Getting Utilities on Raw Land: A Journey Through the Expected Costs

Howdy landowners and future builders! Today, we are exploring the fascinating world of getting utilities on raw land. 

We all know that bringing your dream home to life requires more than just imagination and a sturdy foundation. Maybe the need for developing raw land with utilities has never crossed your mind, but it's time to dive into the details you need to know. 

The Key Components

Electricity, water, natural gas, and sewer (or septic systems for most areas) are the key players in the utilities game. The cost of getting these utilities on raw land near San Antonio can vary based on factors like location, type of service, and distance from existing lines. But fear not, we’re here to break down what we can! 

Utility Cost Breakdown

Electricity: The power source that keeps your lights shining and appliances buzzing. Depending on your home's size and electrical needs, budget between $1,000 and $5,000 to connect electricity to your raw land. 

Water: The life force that quenches your thirst and keeps your plants thriving. To get water flowing on your land, set aside around $1,000 to $5,000. Remember, the cost may vary based on your specific location and water service requirements. 

Natural Gas: The energy source that warms your hearth and cooks your favorite meals. You'll typically need between $1,000 and $5,000 to bring natural gas to your property near San Antonio. Be sure to check with your local utility company for specific costs and availability in your area. 

Sewer (or Septic System): Ah, the unsung hero of waste management. If you're in an area where a septic system is required, you'll be looking at an estimated cost of $10,000 to $12,000. Remember, this option offers you greater independence and flexibility when it comes to waste disposal.

Now, let's not forget about trenching and installation—you can expect to invest between $1,000 and $5,000, depending on the length of the trench and the type of utilities you're installing. It's essential to factor in these costs when planning your budget for utilities. 

Keep in mind that these numbers are estimates! Reach out to your local utility company for accurate pricing tailored to your specific situation. They're the experts who will guide you through the process and provide the most up-to-date information. 

Tips to Get Started

To help you on your journey, here are a few tips:

1️⃣ Contact your local utility company: They hold the knowledge of available utilities in your area and can provide detailed cost breakdowns.

2️⃣ Seek multiple quotes: Gather quotes from different contractors to ensure you get the best price for trenching and installation.

3️⃣ Be prepared for deposits: Utility companies may require a deposit before connecting your utilities, so plan accordingly.

4️⃣ Patience is key: Remember, Rome wasn't built in a day, and neither will your utilities be connected overnight. It may take weeks or even months to complete the process. Stay positive and stay patient. 

So, future custom homeowners, keep your dreams alive, stay informed, and remember that the reward of having your own peaceful oasis is worth the time and money invested. By understanding the costs involved and following these tips, you'll be better equipped to navigate this part of your journey! 

If you have any questions or need further assistance, feel free to reach out. We are here to support you every step of the way. Happy building!

P.S. If this is overwhelming and you want nothing to do with setting up your utilities- we hear you! We offer a preconstruction package in which we handle the nitty-gritty details of developing your raw land so your mind can rest easy. Schedule a consultation call and ask all about how this package could work for you!

Start With a Budget, NOT a Floor Plan

It is MUCH easier to build a floor plan based on a budget than it is to chisel away at an expensive floor plan.  You will almost certainly be over budget on your construction project if you go with the latter option.

At JD Rock, we push peace of mind above all else.  If you cannot pay for your “dream home” with peace of mind, it will turn into a nightmare!  

Now, it probably goes without saying that the more expensive the custom home, the more the builder will profit. But as the builder, we are here to say that we would rather you build the less expensive home with less stress than sacrifice your peace and max out your budget.

We at JD Rock obviously do not know your personal financial situation – so it is up to you to do your homework and determine what you can afford.  We recommend a build budget at least 8% lower than what you are pre-approved for at the bank.  So, if your bank approves you for a $700,000 construction loan, we recommend not to exceed a $644,000 contract with a builder ($56K less than your approved amount). We know this sounds crazy- but by doing so, you are setting yourself up for peace of mind.  When it comes time to make finish-out selections for your home (flooring, fixtures, appliances, etc), you can feel the freedom to splurge a little.  However, don’t forget about all the sneaky expenses at the end of the project like paying movers to haul in all of your furniture.  If you are renting a home during the build, is the timing going to align so that you never pay a mortgage and rent check the same month?  If not, have money allocated for this!  Are you going to want to host a party or two in your new home once you are settled? Prepare and don’t let yourself be house rich while cash poor (all your money is locked up in your home).

