It finally happened! One would think I might have mentioned it here a little sooner than now but here she is..
We finally closed on our construction loan last week!!!!!
If you want to see more up to date progress pics then head over and like the Hill Country Homebody facebook page because if I know myself I know I will find it hard to be all official and write up a post as often as I would like to.
I never would have thought the closing process would have been so long and drawn out. It is just a sign of the times I guess.
So before I start posting about the progress and process for building a home I want to share a few things just in case anyone out there is considering going the route of picking a lot and building.
Often times people are picking a lot in a subdivision that provides a specific builder (say...a DR Horton neighborhood) which we have actually done before and then decided we were getting in over our heads and backed out(another lesson learned). In those cases (at least in our case 5 years ago) the process is a bit more streamlined. They have specific lots that specific floor plans will fit on and and of course you pay more for the better lots. One of the perks to going this route is financing. It is just more simple. The builder usually offers financing and you have more down payment options.
If you are going out and searching for a lot to build on there are MANY things to consider.
The obvious one is location.
The things to consider about location are pretty obvious but just to be thorough...
Proximity to STUFF(aka grocery stores, work, schools). Are you cool with time in the car commuting or is it worth it to spend a little more $$ for convenience? You more than likely will have to pay for the convenience but it is a big deal to many. It was important to us for sure. We could have bought more acreage further out of course but we didn't want to dread the drive to work, church, or feel disconnected from our friends. Because of that we will be the "small house" (believe it or not) in the neighborhood. For us that is the way we like it. I'm no real estate expert for sure but personally I think it is good to be the more affordable home in the fancy neighborhood if you end up in an official neighborhood. Which brings up another location issue. Do you want to be in a neighborhood with people nearby or are you trying to avoid having neighbors all together? We wanted a mix of both. It will feel alot like we are out in the country but neighbors are close enough by to borrow an egg from or help watch over our casa while we are away;)
*Now if you know you are not going the big builder in a big neighborhood route you may want to stop here and make sure you can get pre-approved for a construction loan. It's a booger but can be done. As far as I know you have to have some cash. Many banks won't loan for construction without 20% down and there are a few that will do 10% but it seems the days of anything less than that may be over. (more on that in another post)
Another thing we had to consider was utilities. Lack of access to basic services = lots of extra expenses. Electric service, gas lines, waste water and water in general have to be considered. If you are in a more rural area do you have access to water lines or will you have to drill a well? One of the main reasons we chose our lot was because we would have access to a water line at the street and not have to drill a well which is expensive and you aren't necessarily guaranteed to always have water:( Actually that is a huge problem around here these days. Many people are having to spend big $$ to drill deeper searching for water since we have been in a drought for soo long. We unfortunately don't have access to to gas lines in our hood so there will be a propane tank installed (more $$) so that we can have a gas range and more efficient appliances. In our area we have to have a septic system to deal with sewage and that will add about $12 to $15,000 to your final total. As for electric, it's not an issue since we are in an established neighborhood(but of course it does cost to tie into those existing lines) and I don't have a clue what you do if that is not the case. Oh and there is the whole underground vs. overhead electric line issue as well. We essentially will be sitting on solid rock so anytime you have to dig the cost goes up. If your in an area that actually has soil...that may not be as big of an issue.
Once you narrow down where you want to be, and have decided you have access to the resources you need then you can get picky about the lot (that is if there is an option to be picky). For us the lot we purchased was the only one available at the time and it was the next to last to sell in the neighborhood. There are good and bad ways to look at that. One is...well this is our only option here. And the other is: this is an established neighborhood and if we ever need to sell our competition won't be 10 other brand new homes on our street. (We have dealt with that too:( One of the biggest things to consider is "is this lot buildable?"
If it is hard to access, is too narrow for the type of home you want, or has difficult topography(slopes or cliffs and whatnot) then you will be spending lots more dough on materials(in our case we slope a bit and one corner of our slab will have to be 5 feet tall) and I would imagine in many cases labor goes up too. It is just way easier to build on a flat surface! You also have to consider if there are any major water or sewer lines or ancient trees that can't be touched per your city. Again these are things that we've either come across ourselves or heard others mention but I am no expert and I am sure all of these things vary depending upon your area.
Now I'm not gonna lie. I started to get to the point where I didn't want to do this anymore. I was thinking why oh why after all the planning and attempting to have our ducks in a row is EVERYTHING taking so long. We bought the lot three years ago and after sitting on it for a while figured out what we eventually wanted to do with it. We then started the design process about 10 months ago. After an initial design and cost guestimate we made it a little bigger in some spots and then ended up in the end having to shrink things like rooms and porches and take away a metal roof and just all kinds of odds and ends to get it into our budget. I don't know if I have any advice on that part. There are just so many things to consider. We didn't feel like we could even design the house before we had a clue what it costs to build so I would talk to as many builders as possible to get some idea before you pay to design something you can't afford. Our architect did everything we needed and asked him to do. It was more confusion about cost to build in general that made us have to change things which takes time. I would say as far as a time sucker goes though it would again have to be the mortgage process.
Are you overwhelmed yet? I totally am..but I'm hopeful that in the end it will be worth it. Please oh please be worth it!
So after all that waiting.....
we closed and the next day this happened!
And so it began