4 Tips to Avoid Going Over Budget

One of the hardest tasks a customer faces when building a custom home is trying to avoid going over budget. At some point during the building process unexpected expenses arise, but there are ways to avoid such expenses. Here are a few tips to help budget properly.

Write a List

Many times after the budget has been set and the planning has begun, different design elements begin to unfold along the way. It happens to everyone, but all those little details can add up very quickly. Write a list of the most important elements you would like to see inside and outside of your home. Start with the absolute must haves- down to-would like, but can live without.

Your list should include size of home, number of bedrooms, size of garage and landscaping. Make sure to take time in making the "important" decisions, such as, floor coverings, kitchen appliances, cabinets, countertops and light fixtures. Material cost for these items can vary by the thousands. A little research can save you a lot of heartache in the end.

Land Development

Often when developing a budget, researching the cost associated with developing the land does not get the attention it deserves. Plan ahead and speak with city officials about building permits and the cost to obtain them. Under most circumstances your contractor can assist in obtaining permits and will provide you with most of the cost, but we recommend performing your own research ahead of time to avoid any unexpected expenses or delays in construction.

When selecting your property, research if water, power and electric are already on the lot. For example, it can cost thousands of dollars to hook into utilities, it is considerably less expensive hooking up to utilities already stubbed into the site, than having to go into the street to make a connection, which involves costs not just of digging up the street but also or repairing it. A site with lots of trees means at least some tree removal, which can be expensive and therefore should be part of the budget from the outset.

Always have soil tests done on the part of the site where you plan to build-before you commit to the location and begin building. Finding out during your construction that the area you plan to build on is bedrock or has underground water will throw you off budget, especially if you need to pick a new location.

House Design

Thoroughly review your house plan during the review stage, and make all necessary changes prior to drawing the final plans. Any changes made after the final design phase can be very expensive and can delay building.

Before making any change after construction has begun, talk to your dealer and builder about the real costs-in money and time-of making that change. Some changes are worth the trouble, others are not.

Timeline

An unrealistic schedule causes problems in financing, paying contractors and subcontractors and delivery of materials, among others. Weather for example, is often a factor. Consider whether or not the foundation can be poured before winter sets in and whether the season or region means you must choose a more expensive foundation material or simply allow more building time. Beyond weather, some neighborhoods have covenants, codes, and restrictions that affect design, such as whether your garage can face the street. Build in time to research regulations before designing or building or you may end up paying to have your plans or the home itself altered. Your builder also needs time to file for and receive permits and to research local permitting.

Finally, if your selling another home, make sure you know the real estate market and have built in enough time to sell, especially if you need the money from that home to help pay for the new one.