Wife and I want to build our own house - what do we need to know?

[SWScorch]

As you may have deduced from the title, my wife and I currently renting a townhouse, and are thinking about building a house instead of buying one. I've started doing some research to find out what steps and paths to go through, but I want to hear any suggestions from those who have actually been through this process firsthand.

From what I've read, it sounds like owning the land already is the way to go, rather than getting a loan to cover both buying the land and paying for the construction of the house. We have a fair amount of money stored up; about $30k between a couple of different accounts. Would it be better to use the majority of that to buy a parcel of land, and then take out a loan only to cover the construction costs?

I have a friend who is an architect, and we are meeting with her on Friday to discuss what we want in a house. What kind of questions should I bring up? My wife and I have a list of features we want, but what kinds of business/technical questions should we ask?

Also, any tips/hints/comments on things that I should keep in mind when meeting with anyone or throughout the whole process? Thanks folks!

 

[Eug]

1. It will cost you more than you think it will cost you.
2. $30000 is not very much money. Mind you, $30000 will go a lot further in Rochester than in Toronto.
3. Getting a mortgage on an existing house is a very different kettle of fish from getting a loan for construction of a house.
4. The first question you should ask your architect is how much she charges and what she does for you during the process.

N.B. I have not been through this myself, but know some who have, and have done a major reno at my house.

 

[randomrogue]

I took a real estate class in graduate school and the professor stressed something right from the get go: A majority of couples who start the process of building a home together end up getting divorced. The reason? Money of course. You start the process, pay the architect, and suddenly your wife (or you) wants to make changes. You want to, for some reason after the fact, adjust the placement of the kitchen counter for an additional cost of $5000. I'm just throwing out an example but basically the financial stress leads to huge problems.

His point was that if you're serious about building a home together make sure you understand the costs and stress involved. Most importantly don't backseat build the house and make changes after a decision has been made.

There's some really good literature on the topic. I don't have any suggestions off the top of my head but I'd definitely do some serious reading before you start this process.

 

[IGemini]

Check with Rochester city hall (or whichever township applies) for the necessary permits in zoning and building.

http://www.cityofrochester.gov/article.aspx?id=8589936671

 

[MagnusTheBrewer]

Watch the HGTV series Dream House. I'm serious. Avoid all the mistakes that the couples made in the show.

Decide on materials, colors, fixtures and, hardware BEFORE construction begins.

Find a good contractor. Do not act as your own General contractor. The fact that you are asking these kinds of questions means you don't have the knowledge. Good contractors are busy. Be prepared to wait.

Before contracting with anyone, check their references and their work.

Depending on the job, NEVER pay more than 50% up front (usually less).

 

[BladeVenom]

I use to work with someone who bought a little old house on a decent sized piece of land. He lived in the small house while building his dream house.

 

[alphatarget1]

Sometimes you can buy land where they already have a set of plans drawn up for the house.

Are there existing utilities that you can tie into? Or would you have to request new service? Septic tank or connect to the city sewage system? Make sure there are no easements on the property/ you are not building on someone else's easements. It certain is exciting to build your own house but there is a lot involved... It might be easier to buy a crappy house with all of the things (and then the stuff I didn't mention) in place and just rebuild/gut the whole thing and redo. Unless you want your house to look crazy, you shouldn't need a structural engineer for a single family home, although they are way more competent than architects when it comes to, well, structures.

<did structural engineering for a few months before studying abroad and civil engineering for a few months before starting grad school.

 

[shortylickens]

My aunt an uncle have built 4 of their own houses. They learned a LOT each time. The first one was a mess but very educational. I'd suggest you dont actually plan on keeping your first one.

 

[drnickriviera]

Above posters are all good info. I don't think it's possible to stress enough the planning. The stress is unreal and what randomrogue said is correct. Lots of couples do get a divorce. It's not just the money. There are so many decisions that have to be made.

Any particular reason why you want to build a custom home instead of buying something on the market? Any specific features you don't think you can find?

