Is DIY a Wise Choice?
Most people – when they say they’re building a new home – don’t mean they’re literally building it themselves. It’s just an expression. Most of the time, there’s a builder or general contractor handling everything.
Every once in a while, though, a potential home buyer will come to me with the idea of doing it themselves. They want to be their own general contractor.
I understand the temptation. By doing it yourself, you can potentially save anywhere from 10% to 20% on the price of your new home. That’s what a general contractor’s fee usually comes to.
But can you afford the financial risk? You could potentially lose your entire investment. As the general contractor, you’re no longer the customer . . . you’re the boss. For anything that goes wrong, from the trivial to the catastrophic, you have to provide the solution.
Consider the general contractor’s responsibilities:
- Selecting and managing the construction crew and subcontractors, such as plumbers and electricians.
- Supervising construction to make sure everything matches the designer’s plans and conforms to building codes.
- Ensuring quality and accuracy, from making sure the foundation is square and level to checking strength ratings on all materials.
- Tracking all costs, sticking to a budget and paying all parties.
- Obtaining permits and coordinating building inspections.
- Obtaining and maintaining proper insurance, such as a builder’s risk and fire policy.
- Ordering, checking and accepting all building materials and components.
- Resolving problems and protecting against delays or deficiencies.
- Delivering the home with a clear certificate of occupancy.
Realtors may also tell you that your home will be a bit harder to resell, when the time comes, compared to one constructed by a reputable builder.
So, before deciding to serve as your own general contractor, be sure to understand the risks and rewards. For such an important investment, we encourage our homebuyers to use a general contractor. But there are always exceptions.
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Daunia is an Assistant Vice President of Mortgage Loans at the Hastings branch of Heartland Bank. She is a lifelong resident of Hastings with 16 years of banking experience. She enjoys serving the neighbors in her community.
