There are 3 areas to cover in the project planning stage:
Financing- Receive Pre-approval from lender
Land and Site Development- Find lot/land if not already owned.
House- Collaborate with us to build your dream home
Financing:
Because we offer our consultation services free of charge, we like to know that our clients are pre-approved, or have adequate resources to take on a project. It is also no fun to plan and dream about a new custom home only to find out you are not able to qualify – we have learned this the hard way with clients.
Items important in the finance process:
Determine maximum project cost based on conversation with your lender and considering your desired monthly payments.
There are several construction loan types. Be sure you are working with a lender that offers more than one program. Some programs have may have higher up-front costs, but lower overall costs once permanent financing is put in place. Some programs may allow different types of equity which could lower interest rates.
We have lender recommendations at the link on this page of lenders/brokers who have proven they have a good level of knowledge and a good range of programs. We receive no consideration from them for this recommendation.
Land and Site Development:
Land/Lots: If land is not already owned, look for a realtor in your area to start the search and see what price ranges are available.
Site Development budgets vary greatly based on the location (city/county) and individual characteristics of the land. For early (pre-land) budgeting purposes, clients should include $30,000 minimum for site development and $30,000 minimum for utilities or SDC (system connection) fees.
EquityQuest Homes can help you budget for other items:
Lot Slope: steeper building sites have additional costs (foundation, excavation, testing, etc.)
Length of road/driveway to proposed building site
Length of utility trenches (distance of house to utility sources
Water source – public system or private well
Based on depth and other criteria wells can vary from $10,000 to $30,000
Sewer/Septic – public system or private septic system-
Based on the type of soil, septic systems can vary from $7000 to $30,000
House:
The house budget is “backed into” based on what is known about the land.
An example of an early budget looks like this:
$750,000 Maximum project budget decided in conversation with your lender
($225,000) Less lot/land budget
($30,000) Less typical site development budget for excavation and utilities
($25,000) Less City SDC Fees for water, sewer, storm, schools
$470,000 Equals budget for house (foundation up)
It’s a challenge to explain the costs of custom home construction, and we want to gently communicate to potential homeowners that construction costs on a truly custom home are higher than other types of projects. We cannot compete with builders who build a large number of homes using similar plans and materials purchased in bulk. A truly custom home is a one-of-a-kind expression of your personality and your requirements and the process just costs more! Our cost per square foot varies greatly from plan to plan.
We do component-based pricing. We count everything – shelves, cabinets, doors, windows, gutters etc.
We have 117 different counts that we takeoff from all plans to determine pricing.
Most significant cost drivers:
Shape: a square 2-story house is the lowest cost structure. Typically the more “corners” on a plan the higher the costs and the better “street appeal” it will have.
Roof pitch: a standard pitch (6/12) roof build with manufactured trusses if the most cost efficient roof. Higher pitched roofs affect framing budgets, siding budgets, and roof budgets.
Roof complexity: this relates to shape – every corner or nook on a plan adds roof complexity and additional costs which are offset by the increased street appeal.
Windows: windows affect engineering, framing, siding, drywall, and trim. A high number of windows decreases the strength of the exterior wall assemblies against earthquakes so we have to take additional seismic bracing measures in order to maintain structural integrity.
Because we are a custom home builder, we bid out each house individually. We can either draw your plan using our state of the art design system, or we can give an estimate based on bid-ready plans from another source.