How to Start Building a New House

Intro

Building a new house is a dream for many of us. Figuring out how to do it is something different. There are many, many things to consider, which can be overwhelming.

Below is a comprehensive outline of the steps needed to get your house built. The order might vary a bit based on how you’ll accomplish your own project.

Determine the Size

You could take a stab at what size you want your new house to be based upon plans and other houses you’ve seen. However, you should do the following to be more accurate in the size you want

• Take an inventory of all furniture and their sizes, the lineal footage of storage you have, and a square footage of stored items that don’t fit in shelving.
• Figure out what will go with you to the new house, what you’ll get rid of, and what you’ll want new.
• Create a simple drawing of each space you want drawn to scale. Start by laying out the furnishings first, account for circulation space around the furniture, then determine the final room size.
• Add up all sizes of the spaces, then add 10% for wall thickness and 10% for circulation. This will give you the size target you actually want.

Determine the Quality

To determine quality, look at houses from articles, visit open houses, and drive around neighborhoods (new and old) to see what strikes you. Write down the materials you like for inside and outside along with the level of design detail you want (a lot of “bling” or simpler, cleaner lines and surfaces).

Determine the Construction Numbers

Most people want to just ask someone how much it costs to build “a house”. Costs can vary widely based on size, materials, level of design detailing, and location.

Instead, use the size and quality you’ve put together and do some leg work. Figure out a few architects and contractors in your area whose houses you like, then set up to meet with them. They can tell you how much to budget for the house you’re seeking.

Determine the Project Numbers

Once you get a general idea of how much your house might cost, you’ll then need to determine if its affordable. For this you need to pull together a lot of other numbers. You need the following information to put together accurate project numbers:

• Available funds for your project. This can include money at hand or easily convertible or loans you’ll take out for the project. Talk to your home lender about how much they’ll loan out to you.
• Your anticipated home operational costs for the new house, such as loan repayment costs for the project, utility costs, homeowner association fees (if applicable), municipal taxes and fees, homeowner insurance costs for your new home, and a reasonable contingency number for an unanticipated or unknown costs, say 20% at the start. Be sure to include any other monthly costs not listed above.
• Site purchase cost (if you don’t yet have the land). Include costs for closing on the property, and surveying.
• Design fees for architects, engineers, and landscape architects. You can contact local architects for this info. This will include any soils analysis and engineering.
• The potential construction cost based on your desired house size. Be sure this includes all site work, utility connections, landscaping, and permitting costs, along with all of the general contractor’s overhead costs. Include a contingency number at 20%. It’s best to get this from local architects and contractors.
• Your construction insurance costs for the duration of the project. Contact your insurance agent for info.
• Costs for new furnishings, including window coverings, carpets and rugs, appliances, etc. Include a contingency number of around 10%.
• Relocation costs once the project is complete.
• Real Estate Taxes for the new home.
• An additional contingency for things you haven’t thought about, say 5% of the overall total from the items above.

If your budget doesn’t fit your preferred house, reduce construction costs by first reducing the quality of materials, then reducing size if the finish reductions don’t get you where you want.

Figure Out How You’ll Design

Below are the options you can use to have your house designed:

• Hire an architect – a professional registered with your state.
• Hire a house designer – a non professional who has experience designing houses.
• Hire a design-build contractor. They provide both design services and construction services.
• Design the house yourself. You should at minimum have a contractor and possibly an architect review your design for a small fee to let you know of any issues you might not be aware of.

Figure Out How You’ll Build

Below are options for how you can have your house built:

• Traditional design-bid-build process, where the design and construction documents are completed first and then bid out to multiple contractors for competitive pricing.
• Design assist, where a contractor is selected before design is completed. The contractor will charge a consulting fee and establish his construction fee and overhead costs with you. They’ll then provide an “open book” process for the construction costs once subcontractor bidding begins.
• Contractor design-build.
• Self-build, where you act as the general contractor. Be sure to check with your local jurisdiction to see what they’ll require of you when acting as a contractor. This might involve registration/licensing and fee payments to the authority.

Select Your Site

If you haven’t selected a site, now is the time. Work with a local agent to identify available properties that fit your goals. You’ll need to understand the local zoning requirements for each parcel as there’ll be certain limitation as to how large and tall a house you can build and where you can build on the site.

