This is spot on. I'm in the construction industry.
Thinking about self-contracting our new home build
- Thread starter 93Cobra#2771
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I don't think the OP has a time constraint. I agree though, only a fool would make that commitment.
Depends…how much experience do you have managing projects and do you already have a relationship with subs. If yes, I wouldn’t pass up the likely 30%+ savings.
Have a builder that is willing to do cost plus since you have the cash? Safer route and will keep the spending down as he’s just going to hand the bills and his agreed upon draws based. That in my mind is the best approach since you seem a bit apprehensive. Plus, it still allows you to do some of the work if you choose.
Have a builder that is willing to do cost plus since you have the cash? Safer route and will keep the spending down as he’s just going to hand the bills and his agreed upon draws based. That in my mind is the best approach since you seem a bit apprehensive. Plus, it still allows you to do some of the work if you choose.
30% savings bahhhaahhahaa, how do people even come up with this. Most contractors are going to charge 15-20% for their fee. In return their subs and suppliers are going to charge the GC less than what they will charge you. If you build it yourself you will save a little, but not enough that it will be worth the loss of time and quality control.
Mostly true here though if you know what stuff should cost you can shop around a bit to get cost in line with a Jv price. If you don’t know these things you are correct. Big pain is really you are the punch list guy too. Nobody is coming back unless it is something big.
If you think there aren’t at least 5-10% OH&P built in for most builders on the cost of the build itself, in addition to the market average of 18%, you’ve obviously not been on the budget side for a GC. My team alone did 80mil last year in roughly 17 states, I can tell you we averaged 27-29% on most jobs when all was said and done.
Good builders have a network, providing them a lower price, whereas a budget presented is current market value . That may not apply in a one off, but I guarantee you there is a cushion built in with a good estimating crew which leads to additional incurred costs to the client and generally ends up in the pockets of the builder if they have good management and subs.
Seeing as I own my residential design build company I see the budget side every day of my life, I can tell you that you are full of shit. From what you say, I'd guess you either a large commercial contractor or a company that builds cookie cutter neighborhoods hands you your paycheck. Cookie cutter neighborhood builders do make in the 30% per home range after all of the years and expense of development. On renovations I put 40% markup because of the complexity and time they eat up, but on custom new home builds there is no way to compete with other builders at 30%.
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Thank you for repeating what I said almost verbatim.
I repeat, you are not making 27-30% on custom new homes, which is the subject of this thread.
BTW if your client takes a budget to the bank with 30% markup for their construction loan, the bank is going to let them know that their 25-30% down just became 40% because at the end of the loan it isn't going to appraise when they need in order to roll into a mortgage. Then your client is going to wonder why you are trying to **** them.
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Apply this statement to every sub involved in a build. If it’s this difficult finding a GC good luck with the subs. I wouldn’t do it on my own if I were you.
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How is he going to figure out “what stuff should cost”?
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We did it. We live in one of the most difficult places to get permits and inspections.
Like most things, there's an upside and a down side. We have a good friend that is a general, so we used him as a consultant. His help was priceless. DM for any details you need help with.
Like most things, there's an upside and a down side. We have a good friend that is a general, so we used him as a consultant. His help was priceless. DM for any details you need help with.
A bunch of bids is the only way.
My wife self contracted our house on cape cod and did a gut job on the interior totally by herself and it came out awesome. But she is extremely picky and drove the workers crazy but she paid top dollar to do it all high end so bullshit excuses at any point were met with Hitleresque responses. She’s 100% Aryan. She don’t **** around.
Her conclusions. She wouldn’t do it any other way. She was in total control of every aspect of everything that went on.
When contractors started to blame another contractor like plumber vs electrician shit she’d force them to show up and have a meeting face to face to figure shit out.
You can’t skimp on shitty materials. If you can’t afford to do it top notch wait until you can because the low end shit is pure shit now a days.
Don’t pay anyone for anything except materials and have everything delivered on site. If a contractor won’t agree to this. **** em.
As they start to do the work pay in small increments. Don’t pay anything at all in full until the work is 100% perfection. If they want large sums of cash before they do any work. **** em. Move on. They’ll probably **** you in the ass.
She would have gotten ****ed on the hardwood floors on certain boards that got scratched up. She made them fix it. They didn’t want to so with the money she owed them she could have hired another contractor to come in and fix it. The original contractor knew this and threatened legal action because she still owed them 50%.
