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It's been a long and arduous journey to get my own home ready for its whole house remodeled and new addition.
In the past couple years the ability to build a new home; remodel an existing one; or add on to one has been burdened with a layer of difficulty. Due to increased material prices; labor shortages; and rising mortgage rates home renovations have seemed impossible.
Personally, I started and stopped working with five different builders and general contractors. Not to mention I reached out to several others. I was Goldilocks! This ones too much. This ones too little. This ones a terrible communicator. In the end I decided to manage the bulk of the project and be my own general contractor.
A few of our failed experiences with builders and general contractors:
And those are only the ones we entered into a mutual collaboration. We met with and received quotes from another dozen companies. We had to kiss a lot of frogs before meeting the general contractor we hired. (I'm not sure why I keep using fable metaphors. Maybe its all the kids rooms I've designed.)
I hope the following information about my experience helps anyone else who might be on a similar journey.
1. TALK A LOT
Throughout the process of finding the right professionals I talked a lot. I discussed city permits, electrical codes, French drains, etc.
I developed a nuanced understanding of what our project required. (I also picked up tons of building terminology. Mainly by nodding my head during discussions and then googling, "what are mechanicals?") Through additional research I learned about each phase of the building process. Who it was I needed to hire to do what job and the money, permits and timing it would take to do each of those. I share links at the end of this post to articles I found most helpful.
At some point in the process of meeting with various subs I was talking to a plumber who suggested that I could be my own general contractor (or GC). I laughed and said probably. The idea of having more control of what seemed to be an out of control process was tempting. Not to mention it would save us tens of thousands of dollars. Daunting, but also doable.
Don't be shy about asking others you know, and don't know, who are going through a home remodel. For example, I learned about mechanical liens from a girlfriend who was adding on a large deck to her home. One of the subs on the project told her he hadn't gotten paid and threatened to put a lien on her home. She had in fact paid for this specific to the main company she hired to manage the project. In turn this company was to pay all the subs who actually did the work. But they hadn't made these payments. Ultimately, she didn't have any sort of protection against this situation. This conversation spurred me to ask my banker about how to avoid such a scary scenario. Our banker suggested having each sub pick up their own payment from the bank and sign a lien release form. To be fare our GC actually had a clause in his contract for a "lien release". This states that neither he nor his subs would be able to put a lien on the house.
2. ASK FOR WHAT YOU WANT
I decided, with the support of my husband that I would in fact take on a large portion of general contracting for our project. I had a list of sub contractors (or "subs") for drywall installers to counter top installers at the ready. It was the actual building of the new addition that I was not comfortable with. I didn't have any solid leads on reputable subs for the key and crucial tasks of excavating, foundation, and framing. Not to mention finding a builder or GC that was open to doing only part of the job. Until I met Matt.
How did I find all these subs and our highly recommended GC? I asked around. On my daily walks with my dog I'd stop at building sites in my neighborhood and introduce myself. I called the phone numbers on the builder's yards signs who's work I liked. I asked each sub I liked if they knew anyone in one trade or another. It was like a wild game of connect the dots.
Eventually, I stopped reaching out to builders and only contacted general contractors. If you google to search home sites like Houzz (which I did) to learn the difference between a builder and a general contractor it would say they were pretty much the same things. Except there can be one big difference that worked in my favor. Typically GC's didn't have designers on staff who walk you through all the finishing selections. And they don't require you to purchase finishes and fixtures through them and then mark them up with a 20% commission. In fact most GC's prefer that the homeowner is responsible for all those purchases. I even purchased things like all the lumber for framing and exterior siding. So we are definitely racking some serious frequent flyer points, but we also know exactly what most building materials cost and aren't questioning any markup by the builder.
Personally, as a designer I hated the idea of wasting money on paying another designer to do a job I would wind up doing anyway. It also meant finding the best prices I can and saving money on many aspects of the home including cabinetry, tile, flooring, lighting, etc. Being my own home's designer has allowed me to get better quality materials for significantly less money. Not to mention I am not paying a commission on top of those products and materials to a builder or general contractor.
3. SAVE YOURSELF
The other big savings of being my own GC is kind of obvious – less payouts to someone for the work I could and want to do myself. Like interior demo and purchasing materials
There are few financial ways a residential builder or GC prefer to work. The main two I encountered are Cost Plus and Fixed Prices. We had decided Cost Plus made sense to us.
Here is a brief explanation of these two most poplar pricing plans:
Cost Plus: An owner agrees to pay the cost of the work, including all trade subcontractor work, labor, materials, and equipment, plus an agreed on percentage amount on all those items to the contractor. Since the contractor is reimbursed only for actual costs, plus a fee for overhead and profit, if actual costs are lower than estimated, the owner gets to keep the savings. If the actual costs are higher than estimated, the owner must pay the additional amount, unless the cost is capped at a guaranteed maximum price.
Fixed Price: A fixed-price contract is a contractual agreement with a predetermined value for the goods or services provided. A fixed-price contract sets the terms of a project and establishes the price of goods or services. If the actual cost of the works exceeds the agreed price, then the contractor must bear the additional expense. If on the other hand the cost of the works is less than the agreed price, the contractor will benefit from the savings.
In today's world of volatile pricing for building materials the fixed price was not popular for the builder/general contractor or the homeowner. For me the trouble with Cost Plus was finding a fair percentage rate of commission. We were presented with percentages ranging from 15-30% for the exact same project. We finally landed on a 20% Cost Plus agreement.
4. USE YOUR STRENGTHS
During covid, and a bit after, the homeowner had little to no ability to negotiate rates on any aspect of the home building process. The supply and demand of materials and labor was so high that merely getting a quote took weeks, even months. (Some ballsy builders even charged a fee for quotes!) Forget about asking for better pricing on anything. One wouldn't dare. But as we entered the end of 2022 things had started to shift. I found some wiggle room for negotiation and quicker response rates across the board. People showed up instead of not showing up and then ghosting me.
Before I ever met with Matt, our GC, I explained to him how I wanted to collaborate. With a GC being responsible for the main demo and build only up to finished framing. I would take over with mechanicals (HVAC, plumbing and electrical) through all finishes (drywall, flooring, exterior siding, etc.). Matt was on board. To be fare he said it was because I was much more prepared and knowledgable about the entire process than the average homeowner. By the end of our first meeting he even offered to work with me as a consultant. This was a tempting scenario as we could save an additional chunk of change on that commission.
Truth be told after a heart-to-heart with myself I realized I wasn't comfortable being responsible for such a critical phase of construction. While I have been responsible for large dollar projects this was my first time in construction. In the end knowing an expert would be on the project would be worth every penny and peace of mind.
These past couple months we finally started our home build, with the demoing of a back room and deck – making room for excavation of the new addition. I will be sharing all the details on our social media and back here on the blog so be sure to following along. Be sure to follow the hashtag #janvrinhome on Instagram not to miss anything!
My patience was certainly tested during the plan drafting phase and the search for a general contractor. As we move into the building phase I have learned a new level of patience and respect for what builders and GC's go through. I also have the knowledge to ask for what I want and not be intimidated by others or the process. My suggestion for anyone considering being their own general contractor is to do your homework and ask lots of questions!
Talk to people in the business, other homeowners and your city planning office. And know while you will be saving thousands of dollars, you will have to invest hundreds of hours. There will be tons of behind the scenes and on-site hours required for your project to go smoothly.
Should you be your own contractor
How to be your own general contractor
Building your own house
Being your own general contractor
Glossary of terms for home building
6 major phases of the home building process
Understanding the different home building contracts
Types of home addition contracts
Free building punch list template
5 ways to avoid a mechanical lien