 

[MagnusTheBrewer]

Once the house is framed, do a life size mock-up of the kitchen using cardboard boxes to ensure decent flow. Pay attention to areas where an open door (refrigerator, oven etc.) may cause problems.

 

[JulesMaximus]

First of all, you have to post pics of your wife. You know the rules.

 

[Fritzo]

1. Your monthly payments will be about 25% higher than the bank tells you due to insurance and taxes being rolled in.

2. Lay CAT6 cable in every major room BEFORE they put drywall up. You'll be happy you did then when you need to add a phone jack or need media wiring.

3. Paint as soon as the drywall goes up. You can touch up later and don't have to worry about staining up the trim/carpet.

4. Go with wood floors. It increases the home value, prevents odors from building up, it's easier to keep clean, and they last forever.

5. Get tile around the bathtub/shower. If the plans don't call for it, have it installed.

6. Have them put in a backup sump pump right off the bat. If they don't do it, be sure to have one installed as soon as you move in.

7. Get the largest garage you can afford. If they offer a 3 car garage option, get it. That way you can get both cars in the garage and still have room for lawn tools/lawn mower/workbench/toys.

8. See if they'll put topsoil on the lawn before they spray seed. If they don't, they may be using the crappy clay/sand stuff they got when they dug out the basement. There are no nutrients in this soil and you'll spend a fortune in fertilizer.

That's all I can think of at the moment.

 

[MagnusTheBrewer]

Plumb for a water filler over the stove. Don't forget venting for roof mounted exhaust fan.

On second thought, forget the refrigerator, get a small walk-in with a freezer in the back. Put frost free insulated glass doors on the side of the walk-in facing the kitchen. Put wire racks in the walk-in along the doors so, when working in the kitchen, you can access foodstuffs easily.

Sorry, I tend to view houses as kitchens with ancillary rooms.

If you have any questions regarding kitchens however, shoot me a pm. Don't pay for "Kitchen Designers."

 

[OlafSicky]

Get a contractor he will save you money. But the best thing to do is not to do it. Don't do it!!!

 

[Dr. Zaus]

As you may have deduced from the title, my wife and I currently renting a townhouse

This could NOT be deduced from the title.

 

[SWScorch]

Thanks guys; good stuff so far. Magnus, you are exactly right. I will be hiring a contractor; I can fix some small stuff around the house but I most certainly not able to physically build a house myself. That would just be bad news all around! Also, I agree 100% about the kitchen; that is actually one of the main reasons we want to build versus buy. I am very picky about my kitchen as I like to cook and like to eat even more. I need a large kitchen with lots of counter and cupboard space as my wife and I take our food very seriously.

Eug, 30K looks like enough to buy us anywhere from 3-10 acres depending on where we want to live. We are both country bumpkins and want to live far outside the city, as rural as possible, so land is pretty cheap out in the boonies.

The reason we want to build versus buy is that A) we are both pretty picky about what we want in a house, B) her parents build their house, and C) we can be sure that we are getting a well-built structure. Obviously I understand that it is still very possible to hire a sub-par contractor and end up with a shoddy house, but that is why I am asking for things to consider so I can make sure that this doesn't happen.

 

[Greenman]

Look into "off the shelf" plans. If you can find something you like, it's possible to save some serious money on architectural fees.
Spend the time to check your contractors references. Was his pricing of changes fair? Was he pleasant to work with? Did he finish on time and on budget? Did he offer solutions to problems or just toss it back to the architect and start working on the change order? Verify his general liability and workmen's comp.

 

[sdifox]

Thanks guys; good stuff so far. Magnus, you are exactly right. I will be hiring a contractor; I can fix some small stuff around the house but I most certainly not able to physically build a house myself. That would just be bad news all around! Also, I agree 100% about the kitchen; that is actually one of the main reasons we want to build versus buy. I am very picky about my kitchen as I like to cook and like to eat even more. I need a large kitchen with lots of counter and cupboard space as my wife and I take our food very seriously.

Eug, 30K looks like enough to buy us anywhere from 3-10 acres depending on where we want to live. We are both country bumpkins and want to live far outside the city, as rural as possible, so land is pretty cheap out in the boonies.

