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Choosing a builder

Old 11-16-2020, 01:02 PM
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Default Choosing a builder

Looking to maybe build on a lot. Aside from the profit and overhead percentage, what questions would you ask a builder to determine if they'd be a good fit or not? Single family residence in SWFL.
Old 11-16-2020, 01:13 PM
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My dad is a custom home builder in NC and since covid has been forced to strictly quote and fulfill jobs using cost +. It's pretty straight forward figuring out profit from there but questioning the amount of money the builder is going to make from building a home is something I don't recommend. I am not implying that you are but figured I would mention it. I would ask the builder to provide some of his previously built homes and even reach out to those that he provides, it's not uncommon for customers to ask for that around here and most of the time folks are more than willing to talk about their experience. Ask about his subcontractors and how he selects them and if they have long-term relationships. All of my dads subs have been working for him for over 15 years and that helps provide a quality product/service. Most contractors around here price out every single job down to the penny and it really shows in their work (quality vs quantity).
Old 11-16-2020, 01:35 PM
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I 'd ask to see a copy of his contract and for some recent build info.
Old 11-16-2020, 01:55 PM
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Originally Posted by FishHuntSurf57 View Post
My dad is a custom home builder in NC and since covid has been forced to strictly quote and fulfill jobs using cost +. It's pretty straight forward figuring out profit from there but questioning the amount of money the builder is going to make from building a home is something I don't recommend. I am not implying that you are but figured I would mention it. I would ask the builder to provide some of his previously built homes and even reach out to those that he provides, it's not uncommon for customers to ask for that around here and most of the time folks are more than willing to talk about their experience. Ask about his subcontractors and how he selects them and if they have long-term relationships. All of my dads subs have been working for him for over 15 years and that helps provide a quality product/service. Most contractors around here price out every single job down to the penny and it really shows in their work (quality vs quantity).
This is good advice. I have been a custom builder for longer than I will admit. Good local references have been our sole source of work except for a few Architects along the way. Some of my customers actually followed our jobs for years making sure we would be what they wanted. I usually would write 6 months - 1 year as build time and never went late.

That was issue of permit to occupancy. 3000s/ft - 6500 s/ft.
Old 11-16-2020, 01:58 PM
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Go see a build that was done 10 years ago...ask the owners....I'd start there.
Design build?
Are you using plans specific to your house?
Architect involvement.... different levels and services..
How long has the builder been at it?
All contracts or some self performing?
Speak to the building inspector... expectations...also ask of the potential builders reputation.
Are you familiar with his subs? Talk to them...
Any previous lean issues?
I'll come up with more....I was a commercial construction project manager for 20 years... little residential...but they overlap...in ways.
Let me rattle my mellon for more inquires you can make..
Old 11-16-2020, 02:35 PM
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Lots of good recs. Cost + may be tough to do with a loan. Check county records to see if he has been sued. Is his contract 10+ pages of small font legalese or short and sweet. NEVER sign an arbitration agmt. or do biz with anyone who wants you to.
Old 11-16-2020, 02:42 PM
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Im in the same situation at the moment. Just closed on a lot, think we found a designer for the house but he is backed out till end of January. Anyway I feel ya, a lot to get done and make good choices along the way!
Old 11-16-2020, 02:48 PM
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When we moved to Montana, we wanted a custom built home. We talked to several contractors, yet none would respond timely, or even listen. Well, I wrote software for civil engineers, so I called a local engineering firm who did construction materials testing, and they recommended 2 contractors that they like dealing with. I knew that the engineers I worked for had problems getting paid, so figured If the contractor was a stand up person and paid their Subs in a timely manner, it was a good sign of their character. So talk to plumbers, HVAC, engineers. If they like the contractor and like working for them, they are probably pretty good. Just my experience.
Old 11-16-2020, 02:49 PM
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Thanks all. Good points all around. Seeing the contract ahead of the game makes a lot of sense.

on a cost plus scenario...is it really as it sounds? Contractor gives you the plumbers invoice plus their percentage? So you see what the contractor is getting charged?
Old 11-16-2020, 03:01 PM
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Originally Posted by sand key View Post
Thanks all. Good points all around. Seeing the contract ahead of the game makes a lot of sense.

on a cost plus scenario...is it really as it sounds? Contractor gives you the plumbers invoice plus their percentage? So you see what the contractor is getting charged?
With your monthly invoices you should receive a copy of every invoice that is included as part of the invoice. Materials, subcontractors and labor (copy of time sheets) etc.
Old 11-16-2020, 03:33 PM
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So a design build...cost plus....WIDE VARIABLE CONTINGENT....
what is they're mark up?
All new correct??
Old 11-16-2020, 03:55 PM
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With the supply chain as it is now,if one is going to start building now they would need lots of patience.
Old 11-16-2020, 04:49 PM
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I'm 19 months into my custom build. My contractor is getting a fixed fee (he does this on all jobs) and I'm very happy I went this route. His fee will only change if I make large-scale change, which I haven't and will not.

