This article is intended for the DIY (Do It Yourself) home builder; however, it is very useful information for the new home buyer to understand what processes you can monitor even if you are not acting as the general contractor and hiring a general contractor. For the inexperienced DIY home builder, acting as a general contractor is one of the most stressful things anyone can undertake. After that statement, you ask yourself “Why would anyone really want to be the general contractor for their new home?” Well the number one reason is to save money, and in our society it’s all about the money isn’t it? It doesn’t necessarily mean that you are building the home (but with this approach sweat equity has a whole new meaning), you are only managing the sub-contractors.
Successful general contactors are either born good, or have been trained to be good. You, as your own general contractor, do not have the time to be as good as a contractor who makes their living building homes. For this reason, I will give you some guidelines to help you out and feel a bit more comfortable managing your new dream home as your own general contractor:
Define Your Project; I have published an article on very effective ways to decide on a dream home floor plan. I recommend that you read that along with this article. The article is called Home Floor Plan Designing for Your Future Home by Robert Kempe. Once you have decided on the floor plan and all the associated up front planning projects, such as finding the right plot of land, gathering information on building codes and permits, having signed construction drawings, etc. you have to apply for the building permits. With the homework of gathering all this information prior the application process and having your construction drawings drawn to comply with city, county and state codes this process is just a paper work issue. If you have not properly done this entire process prior to the application, this will slow your time frame down considerably. Most DYI builders wait for the building permit application to find out what is needed. Make it easier on yourself and do it first.
Execution of the Project; Now that you have a clearly defined project you can get accurate quotes from the contractors. The construction disciplines you will need are as follows: Electricians, Plumbers, HVAC (Heating Ventilation Air Conditioning), Framers, Concrete, Drywall, Finishers, Painters, Roofers, Siding, Landscaping, Windows and Doors, Garage door. Etc. Keep in mind that most contractors will have multiple disciplines and will try to combine them as much as possible either with their own work force or they may hire out subcontractors as well. This is how you execute the project. Do your homework on the contractors that you will want to work with on your home. Ask people who you know that have recently built homes who they have used as contractors. Actually any resource on contractor evaluation is helpful. Have them evaluate the experience. With this process you can then get three to five contractor references from trusted resources without involving any salesmen. Have a set of construction plans ready for each of the contractors that you are going to have bid from the list you have generated. Make sure that all the disciplines will be bid upon.
Deciding who to hire as your subcontractors; You do not always have to take the lowest bid! You want the contractor that is the most qualified and most prepared to build your home. It is highly suggested that each of the contractors break down the categories and itemize how they arrived at their price. This is best done by communicating this up front before receiving their price. Once you have all this information, evaluate the prices according to their breakdown. Rate the contractor on their responses on a scale of 1-10 with 10 being the highest rank. If the bids are close then it’s a matter of what contractor you favor the most. If there is a large gap in the prices, you need to determine why. This is where your breakdown of the work performed and the associated prices can help you determine this. This is also where you find out which contractors are the most serious and most qualified and which contractors are easier to work with. This might lead you to conclude that the best contractor isn’t always the lowest price. You get what you pay for!
Managing the Subcontractors You thought deciding who to hire as your subcontractor was difficult, try managing them! This is where most of the stress and “sweat equity” occurs. I have been a construction project manager for 15+ years and honestly, every time I am assigned a new project the fear of the unknown working relationships with each of the subs is a major concern. I feel your pain! To help you in your management, have a schedule ready during the bidding war between contractors. Have this presented at the time you present the construction drawings. In fact, have three schedules! What this will generate is three different prices from each contractor. Use this as part of your evaluation as mentioned in the previous paragraph. Your long schedule, medium schedule and short schedule will generate different responses. You want this information up front so that when it comes time to sign a contact with the subs, you can put in clauses that if they do not hold the schedule there are financial burdens placed on them. This will protect you from mismanagement on their part.
After all the schedules and contracts are agreed upon, you become more than the customer, now you are the boss. Everyday you need to communicate with the subs and get an updated detailed report on what, where, when, how and why they are on or off schedule. Manage the project by the schedule. Keep in mind that the schedule will change if you decide to change your scope of work by issuing change orders (example: changing the cupboard or cabinet size, the flooring, or appliance). Keep in mind that during this time, this is a small business and your profit is represented by how close you come to your original agreed upon costs associated with the schedule after the contract signing. We could talk about management all day long. In fact there are training courses on this subject that cost thousands of dollars. Hopefully this bit of information will get you on the right track and help make a smooth transition from concept to actually building your dream home. Remember this rule of thumb, the more you prepare the better you will be when handling the bumps in the road. Gathering information prior to needing it will actually save you more money, time and stress than you can probably calculate.