The Owner-Builder Book 376
The Owner-Builder Book | |
author | Mark and Elaine Smith |
pages | 314 |
publisher | Consensus Group, Inc. |
rating | 9 |
reviewer | Jeff Lewis |
ISBN | 0966142837 |
summary | How to save money by being your own general contractor. |
So a few years latter when I decided that I could afford a new home, I asked my friend how he had built such an amazing house for so little. He pointed me to "The Owner-Builder Book." When I saw the subtitle to the book, I was a little suspicious: "How you can save over $100,000 in the building of your custom home." I had seen a few too many infomercials making similar promises, but my friend had done it, so I figured that I could too.
Now, a year later, I have completed building my $550,000 home for $320,000. Much of my 41% savings can be directly attributed to this book:
Chapter 1: You Can Save $100,000
Chapter 2: Learn The Wealth-Building Secret
This is the pep-talk part of the book written to give you incentive
to read the next 300 or so pages. This chapter talks about how custom
homebuilders know and use the ideas in this book all the time. Ever seen
an ad for a "builder's own home"? Why are they always the upper-end
homes? Hmm.
Chapter 3: Contractors Aren't What You Think They Are
Chapter 4: You Can Manage Better Than a Contractor
Chapter 5: You Will Profit By Building a True Custom House
These chapters dispel myths about contractors. Hint: A contractor is
very simply a project manager, and usually not a very good one at that.
Among other things, they rarely shop around for better material prices.
They usually use the same lumberyard that they have always gone to. I
saved over $20,000 just by telling my framer that I was going to purchase
the materials from a different lumberyard, all he had to do was give me
the list.
Chapter 6: Conquer Details Room By Room and Save 20%
Chapter 7: How to Get the Subs on Your Side
Chapter 8: How to Build a Budget That is a Powerful Miracle Tool
Chapter 9: Commando Shopping Techniques
Chapter 10: How to Schedule the Work at a Savings
These chapters talk about how to actually save money: The key points are
planning, getting down the details of exactly what you want, (i.e. I want
two phone outlets in every room with two strands of cat5 and coax.), and
make sure to shop around. As an example, I had bids ranging from $5,000
to $15,000 for my electrical. One would assume that with 5G's you would
get less than with 15G's, right? Not necessarily: for $5,000 I got
everything that I wanted, plus I was able to add a bunch of outlets that
I hadn't thought of at the last minute for free cause the subcontractor
was a nice guy. Now I love that TV above Jacuzzi tub.
Chapter 11: How to Make Your Lender Swoon
Chapter 12: Paperwork Before You Begin
Chapter 13: Six Months to Victory
These chapters help you get the paperwork ready that you will need
throughout the process. Remember contracts with liquidated damages and
lien release forms! I only had problems with one subcontractor that my
wife had been responsible to get fill out our contract with and had never
done it. But, luckily their own contract, which my wife had signed with
them, covered most of what we needed. I even got to keep an extra $2,000
dollars because they didn't have time to come back and stain the stairs.
Let's see, $50 in stain and supplies, 3 hours time. Yeah, I'll take the
$2,000.
Chapter 14: Smooth Execution Saves Money and Improves Quality
Chapter 15: Mistakes You Can Avoid And Successes You Can
Achieve
These chapters drill into your head what planning and details mean. I
had one major problem over the course of building my home. The truss
company built my trusses wrong. It took them three more tries and fourweeks to get me a completed set. Because of my contracts and planning, I
cut the cost of the trusses by almost half, but the time hit was the most
damaging. My total time to completion was 7.5 months. I had planned for
6.
Chapter 16: If You Decide to Use a Contractor
The final chapter discusses how to choose and work with a general
contractor if you decide that being your own general is too much for you.
Conclusion
Don't leave with any illusions: this book will not build a custom home
for you. By planning and following through on the information in this
book, you too can build your dream home.
