The upside of a down economy where the near collapse of the real estate market is dragging home value down to historic lows is that the cost of acquiring land, constructing and designing a new home and financing rates are at an all-time low as well, making it as cost effective as possible to build a custom home now.
For those who have always wanted to build a dream home, a new custom home with all of the personal touches that will make it truly unique, experts advise that this marketplace couldn't be better. All building materials are seeing a supply surge in the down economy which is creating many discount opportunities on even custom pieces like stone and tile or fine amenities like salvaged stained glass or weathered barn wood. Contractors and subcontractors, design engineers and housing architects - all super busy and high priced in the go-go years of the mid 2000s - have open schedules and can complete projects in record times and because they are hungry for work, their fees are at a minimum.
People looking to finally take the leap into the custom home of a lifetime also have the advantage of being able to pick and choose their building partners and command their full attention. However, even with the stars aligning to make this one of the best times to build a custom home in decades, prospective new home buyers still have to be vigilant in their planning.
Here, according to custom home building experts, are the Top 5 Steps to Take Before Starting to Build A New Custom Home:
· Do your research on the housing market. Every new custom home begins with the selection of building location, typically an existing older home in a desired neighborhood that would make an excellent location and a good building site. Look around for neighborhoods with the type of home you are looking to build with new homes in the price category you want to achieve; a neighborhood where the housing stock is turning over to newer homes. This will afford you the opportunity of finding a smaller "scrap-off" home for the price of the lot, and the proximity of other newer, larger homes will protect the investment.
· Find an architect with a similar portfolio. You need to find an architect experienced at designing custom homes similar to your planned project - the same size category, in the same area, with similar types of building materials. If you are planning a lot of custom stone work, or a custom kitchen with unique attributes, better to go with a designer who has been there before.
· Find a custom home builder with similar experience. Finding the right builder, who will act as project manager, is a very important step. The requisite experience should not only cover the size of home in question, and the building materials projected, but also the area in which the project is going to be done. Building codes and availability of resources vary widely from area to area, even within a single metropolitan area, so having a custom home builder with experience in that specific area can save time and expense.
· Look for subcontractors who can handle the job. Not every electrician, roofer, plumber, landscaper, etc., has the demonstrated expertise to handle the amenities you are planning. Often sub-contractors are selected on the basis of price, which can be the wrong way to go if the project includes special additions. Have they installed a home theater? Do they specialize in whirlpools, spas, or swimming pools? Are they experienced in xeriscaping? Paying for experience can save you money in the long run.
· Cost, financing and project management. Custom home building projects inevitably run into snags and changes that alter the cost and can affect the financing. Work with vendors - realtors, designers, contractors, lenders - with experience in such matters. Before breaking ground on construction, make sure the entire project is priced out with clear advance delineation of how changes are handled in order to avoid surprises. Many builders work on what is known as a "cost-plus" basis, which can be an incentive for cost overruns; better to decide on a fixed fee where the incentive is to stay within budget and schedules. Lenders can be very helpful in this process, building a construction loan and then long-term mortgage package with enough flexibility to cover the unexpected.
The more research the homeowner does in advanced, the more involved the home owner is in the process and it can lighten the load because there are literally thousands of variables at hand in designing a custom home. The designer, builder and lender are going to be partners in the process until move-in day, so it pays to go with experience and with people and firms you can live with - for a lifetime.