| Home building costs can often be a challenge to | | | | * Make sure language is included to reflect that all |
| control when you've got so many variables in the | | | | building permits will be obtained by your contractor. |
| building or remodeling project. You can avoid | | | | * Make sure language is included in the contract that |
| overages or, at least, keep them at a minimum if you | | | | requires the contractor to be responsible for all costs |
| are armed with some valuable advice. | | | | associated with removal of demolition performed in |
| When planning your build, pad your budget with a 15 | | | | the project. |
| percent Contingency Fund. This fund will enable you | | | | Before Work Begins - |
| to pay for overages you have no control over, like | | | | * If the contractor you use is reputable, he should |
| unknowns behind walls and ceilings and problems | | | | obtain the appropriate permits with local authorities. |
| found once excavation commences. | | | | * Don't let the project proceed until you know that |
| You may not be able to avoid all of them, but you | | | | all permits have been obtained and are posted where |
| can certainly keep overages under a certain amount | | | | required. |
| of control if you consider the following tips and tricks. | | | | Contractor Change Orders - Beware |
| Home Size, Style and Shape - | | | | * This is the primary reason that projects experience |
| If you are building your dream home, these are three | | | | overruns. |
| of the most significant factors that contribute to | | | | * A change order typically increases the cost of your |
| your bottom line - size, style and shape. | | | | build. If you agree to the change order and the |
| * As a rule, size your home in increments of two | | | | associated expense, you are responsible to pay for it. |
| feet in order to reduce wasted material. In addition, | | | | * If the change order is an expense incurred due to |
| industry experts advise that your home be built no | | | | the contractor creating it, then you should not agree |
| deeper than 32 feet in order to eliminate the need | | | | nor should you be held responsible for the cost - i.e., |
| for custom-made trusses. This will also reduce your | | | | contractor accidentally tears down a wall not in the |
| expenses. | | | | original bid or causes damage to your property while |
| * Typically, the cost to build a multi-story home is | | | | working the project. |
| less than building a ranch home with equivalent square | | | | * Be aware of your contract and the condition of |
| footage. Multi-level homes have smaller roofs and | | | | your project along the way, so that you will |
| foundations, and plumbing and ventilation are built | | | | immediately notice issues that come up for which the |
| more compact. Roofs and foundations can be quite | | | | contractor should be responsible. |
| expensive when building a ranch with equal square | | | | * Keep in mind that some change orders may require |
| footage. | | | | local officials to revisit the project to approve |
| * The cost and need for labor and materials will | | | | modifications. |
| increase the more corners and angles you build into | | | | Most Common Milestones for Overruns |
| the home, so you'll want to consider the shape when | | | | Historically, there are two most common milestones |
| building your initial plan. A square or rectangular home | | | | when your building project will experience an overrun |
| costs less to build than homes with others shapes - | | | | if building a new home or adding on a new room to |
| e.g. L-shaped, round, octagonal, etc. | | | | your existing home. |
| Before You Begin - Plan | | | | Beginning of Project - |
| * Plan your buildings costs. Take time to put your | | | | * When excavating and installing a well, if necessary, |
| plan on paper. | | | | overruns are often experienced due to the terrain. |
| * Itemize every activity you think will be involved in | | | | * If your contractor hits unusually rocky ground, it will |
| the project and every product you think you'll have | | | | take longer for him to excavate and will cost you |
| to purchase to complete it. | | | | more out-of-pocket. |
| * Visit home improvement stores and obtain pricing | | | | * If drilling a well, it is not always known how deep it |
| for all items you believe you'll need. | | | | will be necessary to dig before finding water. |
| * Add all your projected expenses up and include the | | | | End of Project - |
| total in your budget. | | | | * Wrapping up the final touches to your countertops, |
| Before You Sign - Specify | | | | cabinets, lighting, plumbing, flooring, electrical and |
| * Make sure you have an architectural plan or very | | | | other aspects to the project. |
| specific drawing and measurements of your new build | | | | * Again, take time to shop around for all these items, |
| to eliminate as much gray area as possible. | | | | price them, include them in the cost for your project, |
| * If you want specific products to be used in the | | | | and deviate as little as possible. |
| build, state your requirements to the contractor and | | | | * If you have excess from your Contingency Fund, |
| make sure that they are included in the contract for | | | | you can always tap into it for extras at the end. |
| bid before signing. | | | | It's almost impossible to avert all overages in a |
| * If you expect granite countertops, but only state | | | | building project; however, if you plan up front and |
| high-end countertops, you can't expect your | | | | keep your eyes open along the way, you could |
| contractor to accommodate your request. You must | | | | reduce and eliminate the most costly ones. |
| be specific. | | | | |