materials list for the plan of their choice. Stock plans also save money by leapfrogging the initial design stages - and expenses - required if you start from scratch with a design professional. Using a stock plan will relieve you of some of the decision-making burden since the floor plan and elevations are basically determined for you. But the stock-plan route means you'll have to do a lot of legwork that a design or building pro's guidance would have eliminated. You'll be on your own when it comes to locating, choosing, and ordering scores of products that will go into your home. If you don't like making a lot of decisions, this might not be a good option for you.
But stock house plans are only one component of the design stage. in addition to aesthetic changes in room sizes, finishes, and products, the plans also may need to be altered for practical purposes - to fit on your lot and to meet local building codes and local construction practices. That will add to the cost of the plans.
Traditional bidding is beginning to lose popularity to design/build and negotiated contracts, which are arrangements that bring the builder on board early in the design phase. Still, many people prefer to have several contractors bid on their houses because they think it provides the lowest price. But getting the best value is a bit more complicated than simply selecting the lowest number.
First, you and your design pro typically will narrow the list of potential builders who will bid on your plans to three well qualified candidates based on experience, reputation, and business stability. Only consider the builders who have operated in the same area for a least five years and have experience building new custom homes, ideally of similar size and style to the one you're planning. Before you solicit bids, get to know the builders on the list. Have them take you on a tour of recent projects, submit references, and present themselves and their work so you can gain a broader perspective about their business and practices.
The plans themselves should leave very little to the builder's interpretation, thereby ensuring a fair comparison among the bidders. In fact, the key to successful bidding and smooth construction is removing as much mystery from the plans and specifications as possible. For instance, make sure the specifications detail the precise products, including model number, color, and size you want. Plans that list "or equal" beside a particular item open up a wide range of quality, price, performance, availability, and maintenance interpretations.
Once the bids are in, rely on your design pro to evaluate how a given builder's substitutions influenced the estimate. Sometimes a builder will offer cost-saving suggestions to the plans and specifications or attach supplemental information to the bids to help you better evaluate the estimate. Once again, work with your architect to determine if the builder's suggestions are of equal quality and value to what the plans specify.
Many builders hate the three-bid rule. They'd rather spend their time delivering high quality, satisfaction, and superior customer service than put in long hours preparing a proper bid (for which there is no guaranteed fee, even if they get the job). Bidding on a one-of-a-kind home also is risky for a builder, especially if the house has unusual details and materials. The best builders (those who pay their employees; keep up with proper licensing, insurance, and taxes; and want to make a fair profit) often are high bidders anyway, and therefore are bypassed for a lower estimate. Some builders, in fact, refuse to bid if they feel they're being reduced to a number. "We call it dodging a bullet," says Oakland, Calif. - based custom builder Michael Muscardini of Creative Spaces.
An alternative to the three-bid rule, and often the preferred method of many design pros and contractors for selecting a builder, is the negotiated contract. The process typically begins with the selection of an architect or designer, but the builder joins the team during the design phase. Based on his construction expertise, he is able to offer cost-saving suggestions, opinions on the reliability or availability of materials, and better ways to build the house during design, when it is easy and cheap to alter plans. "The best way to get the best job is to choose a custom builder you like and negotiate with him, "says Catherine B. Scott, a residential designer in Boise, Idaho.
Unlike competitive bidding, a negotiated contract removes price from how a builder is selected. Rather, the contractor is chosen for his or her experience with similar custom home projects, a good working relationship with you and the design professional, references and recommendations from past clients, and a familiarity with working as part of a design team.
A key component of the negotiated contract is a letter of intent between you an the builder that puts a value on his or her work prior to the start of construction. "It's the exact opposite of bidding a set of plans on speculation," says Muscardini. For example, in addition to the cost of construction and prior to ground-breaking, Muscardini bills for his services to deliver to preliminary estimates and a final "bid" based on the plans being developed and refined. His fee for that service is between $1,500 and $2,500, even if the house never gets build.
Once the homeowner approves and signs off on the final design and construction estimate, the architect and builder swap leadership roles. As construction begins, your builder (and/or the lead person on the job site) will be your primary contact about the custom home project.
Your custom home team members have been through the building process many times, and know exactly what their jobs are. If this is your first custom home, however, you may be wondering what your role will be. We asked Carol Smith, Custom Home's customer service columnist and the author of Building Your New Home: An Insider's Guide (published spring 1996 by the National Association of Home Builders) what homeowners can do to make their jobs go smoother. Here are her observations:
Make product selections on schedule. Your architect or builder will probably give you a timetable for selecting products. Many products can hold up work if they're not delivered by a certain construction stage. You can help keep your home on schedule by making selections on time.
Stick with your budget. The "we're only going to do this once, so we might as well have what we want" mindset can quickly bust the bank. If you really want an item that runs over budget, write down the make and model number so that you can buy it later, when you have the money.
Visit the job site regularly. Write down any questions or concerns you have and discuss them with the builder, not the subcontractors, who don't have all the information the builder has.
Maintain realistic expectations. Many things that can delay construction - the weather, late deliveries, delayed approvals - are beyond the builder's control. Remember, he wants to complete the project on time as much as you do.
Refrain from locking in your loan until the builder gives you a delivery date. He can usually tell you when your house will be completed about 45 days out.
Learn about the systems and products in your new house and how to take care of them.
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