Um ... that would be us ... just Patty and I
No, we don't have any prior building experience.
No, I'm not even that great a pounding a nail.
No, I had little idea what I was getting myself into.
Basically we got turned on to a concept called UBuildIT, where you basically hire a building consultant for significantly less than a general contractor would cost. You basically do all the work on scheduling the subs etc, but they consult and guide you through. We were going to go with UBuildIt, but had another contact who was just a building consultant ... so we went with him.
He essentially took our detailed plans and then bid out the project to a list of subs that he's worked with in the past. We can choose to either use his subs, or bid them out to someone else. See post on bidding process.
Once that's done he helps you with the building process, but you still end up doing all the work (e.g. scheduling subs, yelling at subs, begging subs, permitting, etc). It's definitely not for everyone, because you have to have a certain eye for detail and know what you want.
Even with a building consultant, there are things that are just missed or done incorrectly. The bad news is that you usually catch them late. The good news is that most of them can be fixed.
There are some significant disadvantages ...
1. YOU'RE A FRESHMAN, EVERYONE ELSE IS A JUNIOR OR SENIOR
Essentially you have to figure that this is the first time that you've ever seen a foundation constructed before, whereas your sub has done it a million times. So you have to pick the right sub that you can trust.
Granted most of these subs are turnkey solutions ... they come in and do the whole foundation (ordering material, setting up inspections, calling the concrete company) - you want that. But that also means that they can hide things pretty easily if they want to. Again, pick the right subs.
If you have a knack for being able to figure out if someone is BS'ing you, then you are halfway there; but remember, you are dealing with people who have been BS'ing for a long time.
2. IT TAKES TIME ... AND IT COULD BE A LOT
You basically have to know as much, if not more, on each aspect of the job than the sub does. I enjoyed it, because I found it fascinating, and fortunately the Internet is an amazing resource. Just talking to subs and asking dumb questions reveals a lot of information - but all that takes time.
Here's an example that shows the time commitment or my general perfectionism ... I stumbled upon a basic question ... what varnish and finish should I put on my exterior wood door. It all started innocently enough as one of my friends was telling about how when he built his house, his general contractor used some crappy cheap varnish on his exterior wood door, and then 2 years later he was calling in a professional and paying $600 to do it right. He still has to reapply the finish every year or so (all products do), but at least the door continues to look good.
Well, fast forward to my project ... 3 hours of internet research into wood varnishes reveals that a finish containing Tung Oil is the best, that certain Marine Varnishes are great, but need to be reapplied, that 'Formby's Tung Oil Finish' contains no tung oil whatsoever, and if you want it done right, you need about $75 in product and several hours of work to protect and finish one exterior wooden door.
Hey, avoid the problem by painting it - but the door is fantastic.
I think there are some significant advantages to being your own general contractor - and for me they far outweigh the negatives ...
1. MONEY.
Even with a percentage fee of the total budget of the house (full disclosure we paid, I think, 4.5% of the total budget we went to the bank with). Some days I was wondering if we were getting our money's worth, but it was a good insurance policy. We were originally quoted 8%-10% for the consulting service, and that's basically robbery.
I probably would have done about 70% of amount of work than if I hired a general contractor, but at least this way I paid less.
The real cost savings however comes from the fact that you are not stuck with one sub. A lot of the housing to be pretty conservative and safe, so general contractors just go to the same subs project after project. What you find is that sub prices vary dramatically ... not only between individual subs, but also based on the subs own schedule. If he's slow, then he'll bid low that month - if he's busy or the project is not really interesting to him (e.g. driving distance, size, etc.), then the price could be significantly more.
Yes, some subs are very consistent - but you have no idea how much something should really cost until you ask a few other subs - more on that later.
2. QUALITY CONTROL
Cold and heartless, but everyone involved in your project has
their own motives - and a surprisingly large majority want to finish as
quickly as possible in order to start the weekend or move on to the next
job. Subs can talk about quality over quantity, but at the end of the
day, you reach a point where it has to be about quantity for them.
