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.

Are you ready to build a custom home but don’t have a full set of plans?

How exciting!! You’re ready to build.  Maybe you’ve found a floorplan online you like but want to make a few changes.  Or maybe you have started talking to an architect to get some rough plans drawn up.  We have an earlier blog post detailing the difference between online plans and hiring an architect you can check out, but either way- you’re on the right track!  At this point, you have 2 different paths to choose from for the pre-construction phase.  You need to have a full set of plans before signing a contract with a builder, and there are two ways to go about obtaining these plans.

A Full Set of Plans

*full set of plans to include (at a minimum) the following:

1. Site plan – including flatwork & utilities

2. Floor plan

3. Reflected ceiling plan

4. Roof plan

5. (4) exterior elevations

6. Electrical plan

7. Engineered foundation plan

8. Engineered structural framing plan

The Two Pre-Construction Paths

Path 1: Manage the design phase yourself.

Path 2: Sign a design agreement with a builder.

There is no right or wrong option here.  It is totally up to you and your specific situation!  We’ll try to lay out the details of each path so you can make the decision that is right for you.

Path 1: Manage the design phase yourself.

Our very first client at JD Rock took this path, and we had an amazing experience with them!  Over the course of several months, they took the time to have an architect draw up plans for their custom home and corresponded regularly to ensure every detail was just right.  Next, they hired an engineer to engineer the plans.  Then, they sent their full set of architectural and engineered plans to multiple builders to bid on their custom home.  Thankfully, we won the job and got to work with these wonderful people!  The project went smoothly because all of the plans were finalized before we started construction.  

I would note – for this project, there was no HOA or official city to deal with.  This made the pre-construction phase much easier as the client did not have to seek approval from these entities.

Path 2: Sign a design agreement with a builder.

The second option for the pre-construction phase of your custom home is to sign a design agreement with a builder.  This option would work best for somebody who may not feel totally confident managing an architect and engineer on their own.  A design agreement hires a builder to manage and coordinate with you, the architect, and the engineer to design the ideal home for you – providing cost projections along the way.  By involving the builder early in the process, you’re avoiding the potential mistake of designing a home that is thousands of dollars (or more) over your budget.  Just to be clear – a design agreement does NOT necessarily lock you into using this builder to construct your home.  At the end of the design phase, you could submit your finalized plans to other builders for pricing and choose the best deal.

So again, there is no right or wrong option here.  You need to decide how hands-on you want to be, and how confident you are in managing the pre-construction phase on your own. Ultimately, choose the option that allows you to sleep in peace at night. We will never stop encouraging you to choose the path with the most peace of mind.

Fun and Practical Features to Include in Your Custom Home

Are you planning to build a custom home soon?  We’ve got some fun and practical ideas for you to consider…

Coffee Bar in the Main Bedroom

For you coffee drinkers out there, consider this!  How nice would it be to not have to leave your bedroom to get your coffee in the morning?  Talk to your architect about running plumbing and electrical to a little nook in your bedroom for some early morning cappuccinos.

Indoor Gun Range

Yeah, we said it.  If you have flexibility in your budget, include space for your hobbies in your home.  An indoor gun range may not be as expensive as you think – it is actually fairly simple to construct (and yes – it is legal).  You can buy a target retrieval system online for less than $1,500. Once all of your walls are soundproofed and padded, and the right lighting is in place – you’re all set for many hours of fun!

Splurge on the Main Shower

Get the rain showerhead.  Throw in a body spray or two.  Add another showerhead in case you don’t like showering alone.  Install a recessed light with a  built-in Bluetooth speaker so you can listen to your audiobook.  All of these splurges are well worth the minimal extra costs.

Central Vacuum System

Once again – another minimal cost with a high payoff would be a central vacuum system.  It is such a pain to have to go grab your vacuum cleaner and plug it in just to vacuum some crumbs off the floor after dinner (parents of toddlers- I know you feel this).  Consider installing a central vacuum system with built-in vacuums for all the main rooms of your home!

Hot Tub

Do we really need to sell you on this one?  Turn Netflix off, invite your friends over, and end your day in the hot tub on your back patio.  You’ll thank us later.

