You might be considering whether to hire a contractor or to build your new home yourself. This can be a tough question. There are excellent reasons why building it yourself can be worth the challenge.
Managing one's own building project can be exciting but it can, at the same time, be risky. There are booby traps which, if not handled, will siphon away any savings. Considering being your own contractor? Here are some pros and cons:
Pros
Since the Contractor must make a profit you can expect that he will charge fees ranging from 15% to 25% of the total sum of material and labor for the project. Saving this fee would be the first major advantage to being your own contractor.
Control - A building project involves dozens of workers. As contractor you are boss. You work directly with these people. You make special requests and assure the work is done to your own standards. Owners can often spend more time on the job than the professional contractor.
Changes can be easier to make - During the building process you will likely come across deals and opportunities for excellent purchases, possible design changes, etc. While under contract with a contractor these can be done but can be more of a hassle. As your own builder you will find that changes are easier to make.
Pride - I don't know about you but for me I feel pretty good after finishing something big. Few projects we will undertake are as big as building our own home ourselves. That feeling can make the entire venture worth every drop of sweat.
Cons
If you're financing your home, banks will not like it. Regardless of your experience, banks want the job done through a licensed construction company. There are many reasons: Owner-builders can involve the project in activities that the banks can't condone ranging from "under the table" deals with unlicensed sub Contractors (resulting in lack of warranties, shoddy workmanship and many other problems). Additionally, the inexperienced builder is will likely to miss and allow errors to occur that are expensive to fix or are ignored and covered up. This can reduce the value of the home. Unless you are looking to finance your own project, being an owner-builder will be a problem.
Lack of Awareness due to lack of experience can be a problem. A professional (this applies to any field) will see things that the less trained will miss. Years in the field will give the professional builder the ability to see situations that may not even be problems now but will turn into problems in the future. The avoidance of those types of problems is a big part of what a builder does. Missing these can be expensive.
Some sub contractors and material suppliers take advantage of inexperience. They may provide bids for services and products that are not complete - then charge extras later when you discover that a vital aspect was missing. Also subcontractors know that it is often more difficult to deal directly with owners due to inexperience as well as a "this is my baby" attitude than can be burdensome to them. Prices of materials and labor can be higher in the long run - eating into any savings.
The time it takes to build (your time managing the project) is significant. As builder you will be getting bids, managing contractors, you will be doing materials lists, checking deliveries, monitoring the work, handling problems, running for materials, getting inspection and handling inspectors. If you are not working or are retired this may not be a factor. But just remember that this will take lots of time - and only you can judge that impact upon your life.
Summary
So - let me tell you my opinion on this. I've been in this business for over 30 years and have been or worked with Owner-Builders and Contractors. I've concluded that more often than not there is little money saved acting as you own contractor. These days (2011) there are good deals to be had and it is a good time to find a contractor to build your home for reasonable fees. He or she will know where the deals are. Most are honest and capable - especially those who are hanging on during tough times. The contractor's fee saved will likely be lost in unforeseen ways, so it is advisable to work with an experienced contractor.
It is not a question if you CAN build a home yourself. The question is - SHOULD YOU? In my opinion, the answer is usually, "No". A licensed and experienced contractor will prove worth his or her fees and will save you money and headaches in the long run.
Managing one's own building project can be exciting but it can, at the same time, be risky. There are booby traps which, if not handled, will siphon away any savings. Considering being your own contractor? Here are some pros and cons:
Pros
Since the Contractor must make a profit you can expect that he will charge fees ranging from 15% to 25% of the total sum of material and labor for the project. Saving this fee would be the first major advantage to being your own contractor.
Control - A building project involves dozens of workers. As contractor you are boss. You work directly with these people. You make special requests and assure the work is done to your own standards. Owners can often spend more time on the job than the professional contractor.
Changes can be easier to make - During the building process you will likely come across deals and opportunities for excellent purchases, possible design changes, etc. While under contract with a contractor these can be done but can be more of a hassle. As your own builder you will find that changes are easier to make.
Pride - I don't know about you but for me I feel pretty good after finishing something big. Few projects we will undertake are as big as building our own home ourselves. That feeling can make the entire venture worth every drop of sweat.
Cons
If you're financing your home, banks will not like it. Regardless of your experience, banks want the job done through a licensed construction company. There are many reasons: Owner-builders can involve the project in activities that the banks can't condone ranging from "under the table" deals with unlicensed sub Contractors (resulting in lack of warranties, shoddy workmanship and many other problems). Additionally, the inexperienced builder is will likely to miss and allow errors to occur that are expensive to fix or are ignored and covered up. This can reduce the value of the home. Unless you are looking to finance your own project, being an owner-builder will be a problem.
Lack of Awareness due to lack of experience can be a problem. A professional (this applies to any field) will see things that the less trained will miss. Years in the field will give the professional builder the ability to see situations that may not even be problems now but will turn into problems in the future. The avoidance of those types of problems is a big part of what a builder does. Missing these can be expensive.
Some sub contractors and material suppliers take advantage of inexperience. They may provide bids for services and products that are not complete - then charge extras later when you discover that a vital aspect was missing. Also subcontractors know that it is often more difficult to deal directly with owners due to inexperience as well as a "this is my baby" attitude than can be burdensome to them. Prices of materials and labor can be higher in the long run - eating into any savings.
The time it takes to build (your time managing the project) is significant. As builder you will be getting bids, managing contractors, you will be doing materials lists, checking deliveries, monitoring the work, handling problems, running for materials, getting inspection and handling inspectors. If you are not working or are retired this may not be a factor. But just remember that this will take lots of time - and only you can judge that impact upon your life.
Summary
So - let me tell you my opinion on this. I've been in this business for over 30 years and have been or worked with Owner-Builders and Contractors. I've concluded that more often than not there is little money saved acting as you own contractor. These days (2011) there are good deals to be had and it is a good time to find a contractor to build your home for reasonable fees. He or she will know where the deals are. Most are honest and capable - especially those who are hanging on during tough times. The contractor's fee saved will likely be lost in unforeseen ways, so it is advisable to work with an experienced contractor.
It is not a question if you CAN build a home yourself. The question is - SHOULD YOU? In my opinion, the answer is usually, "No". A licensed and experienced contractor will prove worth his or her fees and will save you money and headaches in the long run.
About the Author:
Ken Risley, the Engineer Designer, is author of many building and design articles. He provides expert help in planning, design, engineering and construction plans and can be reached through his website.
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