In this market, after you have your Floor Plan in hand, one of the hardest aspects of custom home building is deciding on a builder. We're here to guide you through the process and share some best practices and tips for making sure that your builder is high quality and won't leave you with unexpected costs.
These questions are designed to be both informative and act as a filter. Builders who are evasive or are not interested in answering these questions should be avoided. Make it clear that you're looking for open lines of communication and to have things done right but be careful not to seem indecisive or needy as this can impact their bid if they judge you to be a difficult client.
Questions to Ask:
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Do they have references? Any competent builder should be ready with references that you can call to get a sense of how their previous home construction clients evaluated their build. Some will even provide for home tours if asked.
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How many homes have they built? Ideally they've built a minimum of about 5 homes, but the more the better.
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How many months on average have their previous builds taken? Many builders will underestimate the build time to make a sale but asking about the average length of their previous builds will be more accurate information to use in planning your move and financing.
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What's their average cost overrun? Again you can use this information to manage your expectations and plan finances.
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What pricing structure do they use? Generally most builders will price a fixed price by line-item but some will price a cost-plus where you pay the cost of materials and labor plus a percentage profit for the general contractor.
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What isn't included in the bid cost? Estimating the cost to build your dream home can be challenging. Sometimes there's sitework, landscaping, certain materials, luxury electronics, permitting fees, taxes, window treatments, basement finished, site utilities, etc. that are not included in the quote. Most builders should include an itemized quote, but just in case it's also valuable to ask them this question so you're not surprised with a huge bill.
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What kind of finishes are specified in the contract? Appliances packages, millwork, casework, window/door quality, flooring quality, hardware and fixtures etc can all have significant impacts on the cost of a project.
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What kind of noise and dust prevention measures do they use? Nothing is worse then starting off in your new home with angry neighbors because you have been driving nails at 4 in the morning and kicking up dust for 12 months.
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What does a material or labor supply issue mean contractually? We've all heard the pandemic horror stories about half finished houses waiting on a variety of materials while the supply chains are backed up or having to pay overages on high priced commodities like lumber. The home builders' contract should spell out exactly who pays in such scenarios and how the schedule impacts will affect financing. Look for symmetry in the contract - if they're going to charge you more if material costs go up then they should also be issuing you a credit if costs go down.
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How much customization is possible and when is the best time to make design choices? Some builders will have a very limited selection while others will build just about anything fully custom. Try to understand that they have to be able to order materials far ahead of time and plan for certain finishes as early as the foundation stage so changing things last minute can hurt your relationship with the builder and schedule.
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Have they built houses in this style before? If your home builder has mostly build only farmhouses, then they may not be a good for for building coastal style homes.
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Have they built houses in this jurisdiction before? Each town/county has its own permitting, building enforcement, and zoning departments. Your build will go much more smoothly if your builder has pre-existing relationships with the officials in those departments since they'll understand what it takes to pass permits and inspections on the first try.
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When and how often can you visit the site? Competent builders should only be limiting your site visits for safety reasons otherwise it's a red flag. If you live far away ask them if they will regularly take pictures at each stage and send them.
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Can I send in an independent construction inspector? This is a good question to ask even if you have no intent of doing this because if the builder pushes back this is a red flag.
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Can they provide sub-contractor contacts? Call some local subcontractors (mechanical, electrical, plumbing, etc.) and ask about how the general contractor is to work with. Check these companies out to ensure that they're well rated, in good standing and licensed/insured.
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What kind of warranty does everything fall under? Many states require that custom home builders provide a warranty. Sometimes the factory warranty on things like appliances will override this.
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How can you be helpful to them? Maybe you can provide a detailed material quantity take-off? Or maybe you can specify material finishes and timeline in advance?
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How is the build insured? The most dangerous time for fires in before drywall goes up. Understand how a fire or material theft is handled and who is responsible for costs.
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When do they get paid? Often there is a regularly disbursed payment schedule but at the end the builder gives you a chance to do a final walk through to evaluate and flag and last minutes fixes before they get their final payment.
Trust Your Gut
Remember, home building is not solely about price. Working with a builder is like getting married - you need to be able to work through disagreements amicably so it's important to interview candidates one-on-one in order to get a sense of whether or not you will be able to work together to come to a fair agreement when issues come up. If the builder is annoyed by your questions at this stage then it's probably a red flag and you should walk away.