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How to Build A Custom Home: A Step-by-Step Guide for Custom Homes

Jeremy Kanler June 5, 2019

A custom home is a dream come true. You should prepare before you break ground. Although an intimidating task, custom home construction does not have to be unsettling.

Part 1: Plan Ahead

Many people exploring custom home building spend a lot of time envisioning their home of the future. As they get closer and closer to making a decision they start feeling stressed with all the ins and outs involved. Utilizing an outlined list will relieve stress by visualizing the preparation work and planning for the future of the project.

Consider the Following:

a. House Lot

If planning to use an existing piece of land then you may have thought about what an optimal layout would be and how to best utilize the natural land around it. If you’re finding a new location for your dream home then choosing your lot should be as important as choosing the design of the house sitting on it.

Assuming you have researched and picked a neighborhood, choosing a lot to build your custom home requires foresight of what the end product will be and how much it will cost to get there. Architects may urge different design concepts based on the parcel the home is sitting on and what benefits the land imposes. Although it is not necessary, having an architect involved while doing site analysis is beneficial for both your mental health and for the opportunities the lot will provide.  

  • Size, surroundings, and distance from neighbors all play a part in what price you will be paying for the lot initially but also consider upkeep and property taxes for the future.
  • House plans for flat building lots are less difficult and less expensive to build, although they are not always as eye-catching as a sloping lot.
  • A sloping lot will allow you to tuck the garage under the house and possibly plan for a daylight basement.
  • Narrow lots tend to produce vertical home designs which limit open floor plans and produce more “cozy” designs.
  • Wider lots allow for open floor plans which promote family togetherness slightly better.
  • Wider lots also offer a cost efficient single floor option whereas most narrow lots force builders to add floors to the design.
  • Scenic sloping lots may encourage wraparound balconies to experience views that were unknown from the ground level.
  • Heavily wooded areas may may call for a specifically angled roof in order to capitalize on sunlight for skylights to bring in natural light to your home or to provide power for renewable energy system to be installed.

The geographical and topographical features of your lot can have a large impact on the style of home plan you will need to choose. Therefore, while choosing a house plan, consider whether your lot space will provide a lawn area for outdoor games and sports or if you will need to reserve enough lot space to include pools, interesting landscaping designs or gardens.

If you’ve already purchased your lot then you will need to consider these factors and tailor the house plan that you choose to meet those needs and requirements.

 

b. Pick something your current home doesn’t have

Consider your current home and the quality of life it provides beyond being a roof over your head. What is your home is currently missing? What features do you like and would like to improve on?

Deciding what you’re currently missing allows you to narrow your search by removing plans that would force you to repeat struggles that you are currently living with. Maybe you just want a larger space. Maybe your lifestyle has changed and you need open spaces instead of smaller rooms to accommodate for that change. Thinking about family hobbies and quality of life improvements can help build a list of additional features that will help an architect functionally design the drafts.

  • Maybe having a larger garage space will allow you to have a bigger workspace to bring your hobbies to the next level.
  • Maybe a large garage is the opposite direction of your goals. Maybe you’d like to sacrifice garage and storage space and opt for a larger patio area to host family events.
  • Will there be enough driveway space as your family grows or parking if you entertain large groups of people? Are your nearby parking areas going to be a foresight of this as well?
  • If you are newly married, do you have plans to start a family? How many children do you plan to have? Is there an adequate number of rooms in your house to accommodate your growing family?
  • Taking your lawn area into consideration for any activities would be another important question to ask. Does it provide adequate space for outdoor games and sports? Maybe a small swimming pool or garden area?

Consider how you plan to use and enjoy both your indoor and outdoor yard space. From this decision, you have a great starting point for your foundational requirements as you look through future plans and will act as the second topic discussed with your architect following budget requirements and mandatories.

 

c. Privacy is an important concern and should be treated as such

Privacy should be split into two categories, internal and external, both should be considered when planning a home.

Internal privacy relates to the layout design of the house and what rooms are accessible for occupants or visitors. A common example of internal privacy in houses is where all the bedrooms are grouped together aside from a guest room or the master bedroom which are located in a more remote area of the house.
  • If you are planning on building a family then master suite privacy may not be as ideal as being right next door to your nursery.
  • Guest bathrooms should not be designed too far away from where entertaining takes place as it is less convenient to reach and allows visitors to see more of the house than you wanted them to.
External privacy is a bit more traditional and what most expect when they hear “home privacy”. Depending on your lot, home design and amenities the “external privacy” list will continue to grow.
  • Fences to fortify the yard, tall trees to blind onlookers from the pool area, shrubs to conceal bathroom windows are just the tip of the external privacy iceberg.
  • Window placement plays a large role when safeguarding your privacy from nearby houses, passerbys, nosey neighbors.
  • If privacy is a major concern then a house plan with an U or L shape should be considered; these types of house plans can provide more privacy inherently based on their structure.

