Building a New Home

You're ready to build your dream house. You've reached the point in your life when you can construct a home that's made just for you. But, where do you start?

Select a Lot

Not just any plot will do. When finding your home site, consider these factors:

• Is the parcel of land large enough for the house you have in mind?
• What kind of property taxes will there be?
• Are municipal sewer and water lines available? If not, you'll have to install a cesspool and dig a well.
• What about the water table? Is this a flood plain area?
• Will the soil be strong enough to support the house?
• What's the grade like? Will it be too steep for your purposes?

Design Your Blueprint

Next, comes the plan. You need to be satisfied with its size, features, and layout. When reviewing a blueprint, make sure:

• It's not too large for your budget, or too small for your needs.
• There are plenty of bedrooms.
• You've got a kitchen that's well planned and accessible to the rest of house.
• There's a family room big enough for the family.
• The garage is large enough to fit the way you live.
• You've included all the amenities you've dreamed about (and can afford)such as a fireplace, clerestory windows, passive solar heating, decks, a large master suite and cathedral ceilings.

Finance the New Construction

Now, for the financing. You need to estimate how much it is going to cost you to buy the land and build the house. While the price of the land is easy to find out, construction costs may be more difficult to figure. After you've completed blueprints for a new house, take it to a builder or contractor that can give you an estimate. A builder can tell you approximately how many dollars per square foot it will cost to build. Knowing the square footage, you can approximate the construction cost. And with those figures, you can begin to shop for financing.

Pick a Builder

The person you hire as your builder should be someone that you like and trust. After all, he'll not only be building your home, he'll be spending your money. It's a relationship that will last for several months, so make sure you are comfortable. Here are some questions you should ask when hiring a builder:

• What else has he built in your area? Talk with the owners of houses he has previously constructed.
• Were they satisfied with his services? How did he manage time frames, what was his service and attention like once the home was completed? Check the quality of the construction.
• How do key subcontractors like working with him? What's his pay history?
• Can he guarantee his cost? Before he starts building, go over the entire plan with him to make sure you're getting the sizes and types of windows you want, your choice of fixtures, trim, cabinets. Make sure you know what you're getting for the money. If changes in the plan are necessary during construction, get them in writing with a firm price attached.

Manage the Process

To be sure your dream home doesn't become a financial nightmare you need to get everything in writing. Everything. Start with the base home price and standard specifications. Add any contingencies that may be necessary. Be sure to include in your contract any upgrades or products and features you desire. Vagueness and relying on verbal information and pricing can be an extreme source of frustration and disappointment. Not to mention, expensive.

After construction has begun, changes or change orders will often be necessary or desirable. Insist on the cost and description of each and every change being documented on paper and signed by both parties. This will eliminate any verbal miscommunications or misunderstandings. It is also a good practice for all construction draws to be co-approved by you and the bank. This is your guarantee that the builder does not get the draw until the work meets with your approval.

Remember, this is your home and money being spent, so you want to maintain as much control as possible over this segment of the construction process. Make sure the builder is requiring the sub-contractors to sign a lien waiver, once they have been paid for their work on your home, and ask to be provided with copies. This is your proof that the sub-contractor has been paid, and cannot place a lien on your home at a future date, due to lack of payment.

A Construction Timeline

Constructing a home can take anywhere from six months to one year (or more), depending on a number of factors. The size of the house, number of workers, weather conditions, and unexpected--but inevitable--delays all make a difference. Though the order of work may vary slightly and local building-inspection requirements differ, this timetable, spread over a seven-month period, should give you a pretty good sense of what to expect and when:

Months 1 & 2

• Obtain municipal and state permits
• Begin site work and excavation
• Pour foundation
• Frame floors
• Rough-in electrical and plumbing under floors
• Install first-floor subfloor

Months 2 & 3

• Frame walls, roof and ceilings, including all door and window rough openings
• Install remaining subfloors
• Apply exterior wall and roof sheathing
• Rough-in remaining electrical and plumbing lines in wall, ceiling and floor cavities

Months 3 & 4

• Inspect mechanical rough-in and exposed structural work
• Apply roof flashing and shingles
• Install windows and exterior doors
• Apply exterior trim
• Apply exterior-wall finish material

Months 5 & 6

• Install cabinets and countertops
• Apply ceramic tile in baths
• Finish plumbing and electrical work
• Paint and wallpaper
• Install finish flooring

Months 6 & 7

• Install hardware and appliances
• Touch-up for final inspection by homeowner and city building inspectors
• Landscape
• Make final payment to contractor
• Move in