In a prior column we discussed alternatives to the “start from scratch” design / build custom home. If those other options do not work for you then you are faced with the task of creating your own, personal, unique custom home. That is the path that we embarked on when we found a lot in the spring of 1999. A full twelve months later our home was finally completed and during that year we learned a great deal about the custom home building process.

Obviously the two most important things for you will be the location and your ideas for appearance, floor plan and features. You have toured many homes, studied numerous design books and have copious notes and ideas and now you must find the lot or location for your dream home.

In this market, this can be difficult to do. Most subdivisions have builder or other restrictions that might limit your options. You will probably have more flexibility with country acreage but this creates another set of problems. You may find that a Realtor will be helpful in the search for the ideal location for your home. Once you have found the location you will need plans. This could involve finding and purchasing a set of ‘canned’ plans from one of the many design books but these will normally have to be revised and redrawn prior to construction. Another alternative is to use an architect to blend the style, location and appearance together with a floor plan designed to best incorporate your wants and needs. In addition, you need to be practical and want to end up with drawings that a builder can quote and build from. An architect, a builder or a real estate professional can counsel you on which of your ideas may be impractical from a cost point of view.

Now that you have a building lot and a set of plans you need someone to build it for you. In your research you have probably looked at new home construction and talked with other people about their experience and recommendations. This is a good place to start. The local Home Builders Association can also supply you with names of builder members and a Realtor can be a good resource for information and recommendations.

The important thing is to meet with several builders, interview them and talk about their experience, look at the work that they have done and check out their references. You may want to end up with two or three builders you are comfortable with and who are prepared to quote on the construction of your custom home.

You will then submit your plans to them and review the guidelines for their quote. You want to compare “apples and apples” so you need to make sure that the materials and specifications are reasonably the same and that exclusions, inclusions and allowances are similar. As an example, on a custom home you can spend anywhere from $5,000 to $25,000 or more on windows so you need to know what you are getting and what the differences are. In order to properly compare, you want to get a line item quotation, which shows prices for all of the various components of the construction.

Once you have selected the builder and finalized the price you will need to enter into a contract. The builder may have a Realtor and may use a residential real estate contract or he may have his own contract that has been prepared by his attorney. The real estate contract does not address new home construction very well and the builder contract will probably favor the builder. In either case, you should consider the use of a Realtor to assist and advise you in the negotiation of the contract or use an attorney to review the contract.

One of the important items the contract will address will be how you are to pay for the home. There are many options available to you but mainly it will come down to whether you or your builder are going to arrange the construction financing. It will also need to be determined how the builder will access the money through construction draws. Again, an experienced Realtor can advise you and make recommendations on your financing options.

The planning and construction of your custom dream home can be a wonderful and rewarding experience and forming the right team, including designer, architect, builder, lender and real estate agent is a good way to start.

For more information on custom home construction or for answers to any of your real estate questions, please call or email us.

This entry was posted on Monday, January 28th, 2008 at 11:21 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.