In terms of what to ask, consider:
1. Lots of references. And try to get references for new home builds. I have some recommendations for contractors who were doing mostly remodels, and my distinct impression was the skills necessary for remodeling don't include everything you need to build from scratch (especially when it comes to utility installation, setbacks and the like).

2. Ask the references what they didn't like about the contractor as well as what they did like. Also how the contractor handled disputes with the homeowner and the subs.

3. Ask about how the references liked the contractor's subs and whether they seemed experienced.

4. Ask whether the timeframe given proved accurate, and how the contractor dealt with uncooperative subs.

5. Assuming you're paying the costs (whether under a cost-plus or fixed-fee arrangement like I had), ask if the contractor has written quotes from the subs that will be binding and will last a good period beyond when they will be needed (anticipate delays). Same with materials, though those will never be locked in for very long.

6. Again assuming cost plus or fixed fee, ask the contractor if he gets any benefit from the subs including free work on his own projects. You may not get the truth but you can hold his fee to the fire a bit and if there's ever a dispute you can use it to your advantage. I'd get that in writing and also ask the referrals if they ever got the sense the contractor was getting something from the subs.

I'm sure there's more but this is a start. Good luck!
Old 11-16-2020, 06:06 PM
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Great advice here, also MAKE SURE GC pays his subs/suppliers

Seen more than one new homeowner over the years get done and find out they have liens on their new house due to GC not paying everyone as per contract

Have couple GC’s as clients that let homeowner pay directly to Subs and then write check to GC for his P&O and his time, this way you know everyone is paid

Check out financial references as much as current and former customers

Do your Due Diligence

Just me but when you see a GC drive up in high dollar vehicles and has bunch “toys” and lives large BEWARE.

Keep in mind if GC goes out before your warranty is up (varies from state to state on time ) you got nothing to go back on
Old 11-16-2020, 06:25 PM
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Just saying, if you required time sheets from my payroll as part of a contract it means you do not trust me. Then why should I trust you?

On a T+M job I bill based on hours each day for each guy on my payroll each day. If that is not good enough, I will look for the first chance to escape the agreement.
That said, all my new builds were contract bid but I get why cost plus has become almost necessary lately.

Lastly, do not approach this as an adviarsial situation. It can be a lot of fun and very satisfying part of your life.
Old 11-16-2020, 07:21 PM
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Originally Posted by Lprizman View Post
Go see a build that was done 10 years ago...ask the owners....I'd start there.
.
100% this. Also can be done in developments by seeing homes on the market done by the same builder. Everything looks pretty brand new. One developer near me when I take clients into homes 10 years old, they think they're in something built in the 80's.
Old 11-16-2020, 07:32 PM
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big risk to build now due to materials shortages and demand

also even without shortages many builders skip out on finishing and will forfeit the last payment(s)

plenty of THT nightmare threads with builders not paying their subs or for supplies

iron clad contract + tons of due diligence + check references + check state licensing database + proof of insurance/bonds/whatever (AND INDEPENDTLY VERIFY!!! better yet get added as an "interest" on the policy)

Last edited by mystery; 11-17-2020 at 08:58 AM.
Old 11-16-2020, 07:35 PM
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There are lots of ways to go about the finished product in a home, I have done some that are built using the basic Moen/American Standard/Shaker Cabinet projects or a product that is one off creative custom finishes. As a builder I bend over backwards bridging the gap that is normally filled by interior designers, kitchen and bath design studios and other high end professionals that can really contribute to a high cost home. I love to have a finished product that is wow worthy. Its incredibly tough to manage a build and fill those roles but the end results and happy clients are worth it.
Old 11-17-2020, 04:58 AM
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Its really none of your business what the markup, profit and overhead are. Each business is different with different expenses. Do you go to retail stores of any kind asking that? It should not matter, if you are happy with the estimate they give you for the project then who cares how much the guy makes. Asking that is going to be a red flag for the builder that you are going to pain to work with and you will almost certainly get a higher estimate because of it.
Old 11-17-2020, 05:42 AM
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Originally Posted by fandarr View Post
Its really none of your business what the markup, profit and overhead are. Each business is different with different expenses. Do you go to retail stores of any kind asking that? It should not matter, if you are happy with the estimate they give you for the project then who cares how much the guy makes. Asking that is going to be a red flag for the builder that you are going to pain to work with and you will almost certainly get a higher estimate because of it.
This is very common in the industry.....cost plus or design builds for a this contract

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