We hope these added flourishes bring you so much enjoyment during, and long after, your custom home build!

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?

Custom Home Building Contracts: Understand This Before Signing a Cost-Plus Contract

Last year, we posted a blog about the differences between cost-plus and lump-sum contracts, along with the pros and cons of each. If you haven’t already, I would recommend reading it now! Quick recap: in a cost-plus contract, the client and the builder agree upon a locked-in, unwavering management fee that will be paid to the builder for the project. Any budget overages or remediation work will be at the client's expense; therefore, the risk lies with the client. As a result of decreased risk, the contractor typically reduces their profit which gives the appearance of a “better deal”. In a lump-sum contract, the client and the builder agree upon a locked-in, unwavering CONTRACT price for the whole project. Whatever profit the builder makes will not be revealed to the client. There is no risk for the client should any budget overages or remediation occur- the risk lies with the contractor. 

I have spent the last year and a half working on 4 different cost-plus contracts. I want to emphasize how thankful I am for every client and the opportunity to learn and grow. Starting any new venture involves trial and error and I am so grateful for the clients who have chosen to join in the adventure. We entered into these initial projects believing that a cost-plus contract was the best option for everyone involved. However, on each of these projects, unexpected costs came up. We have not been immune to soaring material prices (like concrete) after our budget was set and the contract signed. All of this resulted in the client having to cough up more money - and I’ll add - disappointedly. Because our contract was cost-plus, they had to experience firsthand the messiness of construction and shoulder much of the stress.

Is a cost-plus contract always a bad idea? No, there are certainly times when it is advantageous. But it is critically important that the client understand how much risk they bear in a cost-plus contract, AND how exposed they are to cost fluctuations. This can really steal from the joy and excitement of building your own custom home. As a builder who wants to glorify God and bless others, I have struggled with cost-plus contracts. Everything in me wants to swoop in and pay for budget overages and remediation work for my clients so they are spared the stress and strain. But when a cost-plus contract is signed and my profit is reduced, I’m stripped of the ability to intervene. 

We want to bless people. Period. If I could go back in time, I would have strongly advised most of my clients to sign a lump-sum contract with me. It may be more expensive (at least initially), but once that contract is signed, they can sit back and enjoy watching their home come together. When budget overages occur and mistakes are made, I can immediately cover them. Your peace of mind and pocketbook are spared the strain. 

This seems to be a theme with many of our blogs, but peace of mind is worth it every single time.

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.

Common Custom Home Building Mistakes- Part 2

Happy New Year! We hope everyone enjoyed a wonderful holiday season with loved ones and delicious food. We at JD Rock are back and excited to jump into another year of custom homes and #bloggieaugie. 

Two weeks ago we left everyone hanging with part one of the most common custom home-building mistakes. Today we are concluding with two more common mistakes. Our desire is to help you avoid these pitfalls and enjoy the most smooth construction experience possible! Without further ado… 

MISTAKE #2 – Not Hiring an Interior Designer

Some builders are specifically gifted with an eye for design and the skillset to bring that design to life on various software.  The Lord did not gift me with an eye for design, and that is okay because I have met some amazing people who design for a living. A really good interior designer is more valuable than most people realize. They’re not just picking paint colors for your walls, they take a client’s fuzzy idea of what they want their home to feel like and turn it into an actual visible drawing.  I’ve had clients, several times, send me a handful of Pinterest photos and say “we want our fireplace to look something like this.”  No two photos will be alike, and I will be left with more questions than answers. This is frustrating for both the client and myself.  The client is struggling to convey what they want their fireplace to look like, and the lack of clear understanding regarding what to install is delaying my construction schedule. A good interior designer will have the software to draw up exactly what the client envisions and clearly dictate what materials are necessary to execute the vision. If you are spending the money and time to build a custom home, it is worth the extra expense to ensure the final product matches your vision.

