Managing a self build is the major area where you can save additional money. The price of a build varying quite considerably by who manages it and who takes the risk of increased cost occurring.
If you go to a builder or major contractor to manage the build for you, you would expect them to increase the prices by around 20% to cover their time and an element to cover the unexpected, although most additional cost will still fall to you.
If you have a package supplier part manage the project for you with a local contractor to complete it, then the management cost is largely hid in the increased package price. As usually to get into this arrangement you will have committed to using the package supplier prior to final drawings and price, the actual cost to you can be drastically higher than if you had maintained more independence.
If the route you choose is to use a projects manager to manage the project for you then you should get far more competitive prices and pay the project manager around 10% of the build price not including the land value. This can be the best route for many as a project manager knows what they are doing, makes sure items arrive when they should and while not being as price conscious as you would be, will know what sort of deals can be obtained. Where the same project manager is managing a number of properties being built on the same site the cost may be negotiated down to 6% to 8% of the combined build cost.
The final option is to manage the build yourself, and while you save the cost of the project manager you will need to be able to be on site regularly or have someone else who can, be able to schedule and arrange delivery of materials and resolve problems that come up. You will also have to liaise with the various craftsmen and arrange with them when each is to be on site. Choosing this option can save you more than the cost of the project manager, in that you are likely to be more critically managing the costs, more aware of the cost of wastage, and perhaps will expect a little more from the craftsmen. As you also have the power to change specifications if an item turns out to be more expensive or just not available you can seek an alternative where anyone else would either have to just pay more or have to consult you prior to a change.
The negative side of managing your own build is that craftsmen may be less worried about upsetting you, so if they get overbooked may let you down rather than a person that will be providing further work to them, you may be played by those who know more than you do so that they may stretch out some jobs if work is slack, and you may create scheduling or delivery problems that could hold up work although we have a solution to avoid this.
Craftsmen on a building site that do not work for you can be completely different to manage than staff who are employed in an office, can be temperamental, walking out on jobs, and the weather may effect what can be done, by who, and when. Although experience in management is helpful you will also find that a mother used to negotiating with teenagers, manages to persuade craftsmen to perform as well as anyone.
About 1 in every 7 hours put into the construction of a home is management time, scheduling, organizing buying, checking.... Anyone therefore deciding to mange their own build completely on their own should therefore check that they can do this and either be themselves, or have someone else, on site just about all the time. Realizing the amount of time required, you will also realize that you cannot expect any craftsman or contractor to undertake the management for you without either charging you or hiding the charge in costs. I would suggest its always better to be specifically charged for it, then you know exactly how much it has cost and can avoid elastic bills.
The combination of managing with a project manager works well if a number of you are doing the same and there is sufficient being undertaken on the site and you all use the same system. To part manage a single site and expect a manager to amuse himself on a site the rest of the time is not ideal and will not make any great savings as the project manager still has to cover his time used. Rather than seek to reduce the project manager cost, it can be better to schedule tighter, so the build is completed quicker and the manager has to spend less time on site and then to liaise very tightly with him, utilizing your project model, so as to monitor all that is happening and be always one step ahead, making decisions as necessary and being available to him as much of the time as you can. One way to do this is to get an additional pay as you go mobile phone that only your project manager has the number of, so that he can always get hold of you, even when you would turn off your other mobile or leave it with your secretary.
Minimizing changes will reduce the cost and speed up the build. There are few valid occasions when major changes are necessary part way through a build, if the projects has been fully prepared before. We frequently hear of some self builders moving partitioning walls about after they have been put in when they can see the size of the rooms, when it should have been possible for them to have resolved this at the design stage, and we within our work books have suggestions on how to make sure the room sizes are as you want at that point.
Most major overspends on projects are not caused by a single large expenditure extra, but a whole series of small changes or additions. Fittings are quite often an area where prices can increase and while each change appears reasonable ,added together many thousands can get added to the project. In some poorly managed projects this is in a way valid as they had no realistic definition and therefore the budget was not set accurately at the start. This can lead to the wrong decisions being made on initial costs and large extra costs being incurred.
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Self Build Homes Club is an international club
and trading title of Self
Build Homes Club llc. Local services
to serve members are commissioned for the club by New
Atlantis International Services Corporation.
All major commissioned companies involved, have New Atlantis trust status.