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The basics of home remodeling

Building a new home or adding on to an old home is a long process that takes a lot of parts coming together. Oftentimes homeowners don’t know where to start or who to call first in this process, which leaves them spending a lot more money while trying to get exactly what they want from the project. To help them line up the project more smoothly, here are some facts to know ahead of time before starting an addition or new home build project. 

Building up or expanding 

It's generally cheaper to put a second story addition on an existing house than it is to expand out into the yard because you do not have the expense of another foundation. However, consider these variables before making your final decision.

Will your present foundation support a second addition? Whether it is a perimeter concrete foundation or slab, you will need the local building inspector's approval first. As a rule of thumb, a perimeter concrete foundation must be eight inches wide at the top to support a two-story house. If you have to reinforce your foundation before you can build up, compare those costs to a new foundation for expanding out.

Will your neighbors approve a second story? In some areas you may have to get their signed approval before you can add on. The house must remain a certain number of feet away from the neighbor's property. Check if your outward expansion will meet these setback requirements. Expanding out into the yard also reduces your yard space. You have to get equipment into your yard or dig the foundation ditch by hand. Concrete can be pumped to sites that a truck cannot reach.

If you build up, you may have to add bracing to the existing house's walls, which means removing part or all of the siding. Building up means removing the roof overhead for several weeks, and even if it has never once rained in your area before, it will after the roof is off.

Building or buying

Building instead of buying is not for everyone. Having a home custom-built offers many advantages. By working with an architect, you will have an efficient and beautiful home that works for you and fits the building site. On the other hand, building your own home can be a very stressful experience. You may spend more money than if you simply chose a pre-built or existing home. Building is not a perfect science but a learning experience. You may not reap immediate resale value relative to your expense if the right buyer and appraiser are not involved in the sale. 

So if you have found that perfect piece of property on which you would like to build, contact a local architect or designer who is experienced with design and construction issues in your area and can also provide initial site evaluation services. Keep your design and expectations simple and efficient. Your construction costs can vary significantly depending on many factors, which may include your region, the site, the design, local construction activity, as well as other factors.  

Remodeling costs

Labor and material costs vary too widely from city to city, from state to state, and from region to region to give a definitive response to this universal question. But as a very loose guide, plan on paying $80 to $120 per square foot for remodeling construction and $100 to $150 a square foot for new construction. You will be able to refine this figure significantly once you enter into serious discussions with a contractor. 

Hiring an architect

For larger projects, we strongly recommend that you hire an architect or designer before you hire a contractor. You'll save money as a complete, well-defined plan means the contractors can bid accurately and competitively, typically saving you more than the added cost of the design work. You'll improve quality control during the construction process because an independent third party—your designer—will be monitoring the progress of the work. You'll get a better design. The benefits of excellent design input should not be underestimated. You'll be living with the results for long time, so don’t shortchange yourself.

There are alternatives, depending on your own expertise and the amount of time you can devote to overseeing the construction project. You may opt to buy an hour or two of a contractor's time to help define your thinking, pull all the living spaces into a cohesive form and then finalize these ideas. Keep in mind that plans must be drawn, submitted, and approved by the building inspector's office before you can begin a project. Depending on the project's complexity, decide who will draw the plans: you, the contractor, or an architect. 

Another value of an architect is that he or she can not only draw the plans and shepherd them through the approval process, but also can oversee all the construction, ensuring it is done right. They can be your right hand throughout the remodeling project, so all the stress isn’t on you. 

Architects will generally charge between four to 12 percent of the construction costs or hourly, depending on the extent of the remodeling project, along with a service fee for drawing up the plans. They come on to the project a lot sooner than the contractor to help prepare for the project, so that’s why they usually charge a set fee for their services in addition to a percentage of the construction costs. Discuss what their fee will be and talk to more than one. Find one that you will be comfortable with throughout the entire process. You don’t want to be stuck with one who draws up plans you don’t agree with or doesn’t do the job right. 

Questions to ask a contractor 

You will want to find out how busy he is and how he intends to supervise your house. Will he do it himself or rely on a superintendent? How many jobs does each person run? What type of contract does he usually use: cost plus, lump sum? Is he used to building homes of the quality you hope to build? Most builders have some standard building products and methods they insist on. What are his? What type of warranty does he have? Ask about his license and insurance and that he provide you copies of them. References should be checked. Did he finish past projects on time and within budget? Was he reasonable to work with? How often did he have job meetings? Did he keep a clean and safe job site? Why should you choose him over his competitors? Look at samples of work and ask about budget ranges for certain types of projects. 

Self-contracting a remodel 

Being a self-contractor is a step taken by many with the idea of saving money. You may save money, but you must weigh that against the innumerable headaches and delays you will incur as a presumably inexperienced builder. You need to line up a crew of people who know what they are doing, someone to oversee that crew every hour, pay them, and complete all the tax forms. You have to get all the permits sufficiently in advance that work does not stop while you wait for a permit. You have to line up all the subcontractors: electrical, plumbing, painting, drywall, etc. It is almost a full-time job unless you have a construction superintendent you trust to do all this work on his or her own. Here's one contractor's view: 

"I believe the best thing you can do is to pay a contractor as a consultant. That way you make the calls, etc., but he supplies the subs and suppliers. I charge 20% on my contracts and often I can buy materials and subs for less than you and add the 20% and still be under you. You will find there is a difference in pricing between a homeowner and a contractor. Suppliers expect numerous projects from me a year and only one from you. As most discounts are based on annual volume, it all makes a huge difference. What if an employee is injured on your job—make sure you are paying all required insurance on each of your employees. Sales tax as well if your state requires it. Also make sure you have appropriate insurance for the project. You will want a builder's risk package as well as a general insurance umbrella in case someone accidentally gets injured on the site [not a worker]. You can do it, just protect yourself and your assets by doing it right. If you choose not to hire a consultant, make sure you seriously check out referrals on everyone that might work on your job and contact your local building department to learn what is required. Talk to your insurance agent."

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