 

d. Furnishings and aesthetics

Will you be using the old furniture from your home, or will your new furniture have an important role to play in the designing of your new living areas? It’s important to carefully consider the seating areas and how furniture placement will affect the overall feel of the room. How will the room aesthetically flow into the other rooms? Both in terms of art and furniture.  

  • Plan for at least 3 feet of space between your furnishings and doors to allow for the dead space or clearance to swing.
  • If considering installing large bookcases or shelves then talk to your architect about options for custom built-in units. Built in wall units and shelving offer a natural look and an organic feel in your rooms.  
  • Think about space. Will the height of your furniture or television block windows? Does it provide enough vertical wall space, areas for personal belongings? Natural light is also usually overlooked when talking about furniture placement. Make sure your planning allows for enough light to enter in the designated areas of your home.

 

Part 2: Prepare your budget

There is a vast range of prices when it comes to building materials, the complexity of design and quality of craftsmanship when considering building a custom home. With homes in Malibu averaging between $400-$500 a square foot for custom builds it is easy to get lost in what is within a budget and what needs to be cut. Estimates also tend to vary from preparation phases to execution phases so it is important to have a flexible budget that plans for unanticipated problems or additional features.

 

Consider the Additional Fees

a. Architectural Design Fees:

Custom homes that have been designed from scratch utilize architects to design and help visualize the project in full before any work has begun. Using a combination of building models, 3d generated drawings and other architect tools a prospecting home builder can conceptualize a vivid representation of their new home and foresee issues before they become too costly to revise.

Additionally, architect’s are the most educated resource while building because of their vast knowledge of zoning laws and local and national building codes as well as traditionally being the lead problem solvers when building issues arise.

Architects charge depending on the size and complexity of the build, sometimes charging hourly, by total square footage or by a percentage of the total cost. Working in a range from 5% – 15% of the entire project costs, architects will initially ask for budget ballparks or limitations then move onto functionalities and mandatories.

An architect’s job is to envision your dream as you describe it. Then they will work within your budget to produce your dream home design while overcoming aesthetic issues and parcel alignments. All the while preparing you for next phase considerations and plannings.

b. Permit Fees

Building permits are mandatory documents homeowners must file for before any construction has started. Opting to bypass one or any amount of permits can lead to immediate hefty fines and sometimes required teardowns of construction. If a homeowner chooses to sell the property in the future without all retroactive permits having been filed correctly then the home valuation will be significantly inaccurate forcing the owner to spend time straightening all the licenses out while being burdened with additional fees.

Homeowners who are planning to take on a new home construction project need to prepare for permit requirements set by local authorities or set by the state to ensure building code compliance. HomeAdvisor states the cost of new construction building permits falls between $400 – $1,800 depending on location and size of the project. If working with an architect firm they will outline timelines for permits and have a realistic cost of permits for you to anticipate.

c. Property Taxes

No matter the city or neighborhood you choose to build your custom home, you are required to pay property taxes. Property taxes are used to pay for public schools, police, fire department, public parks, city & county employees, sanitation, maintenance costs, public projects, health care benefits for employees, retirement benefits for employees, etc. You should look into property taxes paid by neighboring residents with similar homes as the one you are planning on constructing to get a sense of what you may be paying and see if it fits into your future budgets.

 

Part 3: Choosing an Architect

Depending on the size and complexity of your project, a qualified architect may need to be part of your building team. In custom home construction an architect is always an incredibly useful resource. As outlined in an earlier article failing to hire an architect is more often than not an unwise decision.

Architects will act as an extension of your visions while they produce detailed construction documents for the contractors to follow. Finding creative solutions to complex design problems while finding a balance between budget efficiency and building design is no simple task.

  • The earlier architect firms are involved with projects the fewer headaches will come in the future. Some firms will recommend contractors they have had success working with but, if you are planning on finding a contractor yourself then architects can help compare estimates and protect you against unqualified contractors.
  • Contractors may recommend against a heavily involved architect to help stretch your budget, however, in our experience architects help stretch the budget themselves, doing a better job of it, when working on medium to large size projects. Being able to foresee design hurdles and planning around them while keeping structural integrity and design aesthetics in mind will prevent stress while staying within your project timelines.

