Some homeowners believe that they can experience financial savings by acting as their own general contractor and expeditor. Instinctively, it might make sense that there could be a cost savings by the homeowner taking on these job responsibilities directly. However, in most instances, the homeowner doesn’t experience any costs savings (in many cases it costs more in time and money). The homeowner also experiences greater stress, accepts greater liabilities, and spends more time than anticipated overseeing the project.
Homebuilding is very complex due to changing technologies and building practices. Professional homebuilders recognize that the home works as a system. If one part of the system is not constructed properly it affects the entire home. The same holds true with the type of materials being used. They must work together appropriately or the home will not perform properly and will likely not be as desirable on the resale market.
You will want a dedicated crew constructing your home – addressing every detail from excavation to finishing touches. It is best to utilize someone who is familiar with the products, the building codes, and the subcontractors supplying the labor.
A home is most often the largest investment people make which is why it should be entrusted to a professional.
The following are areas where a professional builder can save you money:
- Purchasing Discounts – Professional builders are often able to negotiate lower material and labor costs based on the volume of business that they provide to their suppliers and subcontractors.
- Material Take Offs - Professional builders know the amount of materials needed and keep mistakes to a minimum, because extras and mistakes cost money.
- Duplicate Tasks & Job Site Coordination – Someone at the jobsite needs to know construction practices and to physically be present to answer questions so that mistakes are not made. Mistakes cost time and money since trip charges from suppliers and subcontractors add up pretty quickly.
- Delays in Construction Result in More Interest Being Paid – Time is money. Acting as your own general contractor often results in a much longer building time line because subcontractors will typically honor work requests from professional builders first. In addition, professionals know the appropriate lead time from order to delivery and installation.
- Liability Protections – Acting as your own general contractor exposes you to significant liabilities. Factor in the appropriate costs for insurance coverage and risks that you are accepting if someone were to get seriously hurt on the jobsite. Monitor the insurance of your suppliers and subcontractors and know if they have the appropriate coverage that will protect you and others working on your home.
- Time - Cleaning of the jobsite, meeting with the building inspector, and meeting with suppliers and subcontractors all take significant amounts of time during normal working hours.
- Exposure to weather – The longer the home sits, the more exposure it has to the elements. Seasoned builders know how to protect their jobsites from impending heavy rain or high winds.
- Resale – Educated home buyers will ask who built your home and make sure it passes the rigorous inspection of a licensed home inspector.
- Warranty – A homeowner may run into scheduling difficulties with their subcontractors not only during the building process, but also afterwards when scheduling warranty work.
Sometimes the smallest details can make a professional builder the most valuable. Small setbacks can turn into much larger issues if they are not handled quickly, and contractors will spend much of their day smoothing out any wrinkles that arise.
The safe and best bet is to hire a professional contractor and to follow the MBA’s recommendations on how to select that contractor.