MISTAKE #3 – Hiring the Cheapest Guy on the Block

1 Corinthians 3:10 says “like a wise master builder I laid a foundation, and another is building on it. But each man must be careful how he builds on it.”  For every custom home, a plethora of trades will be hired to build the various components. It can certainly be tempting to simply find the cheapest guy in town for each of these trades.  While not always true, it is safe to say that you get what you pay for. The cheaper the trade, the more handholding is required. The cheapest guy in town is generally horrible at timely and professional communication (specifically over text and email).  They can be nearly impossible to find if their work is revealed to have problems. Conversely, I have a foundation contractor who is not the cheapest guy in town. I spend a significant amount of money on him for every project. But, he is one of my most dependable and honest trades. He is extremely professional and somebody I am proud to introduce to my clients.  When engineers come to inspect his work, they commend his attention to detail. I never have to worry about his foundations, and that is worth every penny. So make sure to take your time and research to find the best guy, not just the cheapest guy. 

We will continue to share common mistakes in an effort to spare others the headache. However, avoiding these first 3 discussed mistakes will already put you in one of the best positions for a hassle-free construction experience. Take your time and get a full set of plans, hire an interior designer, and don’t settle for the cheapest labor in town if it isn’t the best!

Common Custom Home Building Mistakes Part One

Mistakes are universal across all occupations with an endless list of possibilities. Consider a barista making a simple cappuccino- Did she weigh her coffee grounds accurately?  Was her milk steamed to 135 degrees Fahrenheit? Did she time her espresso shot to make sure it was neither too bitter nor too sour?  Thankfully, if she failed to do any of these things right, she could just remake the drink – costing the coffee shop a couple of bucks and her client an extra 90 seconds. Not the end of the world.

Unfortunately, you cannot just rebuild a house if it does not turn out right. If the following mistakes can be avoided, the client will be happier, and the project will finish faster.  We at JD Rock Construction have made all the mistakes we will discuss.  We are grateful for them because of the valuable lessons they have taught us.  Moreover, we are grateful for the gracious clients who have endured these mistakes with us and for the patience they offered. Today we zero in on one particularly potent mistake…

MISTAKE #1 – Starting Construction Without a Full Set of Plans

This mistake begets most future mistakes.  Proverbs 24:3 says “by wisdom a house is built, and by understanding it is established.”  If you lack a full set of plans, then you also lack understanding.  The human brain can only retain so much data, but a set of plans never forgets what was drawn.  A full set of plans should, at a minimum, include the following:

·         Site plan

·         Floor plan

·         Ceiling plan

·         Electrical plan

·         (4) Exterior elevations

·         Roof plan

·         Engineered foundation plan

·         Engineered structural framing plan

As soon as the builder is given the green light to construct, he will hire subcontractors for the foundation, plumbing, and electrical system.  It would truly be better to hold off on construction a month or two until plans are finalized than to later tear out work because it was not what the client wanted. Let me emphasize that these plans must be final.  If the client signs off on the floor plan, he must understand that any deviation from the plan moving forward will come with a price. Getting plans extensively revised in the middle of the project is a nightmare and will create much more work for the builder and increase the likelihood of error from confusion. Save yourself the headache and ensure you have a full set of plans before commencing construction.

Be sure to check back for part 2 of Common Custom Home Building Mistakes and learn how to create your best custom home build experience!

The Truth About Price Per Square Foot

“What is your price per square foot?” This is the first question most often asked of a home builder and is, also, one of the most difficult to answer. Because the answer is more complicated, we want to help you better understand what is truly involved. It would be incredibly unfortunate for a client to hire a home builder under misunderstood conditions.

So- What does the price per square foot mean?  There are 2 parts to this equation.  The price takes into account the total cost of all labor, materials, and management for the project.  The square footage accounts for the total living area (emphasis on the living). The total living area includes all the areas that will receive heating and cooling.  Therefore, a garage that does not receive heating and cooling, will not be included.  Likewise, porches and driveways do not receive heating and cooling and are also excluded from the square footage. 

Here’s an example to illustrate the calculation: Let’s say the house you want to build has 3,000 square feet of total living area, a 2-car garage, and a 40-foot-long driveway.  The builder has quoted you $600,000 for the project.  Therefore, the price per square foot would be $200 ($600,000 divided by 3,000 SF = $200/SF). 