Similar to finding a general contractor, word of mouth tends to be hit or miss as everyone has the “best in town”.

  • A reference from family, friends or neighbors is worthwhile to meet and discuss your project with but should always be compared with other firms.
  • If you have a contractor you know will be working on the project then their reference is more likely stronger than a neighbor’s reference.
  • Use Google to find local firms and dive into any reviews you can track. Negative reviews don’t mean unqualified architect but, you should mention the review you read while interviewing the firm to get more clarity.
  • Before meeting any architect firms be sure to review their license through the National Council of Architectural Registration Boards and bring up any discrepancies during your first meeting.

Finding an architect should be one of your first priorities – they will make every upcoming phase more manageable and reduce construction risks by providing contractors with code-compliant roadmaps.

 

Part 4: Choosing a General Contractor

When making the decision to hire your general contractor, you have to first understand that your relationship should be based on openness and honesty. It is a very back and forth process that relies on the cooperation of both parties. Comfortability is an important factor in your decision, look for someone you are confident will be a detail-oriented person that places value on integrity and a job well done.  

  • In earning your business, the contractor should also look to be earning your trust.
  • Reputation is very important and should be reflected in the way that individual conducts themselves.
  • If working with an architect firm they will have a list of contractors they have worked with and are worth reaching out to.
  • You want to be able to have a positive experience that you can look back on and be comfortable recommending that individual to others. The best interest of your home should take precedence here first and foremost.
  • You can be creative and head down to your local lumber yard. Often times they are able to recommend a contractor in good standings. Avoid places like Home depot and Lowes as a substitute for a good lumber yard.
  • Cautiously ask friends and family to recommend a good contractor but keep in mind that everyone’s contractor “is the best, you have to use them.” Compare the project your family and friends contracted the builders to work on to your build and if it is at the same level of work and complexity then it should invoke a follow up with the builders themselves.
  • Use the internet to your advantage when prospecting or vetting out contracting companies, but be cautious. Sites like Yelp and Angie’s List are often not viable options for references as good ratings tends to be tied to a payment scale from the contractor. Their motives are often ulterior at best.

Don’t always go with the lowest bid. Especially if that quote is much lower than the competitor’s prices. Keep in mind, there will always be a reason for lower costs although there does not have to be a reason for higher costs. The same applies on your end. Don’t lowball the contractor. Nobody is going to laugh at your price and any price should be met with proper negotiation.

With this being said, if getting the best deal possible is of high value to you then be careful about what perspective you choose to take. You want to have a price in mind that is both respectful to your needs and to that of the scope of the work.

Seemingly, the term “you always get what you pay for” tends to apply well here, but you still need to keep your wits about you. That is the importance of a thorough document outlining the scope of the project entirely.

  • When you are comparing quotes, you are comparing similar overviews of the larger picture. It is important to stay focused on finding the best value here, not necessarily the lowest price.
  • The quote given you, is not really negotiable. If that is the quote given, then you have to take that at face value. Be cautious if the contractor is willing to change the price without changing the scope. Their initial quote should be formulaic and there should be no way of reducing the cost without having to compromise on  or exclude something.
  • Remember that if the quote is in fact much lower than competitors, try and figure out why or ask your architect for their perspective. Maybe the contractors unknowingly left out some arbitrary materials that they would otherwise add down the line.
  • If the price is not satisfactory to you, changes can be made to the scope of work or less costly materials will be substituted to bring the price down. If this is still not satisfactory you are welcome to seek out other quotes from builders.

A good contractor will be seeking to balance quality and price. Be mindful of contractors that over promise. You may continually ask for them to include services or additional scope to the project while remaining at the same estimate if they continue to agree to add ons then that should be a red flag. In a previous article we wrote “Finding a good contractor that will take the time to do things the right way will always pay off in the long run.” and we stand by that statement.

 

A {modern / unified}  approach to project delivery – Design-Build Contractors

Often when prospecting homebuilders are beginning to formalize their approach to a new custom home build, they begin to debate a design-build versus an architect-bid-build approach. Traditional and siloed efforts from architect firms and construction companies often leave many details miscommunicated and unoptimized.

Architects have their design in mind and are often less connected to what actual costs limitations are regarding building process, materials used or even design style recommended. Builders are much more budget considerate but will lack the experience of translating a homeowners vision to a formalized plan while anticipating possible speed bumps. The miscommunication between architects and builders is a significant reason why the design-build project delivery method was created and continues to trend upward for new custom home projects.