The first page of each chapter is available online at: http://ownerbuilderbook.com/book/Ch1.cfm, and a free CD-ROM with software templates for budgets, contracts, the entire book in MP3 format, and a previous edition of the eBook in PDF format is available. You can purchase The Owner-Builder Book from bn.com. Slashdot welcomes readers' book reviews -- to submit yours, read the book review guidelines, then hit the submission page.
well.. (Score:1, Insightful)
all well and good....... (Score:4, Insightful)
Now, anyone who builds custom needs to remember that there are 3 people important in your project.
You: the owner
The Builder
The architect
Now, if you cannot work together, then it will be a very painfull process. Remember that anything you ask for has to be feasible and buildable. If you develop a good relationship with an experianced architect, and a builder that is used to custom jobs, not just 'tract houses' then you should be fine. Also, remember that you have to live in the house, so make it comfortable, not trendy.
I suppose.... (Score:4, Insightful)
Building you own house doesn't look like a job for a software engineer in my opinion. I'm sure the software deadlines would never be hit if all the engineers here oversaw the building of their house.
Re:Fall Down (Score:3, Insightful)
Very simple (Score:3, Insightful)
This book will appeal to a rather limited audience who has the time and energy to do all this themselves. Despite the savings, most people would rather "take the easy way out".
DIY (Score:5, Insightful)
Most contractors are idiots, I am glad to see this book agrees. Remember when dealing with most "profesionals" that they usually have side deals going. While they are working for you this time, they alwasy work with their people. Their prime interests are not yours. That is why they will steer you towards certain yards and certain sub contractors. Not becuase they are the best or the cheapest but because they get a kick back.
A peice of advice not mentioned, from personal experience. While the contractor and the sub-contractors may be who you deal with they are not the ones doing the work. The work crews are the ones that are acutally attaching things to other things. A $60 investment in pizza or beer dropped by the site one day will pay of huge in the long run. If the crews personally like you then they will take more care in constructing your house and be friendlier to change requests. I have seen crews who had been taken care off take all the bad material out of the construction piles (warped or knotty studs i.e.) and place them to be moved to another site for use simply because the homeowner thought enough of them to bring them coffee in the morning. They put the good materials in this guys house and the crap went to everyone else.
not as easy as it seems (Score:5, Insightful)
Not everyone can do it. Especially if your work and other commitments aren't flexible enough to allow it.
Contractors... (Score:5, Insightful)
Knowing a friend who's father built a quite expensive house. As well as knowing contractors myself. I can attest that this is not always correct. You have to understand that a contractor knows the people to go to, and generally who to trust and who not to trust.
If a contractor can save money he will, but unless he is a bad contractor (in which case he won't be around long), they won't purchase the lowest quality materials just because they are cheap. They try to find a happy medium.
Unfortunately, the biggest problem with hiring a contractor is the fact that you have to pay the contractor on top of everyone else. You have to remember though, that you are paying for the contractors time spent in arranging contracts and getting the right people together at the right time. If you take all of that upon your own shoulders, then you are also taking the stress of finding the right people, controlling them, getting good contracts, etc.
If I had the extra money, and a choice. I would hire a quality contractor (one that had been recommended to me), since I don't have the time or the strength really to handle all of the work necessary for proper contracting.
It is true though, that if you are knowledgable on prices for various products, and services, and are willing to take on the work. It is better for you to do the work then the contractor, since you might be able to find deals that the contractor wouldn't know about due to unforeseen circumstances.
In general though, this sounds like a useful book for people who are willing to put in the effort needed to handle a large project like this. (But for my future $1,000,000+ home that I am planning on buying.
Re:Doing without professional help (Score:2, Insightful)
Hmmm... isn't that the same argument PHBs use to justify choosing Microsoft over Linux?
Re:custome home... (Score:3, Insightful)
One issue with getting a custom home opposed to one that is already there is that you not only have to start paying morgtage/loans on the custom home and the land it's on, but you also have to continue paying rent for several months in wherever you're living while it's built!