Again – we push peace of mind above all else.  Your family will experience peace and joy in your home when you live within your means.  An extra 500 square feet of living area will not produce lasting joy.  Neither will a $12,000 refrigerator.  Chase peace and joy, don’t chase the Joneses.

A Simple Way to Save $ on Your Custom Home

We will say it again and again- we are here to help you enjoy the process of building your custom home, and saving money/staying within your budget significantly impacts that enjoyment. So today’s money-saving tip is pretty simple – build a two (or even 3) story home.  Why?  As of March 2023, concrete is expensive and wood is cheap (at least cheaper than it used to be).  It’s that simple.  

Let’s say you want 2,400 ft² of living area.  Here are two options to consider:

• Option 1 – 1 story

• Option 2 – 2 story (1,200 ft² per floor)

In Option 1, you’re going to spend money on a 2,400 ft² concrete foundation – as well as covering 2,400 ft² of surface area with a roof.

In Option 2, you’re only going to spend money on a 1,200 ft² foundation – and only cover 1,200 ft² of surface area with a roof.

Because concrete is the expensive beast these days, cutting the foundation's square footage in half by stacking two floors on top of each other could save you around $25,000!

We’re not trying to pressure you into a certain look, just offering some food for thought.  You can keep the exact same size home while cutting the foundation (and roof) cost in half.  This allows for a beefier budget in other areas like appliances, flooring, etc.

In a few years, these numbers could completely flip; however, we want you to enjoy your custom home build today! And today, concrete is more expensive than wood.

Custom Home Building Concepts You Need to Know - Allowances

What’s an allowance?  When you sign a contract for a custom home, the builder will usually give you several “allowances” for various components of the finish-out.  For example, the budgeted allowance for appliances could be $20,000.  Therefore, your home would be built, per plan, with $20,000 included in the budget for the purchasing of appliances.  This way, you can shop around and pick whatever appliances you desire. But beware- if your appliances of choice exceed $20,000, you will be responsible for covering the price excess or have to select cheaper appliances.  Conversely, if the quoted price for appliances comes back at $15,000, then the builder would write you a check for $5,000 at the project’s end.

So, when a builder sends you a proposal, be sure to carefully review all of the included allowances before signing a contract.  Usually, the following items fall under the category of an allowance:

• Appliances

• Plumbing fixtures

• Tile

• Flooring

• Countertops

• Lighting

• Rock material

• Door Hardware

• Mirrors

• Toilet and bath accessories

Make sure you’ve done your homework regarding these allowances before signing a contract.  You may have always had your heart set on a certain wood flooring (not knowing that it costs $15/SF).  If the builder lists the wood flooring allowance at $8/SF, you are going to be very bummed when you realize how much your dream wood flooring costs – forcing you to settle for something else (or cough up thousands of dollars unexpectedly).

Here are some easy and practical ways to do your homework: 

1. Shop online.  Build a spreadsheet with all the appliances you like and estimate how much you need budgeted for your fridge, oven/range, dishwasher, washer, dryer, etc.

2. Go visit a showroom.  There are a multitude of local vendors around you.  Go visit one of their showrooms and ask for a sales representative to show you around.  This way, you can touch and feel products to determine what you really like.  The sales rep can very easily put pricing together for you.

3. Enlist the help of an interior designer. This is just one of the many ways an interior designer can assist in the home building process. Check out our blog from a couple of weeks ago for an in-depth analysis of interior designers and their benefits.

As always, we are here for your peace of mind and hope this information blesses your construction experience!

Custom Home Interior Designers- Why you need them and what to look for

Interior designers can save you time, sanity, and money, and create a beautiful space to top it off! In my never-ending pursuit of your peace of mind, I introduce to you the magic of the interior designer. 

The Interior Designer Relationship

Let’s first start by explaining how interior designers fit in the relationship with the client, architect, and builder. Chronologically, this is how it roughly plays out. The client approaches the builder with a complete (or near complete) set of plans drawn by an architect. The builder and client work hand in hand with the architect to finalize the plans. At this point, a contractual agreement is made between the client and builder over said plans, and construction begins. It is at this point that the interior designer is brought in – once a full set of plans are complete and no more structural changes will be made to the size/shape of the home.