The reason we want to build versus buy is that A) we are both pretty picky about what we want in a house, B) her parents build their house, and C) we can be sure that we are getting a well-built structure. Obviously I understand that it is still very possible to hire a sub-par contractor and end up with a shoddy house, but that is why I am asking for things to consider so I can make sure that this doesn't happen.

maybe I should buy some land there too. :biggrin:

 

[Fingolfin269]

Going through this process right now. To be honest it isnt really that stressful, at least not thus far, but then again a friend of ours is the builder and we've given him a lot of artistic freedom.

 

[vi edit]

I'll answer more later tonight when I have more time, but I'll drop this in here...a pretty honest and long breakdown on my home construction.

http://forums.anandtech.com/showthread.php?t=2056984&highlight=construction

 

[boomerang]

Unless things have changed I think you'll have difficulty finding a lender to give you a mortgage on new construction without owning the land.

You will need a very substantial amount down because your home will cost far more to build than what existing homes are selling for. This will vary across the country and you would/should know better than the rest of us what conditions are like where you're intending to build.

All this advice about what to build, how to build it and pitfalls to look out for are nice and I know the advice is well intended but it's putting the cart before the horse.

Honestly, $30K is not going to cut it in my opinion. If your architect friend is going to do the initial consult gratis, good. If not, find a local Realtor and talk to them. In addition, don't assume an architect knows what it costs to build things. In my experience, that's not the case.

If nothing else, consider my advice as being from the devil's advocate position.

 

[OVerLoRDI]

I know nothing about this process, but my gut tells me 30k won't go as far as you are hoping. I'd say save up more before embarking on this adventure.

 

[SWScorch]

Unless things have changed I think you'll have difficulty finding a lender to give you a mortgage on new construction without owning the land.

You will need a very substantial amount down because your home will cost far more to build than what existing homes are selling for. This will vary across the country and you would/should know better than the rest of us what conditions are like where you're intending to build.

All this advice about what to build, how to build it and pitfalls to look out for are nice and I know the advice is well intended but it's putting the cart before the horse.

Honestly, $30K is not going to cut it in my opinion. If your architect friend is going to do the initial consult gratis, good. If not, find a local Realtor and talk to them. In addition, don't assume an architect knows what it costs to build things. In my experience, that's not the case.

If nothing else, consider my advice as being from the devil's advocate position.

This is the kind of stuff I want to hear. As far as the money goes, we saved the 30K without really being careful about our spending. I just got a promotion at work with a nice pay increase, and my wife has unofficially been offered a similar promotion that will likely take place in the next month or so. We plan to not even start building until next year if we do decide to do this, and she can work overtime, so I am confident that we could triple the amount we have in savings by next year if we need to. We were able to save up about 30k for our wedding in about a year, and that was when we both making less money.

But again, these are the hard facts I want to know. If it really isn't feasible for us to build, then it is far better to make that determination early in the process before we get too involved, and are able to change tack and look at existing houses.

 

[OVerLoRDI]

Also, if 30k is most/all of your savings, spending it all on a house is a bad plan. If something goes wrong, health issues, car wreck, losing your job, etc.. You are setting yourself up for going into debt further.

It just feels too risky in my opinion.

 

[silverpig]

Look into "off the shelf" plans. If you can find something you like, it's possible to save some serious money on architectural fees.
Spend the time to check your contractors references. Was his pricing of changes fair? Was he pleasant to work with? Did he finish on time and on budget? Did he offer solutions to problems or just toss it back to the architect and start working on the change order? Verify his general liability and workmen's comp.

This, this, and this.

I know some people who designed their own houses and got them all custom built. They did a shit job. The flow from one room to another didn't work, doors opened into each other, they are full of really personal customizations that make the place unattractive to others...

This makes the place damn near impossible to sell later.

Think about Michael Jordan's house. It's huge and has a basketball court in it. Who do you think is going to want to buy it?

What is best to do is to get standard pieces and put them together in a personal way. You can visit other houses you like and take pictures of them to show the architect what you are thinking of. It'll be cheaper and you'll get something that works well.