Using their engineering experience to guide the build and manage the construction process, a Design-Build team is a modern solution for custom home prospectors.

  • The benefit behind the design-build method is that it encourages collaboration across all entities working through the same project.
  • Design-builders will enter into a single contract with the client and will take all responsibility through the design and construction process mitigating risk away from the homeowner.

Intended to be intensely cohesive and fully integrated – the design-build method aims to deliver projects more time and cost effectively than other building methods can.

  • Design-build saves time because the design-build team is fully integrated with the project delivery team from inception to completion.
  • The design-build team works with the owner on important decisions such as design performance and cost throughout the project while coordinating various construction elements to ensure faster delivery of the project.
  • Significantly reduced fast tracking allows all design phases to be overlapped and additional time efficiencies from pre-construction can be correlated to the fact that different contractors do not need to receive any prints, formulate their bid and revise any plans.
  • Cost savings come from the design-build team having access and insights to the most up to date construction costs while they create their price proposals and because they are working as a unified entity removing risks of miscommunications.
  • The budget of the project is established early in the design process and both designer and builder work collaboratively to ensure the entirety of the scope of the project is included. Because all costs are identified early, the customer is able to make informed decisions that may change the project before any work starts.

The benefits of the single contract agreement while using the design-build method are tremendous during both the design and building phases. With all other project delivery methods, the homeowner acts as a middleman and bottleneck between designers and builders. Forcing involvement from the homeowner on designer and builder disputes not only creates stress but also slows down the project and can lead to added costs that no entity is willing to accept responsibility for. The design-build method removes the middleman role of the homeowner by entering the single contract agreement, design-builders take full responsibility and remove all liabilities from the homeowner.

 

Making the decision & managing the building process

Kanler cannot stress the importance of vetting your contractor but please make sure the contractor you are using is licensed, insured and bonded. Make sure to check with the Contractors State License Board to see if the contractor in question has any claims against their bond or has been penalized for any reason.

The contractors current standing with the board is highly relevant. If the contractor has been penalized then you should plan a conversation with the contractor about that specific penalization and go as far as contacting the homeowner who was involved.

If you hire an unlicensed contractor and something goes wrong, you will have little legal recourse in case anything goes wrong. Aside from there being a very small chance you end up with what the contractor promised, hiring an unqualified contractor will drastically hurt the value of your home down the line if ever discovered.

Workplace accidents happen from time to time. This is where a good insurance comes into play. What happens if someone were to be injured on the job? Will your insurance company pay for his medical bills, his time off work, and any disability awards?

  • Make sure there your general contractor has workman’s compensation insurance and general liability. You cannot afford to do business with a tradesperson without insurance.
  • Make sure to make copies of both insurances for your records before building starts.
  • If the contractor is filing for permits themselves then be sure to double check with your town for clearance and approvals. You do not want to run the risks of skipping the permit process.
  • Municipalities can and will levy fines or force someone to remove a structure that was built too close to a property line, or wasn’t done under permit. Not to mention, if a home inspector finds out down the line, when you decide to sell your home, that things were not properly permitted, you run the risk of lowering the value of your entire home.

Contractor should also always have a written contract drawn up. They should dictate the terms of behavior for both parties. This should usually include the following:

  • Scope of work describing the location where the work takes place detailing what is included / not included in the contract in regards to work completed. This may also detail specifics of how the work is to be completed. With remodeling, often their may be a clause regarding making repairs (there will be surprises in remodeling) that were not covered in the original quote.
  • Time and materials. A good materials sheet should  describe the material selections in detail, as well as any data sheets for selected materials, warranty info on the materials, and so on..
  • Warranty information on the work finished and materials supplied. You should not be on the hook for damage to material on the job site or during transportation.
  • Payment schedule and change order information. Be mindful of the language here as many low-quality contractors will see a mistake in the initial scope of work and plan to capitalize on a change order request. Working with an architect should unburden this task.
  • Completion schedule for the contracted job.  
  • Boilerplate legal info describing arbitration terms and penalties for late payment as such.

Make your payments on time and in full. Keep your lines of communication open, visit the job site often enough, but not to the point where you are hovering. Let the contractors take care of what they are responsible for but ask questions when things look foreign or out of place. This is why the trust between the two parties must have a strong foundation.

