The Process for buying or building a new home
North Carolina has very stringent building and energy codes and I feel like Craven County, New Bern, and Havelock all have well trained and experienced building inspectors. I can't say this was the case when I started building homes in 1978. At that time building codes were minimal and inspection departments were often not well trained and were understaffed. Things have changed quite a bit since then and today your new home is built to stringent wind and structural codes as well as very high energy standards. In addition, if you build a home in Craven County in a Flood Zone, the house will have to be elevated 2 feet higher than Federal Flood Regulations require.
How to Choose a Home Builder
There is a good selection of licensed home builders in New Bern and finding one to build you a new home should not be a problem. Which home builder should I choose? Good question. As a former builder of new homes below are some of my thoughts.
Experience. While this should not be the only thing to consider it is certainly something you should consider. In new home construction practice does not make perfect, but it does help. A General contractor that has been building new homes for 10 or 20 years must be doing something right. They have worked with many of the area sub-contractors and know which one to avoid. They are also familiar with all the local building suppliers and know which ones have the best quality materials and provide the best service.
Price. Of course the price of a new home is important. That is a given. But did the low bidder include everything the other builders included? Are they using the same quality material? Are their allowences less? The old adage, you get what you pay for, might not be always true, however it often is. Make sure to compare builder specifications carefully before choosing a builder.
Contract. The most important document you sign will be a contract for the construction to build your home. Your builder will no doubt have a standard contract that they use. The contract will likely list, among many other things, the contract price, the draw down of monies, the construction schedule, warranty, insurance requirements, specification sheet, and many other things. Usually a specification sheet is referred to in the contract as an attachment. You should always have your contract reviewed by your attorney before you sign it.
Specifications. The second most important document you will sign is the spec sheet. Here is why. You can buy a front door for $200 or $25,000. How do you know which one you are getting? You can buy a front door lock for $25 or $2500. Again, which one are you getting? Your builder should provide you with a detailed specification sheet that list the type of material included in his price, the allowance of products used, and the construction methods. The spec sheet will also allow you to compare the different Home Builder bids more accurately.
Example 1, There is an $2500 allowance for all kitchen appliances furnished by builder.
Example 2, There is an $18,000 allowance for all kitchen cabinets, bathroom vanities, and counter tops. This allowance includes all labor and material.
Example 3, Foundation footings will be 24" wide with 2 rows #4 re bar and 3000 PSI concrete.
Example 4, Brick veneer exterior walls with Santee Type S mortar. Brick joint will be grapevine. Allowance for standard size brick will be $450 per one thousand.
These are just a few examples. When I was building, my specification sheets were 15-20 pages long. Believe me, you cannot have too much detail. The lack of a very detailed specification sheet can cause you a lot of problems. It is absolutely imperative that you and your builder have a meeting of the minds before you break ground.
Setting a Budget-and sticking with it. This sounds simple. However, from experience I can tell you that 9 out of 10 folks that build a home will go over budget. It seems like allowances and budgets, like world records in track and field, were meant to be broken. The problem is that folks don't realize that there a lot of line items that go into building a new home and if you go over budget by a little on a lot of items it can really add up. I have had customers get mad with me because I allowed them to spend too much during construction and in the end they owed me a considerable amount of money. To try and keep clients from going over budget I use to require them to pay for any overage's on allowances or changes to the house plans, up front. This helped to prevent them from spending money they did not have or could not afford. It is a little more painful to peel money out of your pocket each time you want to upgrade an item. Bottom line, set a budget and stick with it.
Financial Stability. Building a home involves the transfers of large amounts of monies. You want to make sure that your home builder is financially sound. Over the years I have seen several home builders go out of business during the course of constructing someone's custom home. This is a nightmare situation for someone having a home built, especially if it is being built on your lot. Make sure your construction contract list when draws will be paid to your builder and make sure the draws are fair to both parties. When the home is completed, before the final payment, have your attorney provide you with a lien wavier to get your builder to sign.
Insurance. Your construction contract should refer to minimum insurance required to be carried by your Builder. At a minimum he will need a good general liability policy, Builders Risk, and a workman's compensation policy. Builders Risk Insurance insures the house against such things as fire, wind, and vandalism while the house is under construction. Workmen's Compensation protects any uninsured workers in the event they are injured on the job. If a workman is injured on the job and does not have Workman's Compensation your Home Builders Workman's Compensation will cover them. If your builder does not have Workman's Compensation and someone gets injured you could be held liable. Ask your Home Builder to furnish you with a copy of all 3 policies.
Finding a lot to build your new home on.
Keep in mind that the lot you choose to build on will affect the cost of your new home. In some cases it can make a big difference, especially in North Carolina. By all means, check with a builder, or an experienced Realtor, like your truly, before you purchase a lot. It could save you a lot of money in the long run. Below are a few things to consider when buying a building lot.
Building an energy efficient new home.
No one can predict the future, however, if I was a gambling man I would bet that energy cost will continue to go up. With that said, I would recommend at least getting estimates on your new home for some energy saving materials. You might even want to get your home Energy Star rated. Click Here for info on Energy Star New Homes. The pay back for the extra costs could well be worth it. If you decide to not go Energy Star there are still some relatively inexpensive steps to take that will save you a lot in the long run. Extra insulation, Low E-Argon windows, thicker walls, are a few that won't bust the bank. Do some research and work with your builder to see what he suggest.
Want to know if you qualify for a loan. This calculator will help
mortgage calculator © Calculators4Mortgages.com