She welcomed a court date. She’s wicked smart. Has never lost to any contractor for anything.
Document everything. Dates worked performed etc in case you end up in court. She had a guy take her to court for a different job. She shows up to court with dates times. Everything. 5 minutes in. She won easily because these contractors don’t usually have solid records of anything. They get dates wrong and the judges come to the conclusion they are lying. Srs.
You have to be home or someone that knows what the **** they are doing has to be on site when the work is going on and everything has to be checked every day work is done to catch potential issues early. If you don’t know what you are looking at don’t self contract.
She works from home 4 days a week and her job is flexible. She doesn’t have to go into the office at all so for this project she was home 99% of the time.
Have a friend who knows about project management would be a plus also.
I’m sure I left shit out because I was not on the cape for any of this.
Good luck.
Her conclusions. She wouldn’t do it any other way. She was in total control of every aspect of everything that went on.
When contractors started to blame another contractor like plumber vs electrician shit she’d force them to show up and have a meeting face to face to figure shit out.
You can’t skimp on shitty materials. If you can’t afford to do it top notch wait until you can because the low end shit is pure shit now a days.
Don’t pay anyone for anything except materials and have everything delivered on site. If a contractor won’t agree to this. **** em.
As they start to do the work pay in small increments. Don’t pay anything at all in full until the work is 100% perfection. If they want large sums of cash before they do any work. **** em. Move on. They’ll probably **** you in the ass.
She would have gotten ****ed on the hardwood floors on certain boards that got scratched up. She made them fix it. They didn’t want to so with the money she owed them she could have hired another contractor to come in and fix it. The original contractor knew this and threatened legal action because she still owed them 50%.
She welcomed a court date. She’s wicked smart. Has never lost to any contractor for anything.
Document everything. Dates worked performed etc in case you end up in court. She had a guy take her to court for a different job. She shows up to court with dates times. Everything. 5 minutes in. She won easily because these contractors don’t usually have solid records of anything. They get dates wrong and the judges come to the conclusion they are lying. Srs.
You have to be home or someone that knows what the **** they are doing has to be on site when the work is going on and everything has to be checked every day work is done to catch potential issues early. If you don’t know what you are looking at don’t self contract.
She works from home 4 days a week and her job is flexible. She doesn’t have to go into the office at all so for this project she was home 99% of the time.
Have a friend who knows about project management would be a plus also.
I’m sure I left shit out because I was not on the cape for any of this.
Good luck.
Wow, love the info in here. Mirroring a lot of my thought processes too. I have an uncle who worked in commercial construction for 45 years that lives one house down that I'm going to ask if he'd be willing to go down to the job site and just sit in a chair and watch on a daily basis. Or even just a couple of spot checks during the day. A buddy of mine is also willing to do some spot checks, he GC his own build a number of years ago and is getting ready to do it again.
That’s the way bro. The cape is a very elderly population and we’ve been there since 2007 so we met and know a lot of retired “experts” in many fields. One of our good friends is our go to when we don’t know the answer.
Your uncle doesn’t have to be on site the entire time just lots of times and spot checks are beautiful, someone just needs to be close by and able to swing over fast when issues arise. My wife was downstairs in her home office all the time working. And they will arise. And if no one can come over the contractor can do what ever will save him the most time and money and not care about future issues.
One thing to remember. It’s your money and you will learn very fast that most of these people are only out to separate you from it in the easiest ways possible if you let them. Lots of them will cut corners at every possible opportunity even though they know there are inspections.
My wife now has very good friends that she can count on to do repairs and other projects. Plumbers. Electricians etc that know beyond a doubt she will not be taken advantage of but she pays on time for good quality work and won’t haggle for a few dollars for good work.
Bruno makes good points. We were living in our 5th wheel on site during our build, so that made it much easier. And my wife is much like Bruno's, was monitoring the build daily.
When it came time for inspection, we lucked out. Our inspector was a local guy. At one inspection he told me he goes a little easier on home owners building their own, because they want it right, whereas a contractor just wants to get it done for cheap.
When it came time for inspection, we lucked out. Our inspector was a local guy. At one inspection he told me he goes a little easier on home owners building their own, because they want it right, whereas a contractor just wants to get it done for cheap.
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