Re:Contractors... (Score:5, Insightful)
And the homeowner loses every time, because they do exactly one transaction per decade with the contractor, while the contractor does hunderds of transactions per year with homeowners. Yeah, bad word of mouth can hurt in a smaller community, but when was the last time you heard of a contractor going out of business for that reason?
sPh
That's nice, but... (Score:2, Insightful)
Still, sounds like a good book for those in rural/suburban areas.
How to Build Your Own Custom Server (Score:4, Insightful)
I could save a lot of money by building my own file server too, but then I wouldn't have a support contract to go with it, and getting any warranty work done on it would suck, and would probably result in two companies pointing the finger at each other, saying "It's their fault!"
By the same token, if you go out and buy lumber, and have your framer put it together, and something goes wrong, he may say, "Well, the lumber you bought wasn't so great, there's only so much I can do." Going to the lumber company results in, "The framer must have done something to the wood, that was my best pressure-treated.." If your framer picks out the wood, then you definitely a case and can put it solely on his shoulders.
This is just an example, IANAC (but my brother is).
DIY Disaster (Score:2, Insightful)
Amateur vs. Professional (Score:5, Insightful)
Basically, this book is saying that if you have the skills of a project manager and the time, patience, and persistence to act as your own general contractor, you can save money and get a higher quality house.
No doubt true - IF you have those skills, if the plumber who used to beat you up in high school can't still intimidate you, and if you have the time.
You also need to consider, however, that most contractors/subcontractors in a given area form their own community, and generally will work together to take advantage of any "lone wolf" outside the system. You will also have a difficult time figuring out, e.g., who the good HVAC contractors are vs. the rip-off artists. This is something the general brings to the game that you can't duplicate.
Anyway, have fun!
sPh
Re:DIY (Score:1, Insightful)
Re:custome home... (Score:2, Insightful)
This is not the great depression.
Commerce goes marching on. Besides this is a potential revenue source for geeks with project management skills. That could very well be your Custom Business book.
I feel that it is very applicable.
Re:all well and good....... (Score:4, Insightful)
Owner: I want a big brick fireplace and chimney on the north facing wall of the living room.
Contractor: Ok! Are you sure about that?
Owner: Of course I'm sure! What am I paying you for? To ask stupid questions or to build my house?!
Contractor: No problem then... *makes the necessary arrangements for the fireplace to be built*
*Fast forward a couple of weeks, finished fireplace*
Owner: Y'know, I changed my mind about that fireplace. We decided fireplaces are dangerous so we don't want it anymore. Can you rip it out and just make it look like the rest of the wall?
Contractor: Ummm... sure, but I'll have to charge you for the additional labor and whatnot.
Owner: WHAT?!?!?! I ALREADY PAID FOR THE FIREPLACE AND I DON'T WANT IT! I WANT YOU TO FIX IT FOR FREE!
Contractor: I can't do that.
Owner: Then you're fired! I'll get a new contractor!
This scenario actually happened to my dad. He spoke with the contractor that was hired after him and that contractor said the owner had tried to get him to rip out the fireplace for free and had really badmouthed my dad. That contractor was also fired when refusing to do the work for free.
These are the kinds of homeowners who are total assholes and have no idea what they want.
Some contractors will actually underbid a job, and then plan for the homeowner to change their mind three or four times so that they can charge them huge amounts of extra money based on no-change clauses in the contract. Those contractors love flighty customers, because they can work the same house for over a year and constantly be getting paid.
Kintanon
You want to save money? (Score:4, Insightful)
Every week in our real estate section we can find featured houses that are less than 5 years old, being sold by the people who built their "dream house" only to find that its now too big. IMHO a house that big is like a St. Bernard puppy, you don't realize how big it really is when it grows up, especially the cleanup!
Another pet peeve. Ever been in a 4400 ft^2 house that echos like a gym because the new owners can't afford nice drapes and furniture and art/mirrors to fill the place up?
If you can afford the neighborhood, the taxes, the furnishings, the maintenance and the upkeep of a house that big, then saving $100k might not be that high on your priority list.
My family of 5 live more than comfortably in a 2300 ft^2 house.