Don't get me wrong, the subs we had were by and large fantastic
... but they aren't 100% self-policing. If a mistake means that they
need to spend another 2 hours re-doing it and you won't know because
it'll be covered up by Tyvek wrap ... then the majority aren't going to
fix it.
Don't even count on a county inspector. Nice
guys (or maybe not), but they are going to catch MAYBE 10% of what's
wrong with the house. They aren't going to find out if the panels were
sealed tightly (but an infrared camera will), no one is going to get
down on the floor and make sure the doors sills are all caulked and air
tight - not even your insulation guys do that.
I really don't care how honest you think your general contractor is ... at the end of the day he's not going to be living in your house, paying your electric bills, or probably even building you another house. So what's his/her fundamental motivation in quality. It's not non-existent, but it's not 100% either.
3. DESIGN FREEDOM
We did a lot of whacked out stuff on this house ... water cachement, SIP panels, timber frame structure, fiberglass windows, radiant floor heating, Control4 lighting, the list goes on and on. It was challenging enough to try those things, but it would have been impossible if I had a general contractor that had never done them before and didn't want to try them.
Even if I did find a general contractor who was willing to try those things, he would have had to raise his prices so much to cover the risk, that the project just would not have been possible.
Friends have told me stories of where they would debate for an hour with a general contractor on how big to make the driveway, because the GC didn't want to pay for a couple extra yards of concrete. Could you imagine if I told my GC that I wanted to put up a 150 year old barn with measurements written on a piece of scrap paper? It just would have been a struggle.
Probably one of the biggest compliments I would have to give my building consultant was that he never said, "Holy crap that's a bad idea." Maybe he should have at one point, but everything has worked out so far, keep your fingers crossed.
4. SIGNIFICANTLY LESS FINANCIAL RISK
I admit to adding this in the end (since I was not aware of the problem until some friends and colleagues experienced it), but one concept that is not well understood by 'virgin' homebuilders ... there is significant financial risk in hiring a General Contractor that should be honestly discussed.
The simple fact is that any contract you sign with a GC will spell out specific draws that you must pay once certain work is complete. For example, once the foundation is done, you might need to pay $50K - that is total reasonable.
The issue is that you don't know if he actually paid that foundation company in full - like for the concrete, AND if he didn't, then you could (and most likely) will be held responsible for paying it. A supplier or sub can easily and quickly slap a lien on the new house and hold up your closing until you pay it - think about that when interest rates are going up by the day. There are legal waivers that can be signed (and what banks usually insist on) (and not being a lawyer myself I don't know anything about them), but you have to know your local laws and know if they work for or against you.
Yes, a lawyer might help avoid many of these issues - but if you're building a house and hiring that lawyer means you won't get the tile you had your heart set on - it's not surprising most people don't do it.
And here's the real killer (again, other States or local laws may be different) ... don't think you're going to get your money back from your GC. Most likely, he (or she) is an LLC, which means they can just close up shop and open up under a different name. Sure, they'll have to declare bankruptcy, but the new business is free and clear, and there's no cash in the old business to pay you. And there is really no way to know if this GC is financially stable or not - I've seen GC's in business for 20 years end up declaring bankruptcy.
Again, don't mean to bash GC's - I'm sure there are some great ones. I just know how difficult it is to manage ONE house and its cash flow, I couldn't imagine handling 20. It's easy to see how funds from one house pays the bills of an older house - and it resembles to me a bit of a pyramid scheme.
1 Year Update: I would definitely be my own General Contractor again. I might not use the same consultant (he wasn't very proactive), but I would definitely want that backup from someone knowledgeable. I would say if you're planning a pretty standard house, then you should be OK just buying an existing house or having a general contractor do it. Another option I would entertain is having a general contractor do the shell of the house (foundation, studs, etc), and then you finish the house (drywall, painting, fixtures, etc) - who knows ... there is a bit of money to be saved.