You should also make sure the site you target can work for you in terms of location, views, solar path during the day, seasonal wind directions, soil limitations, utility services, property taxes, homeowner association fees and requirements, etc.

Hire Your Consultants

Consultants are the designers and engineers who have the expertise to get you the design you want. Consider the following:

• If you’re to work with an architect, be sure to select around three potential candidates and set up interviews. As them what their fees cover, what additional consulting fees to expect including for soils analysis of your site. Ask them about their license status to practice architecture.
• If you’re going design-build, talk to the contractor about what’s included in their fees, including any design and engineering costs for the project and who they tend to use for those services.
• If you’re building the house yourself, you’ll still likely need to consult with a soils engineer, structural engineer, possibly mechanical, electrical, and plumbing engineers if complex or unique systems are to be used, and potentially small fees from an architect or contractor to review your design for any issues of concern.

Design Your House

Design is the fun part of all this. This is where your ideas start to be created into realistic drawings that you can see and adjust along the way to get your dream home.

This is also when you’ll select the actual materials, finishes, appliances, cabinetry, plumbing and lighting fixtures, and all the other fun stuff that make the house your own.

Create the Contract Documents

Contract documents are the drawings and specifications that contractors bid and build off of. These drawings will have a lot of plans, details, and product schedules identifying what all goes into the house and where.

The specifications are written requirements for how the project is to be built in terms of quality, what the contractor’s to provide in conjunction with the construction (debris removal, sediment control, power during construction, bathroom facilities, insurance, etc.).

Specifications also state all the materials and products for the project by name, style, finish, product requirements, quality, and warranties.

Bid the Project

Bidding is the process by which contractors and subcontractors review the contract documents and then put together what they think the project will cost to build. Once you receive those numbers (the bids) you’ll be able to select the contractor that you think will provide the best quality of work for a price that works for you.

If you go with the traditional design-bid-build method you’ll bid the documents to a select list of general contractors, usually three. These contractors will then work with their network of subcontractors and suppliers to determine the bid price for the project.

If you go with a design-assist or design-build process you’ll already have the contractor on board. The bidding process involves that contractor’s network of suppliers and subcontractors. You’ll review with the general contractor the bids that come in and work with them to select the best subcontractors for the project.

Select a Contractor

Selecting the contractor to build your project should involve a lot of prep work on your part. You should look into numerous contractors in your area by checking out their website and projects. You can also see if anyone in your social group have worked with any contractors they’ve liked.

Once you identify the ones you think could deliver the house you want, set up interviews with them. Share with them the size and quality information you created at the start of this process and discuss what you envision. They can provide a likely (but not final) square-foot cost range.

Be sure to inquire about what their project overhead costs cover, what construction work they might do themselves versus work to the done by subcontractors, what insurance they’ll carry, subcontractors they typically use (so you can do some research on them), how they handle getting permits for construction, and references from others whose house they built.

Ask the contractor to arrange for tours of completed projects and projects under construction to get a sense of the work they do.

Contact the references to discuss how their projects went and ask if you can visit their houses to get a sense of quality the contractor provided.

Once you identify the three or so contractors you like best, you’ll have your bidding contractors for the project.

The process of selection will be similar for the design-assist route, except that you’ll select the contractor before the design is finished.

Obtain Construction Permits

Getting permits is always fun (not really). Smaller jurisdictions are typically simpler to deal with, often just requiring the filling out of a form and paying a fee. Larger jurisdictions can require more detailed review of what’s to be built and more fees for that review.

Be sure to work out if you’ll want to get the permits yourself or have the contractor obtain it as part of his contract for construction.

Build Your House

This is when your dream starts to become reality. This process takes time, sometimes up to a year or more depending on the size and complexity of the project.

This period requires periodic review of the progress, review of shop drawings and product information to confirm that the contractor’s providing what’s required, and review of monthly applications for payment based upon the completed portions of the work.

Complete Your Project

Completion of the project involves reviewing all the little items that the contractor is to address based upon a walk-through of the project with you – this is called the “punch list”.

You’ll receive from the contractor all product information, operation manuals, and warranty information.

Once everything is done, you’ll have a final application for payment to review and pay.

Once all of this is done you can then move into your new house and live the dream!

Note: All images by Cayl Hollis unless noted otherwise.