How to Save Money on Your House Build
When time comes to build a home for you and your family, you want to get it right.
You want to create a safe and comfortableenvironment for you and your dearest ones to relax, rest and be happy together. You want to create a space that your family can fully use and enjoy.
You also want to avoid spending more than necessary and here are three powerful tips that will help you a great deal in making the most of your money.
1. Think Long Term
Many make the mistake of starting to ask prices before defining correctly and completely the solution they should build.
As a matter of fact, planing is a very important stage and you should spend on it all the time and money it deserves.
The first step to make the most of your money is spending money.
You should get yourself a good Architect/Engineer and figure out which are the important aspects to take into consideration to end up making economy on the running costs of your new home.
In fact, while you are going to pay the house just once, your Energy bills will come every month for the rest of your life and that monthly sum shall be as small as possible. For this reason you want your experts to choose for you the following:
- the best building envelope you can afford;
- the best heating system you can afford;
- the best lighting system you can afford.
When these three things are chosen correctly, your running costs will be minimum and you’ll have a chance to save money every month.
But what is “best”???
Good question. To answer that we shall consider the way you are going to pay for building your home.
If you are like most people, you are going to get a mortgage from your bank for a large part of the value of the build. As consequence, you’ll have a monthly rate to pay for the next 20-30 years. You can see that your concern should not be the price you are asked to pay now, rather the monthly sum that comes as results of the mortgage you get with your bank.
When you look it this way, you will have to deal with two monthly bills: the mortgage rate and the Energy bills.
“Best” is the solution the minimizes the sum of those two bills.
Your Architect/Engineer shall be able to estimate the forecast Energy bills and suggest good technical solutions to get that level of running costs. You’ll then gather price offers for the equipment they recommend and figure out the investment cost.
When you have those two pieces of information you can compile different scenarios and evaluate which one minimizes the sum of mortgage rate and the Energy bills.
Side note: now that you grasp the importance of this first step, you should understand that asking price offers on a preliminary architectural drawing is a useless exercise. The price is in the details and, in order to give you a realistic offer, your Suppliers need to know exactly what is that you wish to buy.
2. Split the Supply
When planning and requirements are well defined, you begin to understand that it is not wise to ask one single Contractor to do the whole job.
In fact, there are dozens of components in your build and for many of them you want to get exactly the solution you have chosen, with no compromise. One do-it-all Company simply cannot provide you the best price and conditions on everything.
In general, Companies who specialize on one type of product will be able to provide you exactly what you ask for and to make you better price for it. A General Contractor will anyway buy from those Companies and charge his profit on top of it.
So, if you really want to get what you planned and you do not want to pay more than you should, you shall do some homework and split the supply among different suppliers.
This requires some technical knowledge and some project management skills and here are your options to deal with it:
- you are tech-savvy and you have time, so you’ll do it yourself;
- you ask support to your Architect/Engineer (if they provide this kind of service);
- you hire a Project Manager.
The first option will save you the most money at expense of your time. The other options will come at a price but that is in general much less than a Contractor would charge (as a rule of thumb consider 10% for the margin added by the Contractor). So you would effectively save money.
Having built hundreds houses, our warm recommendation is to go for your own Project Manager. Not only this will save you money on the purchase, it will also give you the following benefits:
- quality check on project documentation;
- handling communications with Contractor and Suppliers;
- keep one expert eye on the work of the Contractor and Suppliers;
- save time and troubles during construction;
- deal with unforeseen situation;
- save your time, a lot of it;
- give you the chance to relax.
Getting the step 2 right will save you between 5% and 10% of the total cost of the build.
Make sure you consider this carefully and take time to do your math.
3. Meet the People
Agreements are made with Companies but business is done with people.
The success of your project ultimately depends on how well you communicatewith the people involved in its implementation.
It is extremely important that everyone on the project is working to achieve a common goal and that the expectations of each person/party (goals and roles) are clear for everyone.
One of your priorities shall be meeting the key persons that will deal with your project in the planning phase. This means meeting the Project Manager of each selected Supplier… and yes, that can be a lot of meetings but it is time well invested cause it can help you making a quick decision and move on at a fast pace.
Say one Company offered you a very good price while another Company is definitely more expensive. The smart thing to do is to postpone your decision until you meet the people beind the price. Meet them both (as quick as possible) and spend 30 minutes with the Project Managers. This will give you the extra information you need to make your decision.
Often after this meeting the price is not that relevant anymore because you get a personal feeling of wh would get the job done in the best way.
Tip: make sure you focus on the communication (and technical) skills on the Project Manager and NOT of the Sales Manager. You’ll be dealing with the first, so he is the one who should gain your trust!
4. Choose your Suppliers Early on
Suppliers are experts in their field. Having them on your side will speed up your progress enormously and it will avoid planning mistakes that could cost you a lot of money in later stages of the project.
Keeping this in mind: the smart thing to do is to choose your Suppliers in an early stage, so they can assist you (usually free of charge) in developing your project.
For more tips on this topic you can read “3 Secrets to Build Your Prefab Home in Record Time“… that is a full lenght article about implementing the project at full speed.
For more info or for any request please contact our Sales Team.