 

Timeframe

Depending on the complexity of the design, demand for building materials, building construction companies availabilities and your budget a timeline for your custom home development could vary tremendously. The United States Census Bureau indicates the average number of months from start to completion of custom home construction ranging from 7 to 13 months.

Taking all your scheduling needs into consideration before reaching out to an architect firm is best practice in order for the architects to manage your expectations and to develop a plan of action that will fit within your timeframe.

 

Once a design is approved and an architect firm is selected they will build a timeline outlining:

 

  • Permit acquisition and information gathering: 15  – 40 days.
  • Builder prospecting, estimations and negotiations: 15 – 30 days.
  • Groundbreaking – Demolition of existing structures and foundation pouring: 15 – 30 days depending on seasons.
  • Framing – the skeleton of the house: 15 – 45 days depending on size and complexity.
  • Mechanicals and utilities: 20 – 60 days depending on size and complexity. Often times sections of the build will be focused amongst all trades in order to start “closing” walls while the next section is moved onto.
  • Closing walls – insulation and drywalling: 14 – 28 days. Depending on what kind of insulation is used I.e. spray foam insulation, insulation batts, loose fill insulation, etc. These trades tend to move extremely quickly and are often in and out of a project within a few weeks time. When walls and ceilings are insulated and drywall is installed it often acts as a middle point to the construction and begins the “finishing” stage of the build.
  • Interior finishing work: 25 – 60 days. Often when a homeowner feels the chaos is behind them as they can walk through completed rooms and feel like they’re in the house that will soon be their home. Finishing phase consists of flooring, baseboarding, molding, painting, and utility finish work as well as custom carpentry features being installed. Floors will be added in a sequence to allow all relevant trades to complete their finish work. Once a floor is installed carpenters quickly move onto baseboards and molding installations in order to allow painters to start their run. When the paint drys, HVAC, plumbing and electric trades will proceed to close out the room by installing their grates, fixtures, covers, etc.
  • Facade work: 15 – 25 days depending on size, complexity and finish material chosen I.e. stucco, brick, siding, etc.
  • Appliance installation: 7 – 15 days. Appliances are brought on site during the final push to finish the interior. Electricians, plumbers and hvac technicians will work extremely mindfully to not damage the interior while they hook up all of the new appliances.
  • Exterior finishing work: 7 – 15 days. Depending on size of the property, complexity, and volume of work included. This will include all landscaping improvements to the property and trade finish work such as lighting and plumbing fixtures, garage door installations (often last as the garage acts as storage for subcontractors),  etc.
  • Final inspections: 7 days. Although there will be inspections throughout the project (electrical, structural, etc.) the final inspection will determine if all the i’s are dotted and t’s crossed. Upon passing the inspection the building-code official will issue a certificate of occupancy which indicates there are no errors and code violations in the structure and deems it habitable.

Upon final inspection and approval, all outstanding subcontractor invoices are paid in full and the home of your dreams becomes the home of your reality.

 

Completing your Home Project

Cleaning up

Usually outlined in your written contract, the building company tends to take the responsibility of final cleanup. Final cleanup should include all dumpster pickups costs and damage obtained during dumpster removals. This will not include planting new grass to replace grass that was damaged during construction but should include removal of remaining earth disturbed during excavations. It is best practice to also hire a cleaning company prior to your move in to take care of remaining fine dust which is important for your health as well as longevity of your HVAC system.

Landscaping

You want to make sure the outside of your home now reflects the beauty inside. There a few sites and places to look for inspiration and planning. There’s a nifty app called Thumbtack that is a good resource. You describe your project and the contractors will contact you. You can then Google that contractor and look for reviews, before/after photos, completed projects, references, etc. There is also the  usual websites such as Houzz.com and Homeadvisor.com.

Whether based on budgets or waiting to see the end product before adding accessories to it, customers will often wait for construction to be completed before considering landscaping solutions.

Moving

Proper moving accommodations into your home should be made ahead of time. Figuring out the logistics between transportation and moving is not something that should be overlooked. If moving across the country then costs will be high and should be considered when the budget is being allocated. Some customers choose to move out of their current dwelling in phases while construction on their new home continues. Placing a storage container on the new property and adding to it as it is convenient is a good option and should be considered.

Interior Design

If interior designers or decorators are involved then they will be in and out of the new home very early in the build. If they are a big part of the project they will work with the architect during design inception and make suggestions to your architect based on their vision. Flooring, painting, landscaping, material choices and almost every other nuance of custom home construction can be influenced by an interior designer so it is very useful to have your architect recommend an interior design group they have worked with and have a good cadence within the past.

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