Now, consider building the same 3,000-square-foot house with a 4-car garage and an 80-foot-long driveway.  Even though the total living area has not changed, the builder will be unable to build the home for $200 per square foot because he has to pay extra for the additional garage and driveway labor and materials. Because the total cost increased, the price per square foot will also increase. The same would be true if the square footage remained the same, but you decided to have all of the walls painted by a renowned artist or selected all appliances from Italy. When the total cost rises, the price per square foot must follow.

Hopefully, these examples make clear that the price per square foot is most impacted by the decisions of the client NOT the home builder. All custom home builders provide the exact same service.  They hire the labor and purchase the materials to build exactly what you want.  The same tile setter would be hired to install $1/square foot tile or $50/square foot tile.  The same plumber would be hired to install standard Home Depot plumbing fixtures or the most expensive Kohler fixtures.  When you see a “famous” home builder on Instagram posting photos of a gorgeous mansion in a celebrity neighborhood, they provide the exact same service as a home builder who builds a modest ranch house in the middle of nowhere.  The price per square foot may be wildly different between the two, but both builders did the same thing- they managed the building of a custom home. 

What distinguishes a builder is NOT their price per square foot; but their approachability and integrity. If you are considering building a custom home, you should absolutely get multiple bids on your house from builders in your area. You will find that they quote you roughly the same price per square foot. However, you should take the time to get to know each builder and determine whether or not you trust them. Determine whether or not you would be willing to communicate with them for the next year or so as they build your home. Then make the decision to hire the overall best home builder for YOU.

Help! I Just Decided to Build a Custom Home- Where do I start?

*Disclaimer- We are going to assume you have already done your homework to ensure that you are in adequate financial positioning to build your dream home, and that you will be able to acquire a construction loan for the project.  We may do a separate blog on this one day.  For now – we’re assuming this portion has already happened.*

You just made the decision to build your dream home and are wondering where to start.  So exciting! To kick things off and get the ball rolling, you should follow these chronological steps:

1. Obtain your property plat.  When you purchased your property, it should have come with an official plat.  A plat is a document drawn up by a surveyor which outlines (dimensionally) your property’s borders and any easements.  Along with this document, you should reach out to your homeowners association (HOA for short) or the city to determine setback restrictions.  Typically, neighborhoods will not allow you to stick your house wherever on your lot you so desire.  They will outline how many feet from the street, how many feet from neighboring properties, and how many feet from the rear property line your house can sit.  It is so critical that before you even begin designing your dream home or shopping for the plan online, you know where your house is legally allowed to be positioned on the property.

2. Obtain your HOA’s rules and restrictions on what you can and cannot build.  They will mention things like – “minimum square footage of 2,500 SF” or “minimum of 75% of exterior walls must be composed of masonry, brick or rock”.  Make sure you understand what you can and cannot construct. 

3. Now for some fun- it’s time to get your plans drawn up!  We will post a blog soon on “Should I Purchase Plans Online or Hire an Architect”.  If you are going to purchase plans online, please make sure you first send a link of the plans (BEFORE YOU PURCHASE) to your HOA or the city (whoever you need permission from) for their approval.  Once you buy plans online, you cannot return them.  It is a permanent transaction.  If you are hiring an architect, make sure they build a relationship with the HOA or city and are aware of all requirements and restrictions.  One important note I’ll make on this step – spend the money on a site plan.  Ask your architect if this is a service they provide.  A site plan will show exactly where the house is going to sit on the property and illustrate the driveway layout, any sidewalks, existing trees that will remain, the pool, etc. 

4. Find a home builder. Check out our blog on “Important Questions to Ask a Potential Custom Home Builder” for help on this step.  The builder will want to see your plans before they can give you an accurate bid.  If all you have is a general square footage, they can only give you, at best, a ballpark price per SF.  Send your plans to 2 or 3 builders so you can get apples to apples bids.  

Hopefully you now feel prepared to commence your custom home build with as smooth a process as possible. You can do this!