Real Estate Investing

So you are ready to build your dream home, and you think you have what it takes to oversee the project yourself. Many a dreamer has thought the same, only to wake up months later, finding themselves eating Ramen noodles under a half-finished roof. For a variety of reasons, custom-building can vacuum up more money and time then you could imagine. No wonder it’s a leading cause of divorce, right?

Still determined? Here are a few things you should know:

Overbudget

Whatever you think your house will cost, plan for more. However long you think it will take to complete, plan for longer. True, you can save up to 20% by acting as your own general contractor, but this can be overrated. For instance, what happens if you don’t know anyone in the building industry and you get ripped off? What happens if you fail to comply with codes and regulations, simply out of ignorance, and must pay a fine? These are just a couple scenarios where a contractor who is in the know can really help you out.

Kiss your free time goodbye

As a general contractor, you would handle all purchasing, scheduling, subcontractor management, etc. Home builders with the skills and experience may choose to save even more money by doing certain smaller tasks themselves like countertop, insulation or flooring installation. This is a tremendous time vacuum. Even without individual DIY projects on your plate, as the overseer you will need to be available around the clock by phone at least. Ideally, you would check in on the job site once or twice daily. In other words, your work productivity and your family life may suffer.

Find the right approach for you

Maybe you’re a paperwork guy, or maybe you’re a muscle guy. Maybe you’re a framer or electrician. Find your niche and help in that way if you want, but essentially just be prepared to manage the daily activity on-site. You are the coordinator, and it generally works out better if you know the subcontractors personally or they were recommended through a friend. More than one home builder has seen a sub leave them high and dry mid-project.

Plan thoroughly

Above all else, fail to plan and plan to fail. Approach your project with a timetable already drawn out, with different tasks scheduled for certain dates along the way. Research the different stages of house building and plan it out like a storyboard. Though upfront planning is important, be prepared and willing to change plans mid-stream. Managing such a large project is all about flexibility, thinking quick on your feet, and being positive, patient and solution-oriented. Don’t get too hung up on the small mishaps here and there. They will occur, but don’t allow yourself to lose sight of the big picture.

Be honest

Push all thoughts of saving money aside and take an honest, objective look at your abilities and skills. Are you a good manager? Do you loathe procrastination? Do you pay attention to details? Do you possess patience and people skills? Are you a good money manager? Are you prepared to dedicate the time needed for such a job? These are the basic factors to consider when deciding whether you should manage your project. If the answers to these questions are yes, then proceed with cautious confidence and enjoy the ride.