This is a dream of ours, but sometimes I wonder if it makes financial sense. I tend to think that unless you can act as your own general contractor or do some of the work yourself, you're better off financially buying an existing home. Those of you who have built; do you have any advice on how to do it affordably? What would you do differently or the same if you were to build again?

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I'd like to hear this too, since DH and I plan on building a new home in 5 years or so, him being our own GC, and doing a lot of the work with our own hands! From what I've seen, here, it makes more sense to build on your own. I can't wait!!! Now we just need to save bookoo money.

My husband was the general contractor on four spec homes in the early 90's in California. If you can general it yourself and are in a high cost real estate area, your house should be worth approximately 100K more than you have in it if it is approx. 2500 sq. feet. This also works if you are owner-builder. However, you had to get your lot at a good price. This is assuming you will do most of the painting (inside and out with the electric sprayer). I am not factoring in doing carpentry, plumbing, electrical work, etc.

You will not make this sort of money if you hire a general contractor. They will generally bid on the house per square foot (will cost much more than if you owner-builder it yourself.) However, in a high cost real estate market, hiring a contractor can sometimes be cheaper than buying a house. If you are in the mid-west, deep South, and some other lower cost real estate markets, in most areas of those regions, you can buy an older pre-existing home much cheaper than the building costs for a new one. If you don't know what you are doing, I don't recommend it. One big mistake can cost you $20,000. That is why people often hire contractors - to avoid making several costly mistakes in just one house (which I have seen happen).

We are currently in the best of both worlds. My husband has been a general contractor, but a good contractor is in our church and is going to give us a price break with my husband doing part of the general contracting work too. We have peace of mind for not much more than it would cost for my husband to do it all by himself. (His current job keeps him too busy to do all the work being an owner-builder would require.)

We built our dream home here in the southeast. We were not in a high cost area. We interviwed and got quotes from 3 GC's and went with the one that presented well and charged per job, not per square foot. He made a flat $15,000 for the entire job and was paid a part of that with each draw on the construction loan with the last payment made after the OC was received. It was did not help him any if we went with high-end finishes or builder grade finishes; he didn't make a dime off of what we chose to use (except that I'm sure he got "kickbacks or other compensation from some of his subs and such). I think the key to building a home and what made this a pleasant experience for us is that we had control over how much we spent. It wasn't like we went with a developer who charged for "upgrades." If we wanted crown molding, then that came out of our construction loan that we took out.

We didn't do any of the work ourselves, but we paid for somethings out of pocket. For example: we found a great deal on tile for the foyer and bought most of the light fixtures on clearance. We came out with a good deal of equity when we closed on our conventianal mortgage.

Dh was working nights at that time so he was able to "check in" on the job site everyday.

Unfortunately our circumstances changed and we had to sell the home & relocate, but we fully intend to build that home again and we think we learned enough from our experience to be able to build it even less expensive this next time around!

We had much more instant equity in that home than we do now with purchasing an existing home.

HTH

We didn't literally build it. We chose a model and modified to our specs. Then the builder built it with our specs and choices of upgrades. I would do it again, with a reputable builder (which, thank God, ours was), and our own inspectors, as the city ones miss so much!

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