A Really Good Interior Designer Described

What is an interior designer? Or better yet – what does a really good interior designer do?  I have had the pleasure of working with a couple of different designers over the years, and they are worth every penny.  Really good interior designers sit down with the client to get an overall feel for the kind of style they hope to achieve in their custom home (modern, rustic, boho, farmhouse, industrial, etc.). These designers will have established relationships with local vendors. They’ll take the client to showrooms to let them see and touch different materials to aid in making selections. A really good designer will have up-to-date design software that allows the client to (for example) see a simulation of their actual shower with their selected tile on the walls. I can’t emphasize enough the peace this provides for the client as they make their selections. They don’t have to hope and pray while they wait for the tile to be installed to see if they like it. Lastly, a really good interior designer should provide a detailed selections packet (signed by the client) to the builder for seamless communication.  Designers should be in the weeds with a lot of the decision-making. For example, if I, as the builder, am only told what tile is going on the bathroom shower walls – I am left with many unanswered questions. What color grout? What size is the grout thickness? In what pattern does the client want the tile laid? Is there a shampoo niche? If so, where and what does it look like?  How does the edge of the shower tile transition to the bathroom drywall? Is this transition completed with a bullnose tile or a metal trim? If metal – what color? Are you starting to get the idea? This amount of questions may seem ridiculous, but I doubt any client would prefer I attempt to read their mind. A really good interior designer would know what questions to ask and take the time to gain a full and complete understanding of what the client wants.

More Benefits of an Interior Designer

Further, an interior designer will keep your project on track with the selections schedule. This is where a designer really proves their time and money-saving value. Navigating lengthy lead times for materials requires that selections be made early and on schedule to ensure progress is not delayed. A common example is windows. Windows can take months to arrive on the job site, so windows are one of the first selections I require a client to submit. If a client fails to make a selection by the agreed-upon deadline, an extension ranging from days to weeks will be incurred along with a potential financial upcharge. But with an interior designer, you can rest easy and be at peace knowing that you are making all the right decisions at the right time.  

Additionally, an interior designer minimizes your likelihood of change orders. I mentioned earlier that a designer has software that allows you to visualize your selections prior to installation. This decreases the need for later changes resulting from not being satisfied with the look of your selections. Every change order automatically adds time and money to your project. 

A Design Selections List

It is worth noting that many of the great “interior” designers actually design both the interior and exterior components of the home.  Here is a list of all the selections you should expect your interior designer to help you make in your custom home:

EXTERIOR

• Windows

• Exterior Doors & Hardware

• Fiber Cement Siding

• Rock & Mortar

• Garage Door

• Stucco

• Lighting

• Roof Type & Color

INTERIOR

• Drywall Texture

• Paint Colors

• Trimwork

• Interior Doors & Hardware

• Cabinets & Hardware

• Countertops

• Fireplace

• Flooring (Wood, Tile, Carpet, etc.)

• Shower Tile

• Plumbing Fixtures

• Appliances

• Bath Hardware

• Mirrors

• Lighting

Are you convinced yet that you need an interior designer on your custom home-building team?

Peace of Mind Starts With Your Budget

I worked on 4 different Cost-Plus Contracts in 2022.  We unpacked the details involved in this kind of contract in a previous blog, but, essentially, the clients saw all of our numbers on the job and were on the hook for any overages to the budget.  For the most part, these projects all came in with budget overages of less than 1% of the project cost (which is amazing!).  However, I noticed that when clients selected their finish-out (think lighting, plumbing fixtures, flooring, hardware, all the pretty things), they wished they had a bigger finish-out budget. No matter how small or vast the budget, the client had typically obtained the largest construction loan they could afford.  As a result, they tended to feel stressed about every little decision along the way because they could just barely afford the project.  This inevitably results in a miserable construction experience for both the client and builder.  Financial strain supercharges every decision with emotion. 

On a smaller scale, consider a car- I could probably go out today and find somebody to loan me money for a brand-new Lexus with all the bells and whistles.  But because this would be a financial strain for me, I could never enjoy the car. I would need to sacrifice my current quality of life and luxuries just for the fancy car.  So I would miserably drive the car around town. Is that car really worth it? The same concept applies to a custom home. 

I would strongly advise my future clients to not max out on the largest loan possible. I would strongly advise my future clients to have some fluff in their budget so that the unexpected is less stressful and they can comfortably pick their actual favorites when it’s time to select wood flooring and bathroom tile. One strategy I recommend is to budget for 5-10% less than your max in order to establish a cash reserve. Another easy way to have breathing room in your budget is to not build the biggest house possible. If a house costs you $225/square foot, then 100 square feet would cost $22,500.  Now, some people reading this may genuinely need the larger home over a nicer finish out.  Everyone’s situation is different!  All I want to do is encourage you to not bite off more than you can chew with a loan, and remind you that peace of mind is ALWAYS better than a bigger or fancier home.  Build something you will love, not something you will regret.