Re:DIY (Score:3, Insightful)
Pizza's a good idea, but I'm not so sure about the beer. There seemed to be plenty of that in the condo I bought (I saw empty beer cans all over the place during construction), and now all sorts of construction defects are popping up. All of the roofs were rebuilt earlier this year to fix leaks, there seems to be a fair amount of A/C work getting done in the past few months (my compressor and my neighbor's compressor were cross-wired when the place was built...that was fixed two years ago, but more A/C work was needed this year after the roof work), and there's more than likely some other stuff I don't know about.
Re:Not enough phone lines? (Score:5, Insightful)
Here is a strategy that I think is even better than this for running cat5 and such:
The people who install home security systems tend to be extremely skillful about putting wires through walls. If you are getting a home security system, these people can often put your networking equipment through the walls for a small surcharge, and do it with much more ease than you could yourself. This was how the home my family bought, which was 30 years old and had exactly 2 phone jacks in it, was increased to 22 jacks over 2 lines plus cat5 in all the bedrooms, living room, rec room, plus coax from the satellite in a couple of the bedrooms and rec room as well.
Contracting is HARD and a lot of work ... (Score:2, Insightful)
That said, there are some really bad contracters out there. Some places have huge building booms (Toronto for instance :-) and all sorts of fly by night organizations and people are head contracting these days. Picking a good contractor can be harder that just doing it yourself.
My dad just had a brutal experience last year where he ended up doing a lot of the project management because the head contractor was so bad.
Either way, as somebody else said -- ALWAYS and I mean ALWAYS take the time to buy the guys who are doing the work beer or coffee. Construction guys always do better work for somebody they know and think is an ok guy rather than some anonymous jerk who phones in complaints to their boss.
Re:You want to save money? (Score:3, Insightful)
The real estate mantra is "location, location, location" -- not "space, space, space". If you buy a nice home in a $100k neighborhood you can get just as much (if not more) ROI as if you buy a nice home in a $400k neighborhood.
Frankly, the OP was correct. Evaluate how much space you need, not how much house you can afford. Yes, they drive each other, but there's always flexibility. Too many people wind up in homes that have far more space than they need or can upkeep -- and then complain that they have no free time, money, etc. -- because all the money is being sucked down by their mortgage payment and all their time by the too-big house.
Re:Unemployment is _25%_ (Score:3, Insightful)
Really? Then by your own logic we have a 0% unemployment rate since all of my friends are gainfully employed in our chosen fields. Cool! I love this economy...
I guess what I'm trying to say here is that all statistics are lies, for the very reason that you demonstrated with your own "statistical analysis" of the situation.
Re:Contractors... are more that PMs (Score:3, Insightful)
I agree with the above posting, about contractors being more that project managers. Whoever said that they're just PMs, and not very good ones, obviously didn't work with my contractor. There's even more to it than their relationships with the subcontractors.
I recently build a custom home -- less than $500000 (USD), but not by much. I went with a highly recommend general contractor, who was not cheap.
At first, I was alarmed by how much money was going to the general contractor. But I was way out of my depth, and I was much happier than I would have been had I gone to a tract builder.
Then, the problems began, and I was so glad we had a good contractor on our side.
I can't imagine having to deal with all of these problems myself. Sometimes I wonder if the general contractor even made money on my house, after all the things he had to pay for!
So, be cautious before you think, "I'll do it myself; after all, what good is a general contractor?"
Re:new homes (Score:3, Insightful)
(1) Don't buy in a new development *if* it's geographical/political boundaries allow for massive growth. Do buy if you can realistically predict the limits of the area's growth and the area's economic vitality.
(2) Short term, buy for structure and land. Long term, buy for land appreciation only. You can depreciate the stucture's cost (if you rent it out).
(3) The best thing to do is buy a home near the city, in a neighborhood that is beginning to revive itself. If it's a heap, don't throw good money after bad. Be willing to tear it down and build condos. Take a short-term hit for long-term return.
Re:Living through it - an architectural response (Score:2, Insightful)