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Thread: Buying a house VS Building a house

  1. #1
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    Buying a house VS Building a house

    OK, buying a house is easy enough. You put a down payment, get a loan for the rest and you are on your way. Or in some cases, get a loan in full.

    But if you build a house, how does it work? So you buy the land - that is a good chunk of cash right there. Then do you pay each contractor as they go? So the foundation guy comes in - write him a check for X. Then the framers, write them a check, plumber, write him a check, etc? Or do they build the whole thing, then you buy it from them like a regular house? Or do you hire a general contractor and they hire all of the proper parties for the jobs?

    Financially, which way is more affordable if you know what you're doing?

    Did this explanation make sense?

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    I believe that you get a construction loan that is drawn on as necessary. I don't know how and when you draw on it or when you must start making payments, but they surely charge interest on the amount owed on an average daily basis method until the house is complete.

    The process of approval and supervision by the bank over the process of building is probably a lot more complicated than a simple inspection for a completed house.

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    Quote Originally Posted by Aaron1124 View Post
    Financially, which way is more affordable if you know what you're doing?
    In a lot of areas right now, you can buy a house for less than it would cost for just the materials to build the same house.

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    Plus the expenses to buy the property..

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    Regular Member sudden valley gunner's Avatar
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    Aaron I'm a contractor if you truly are interested I can help you out there are advantages to both ways. Often if you get an honest contractor/consultant it can be cheaper than buying outright. But right now there are many shortsales/foreclosures that are super deals.

    Yes lending on new construction might be a little more difficult especially now though. But it is being done, depends on your credit and work history.

    The loans vary differently, often construction loans are not compounded daily, until it is morphed into a mortgage at the completion of your construction period. Whether or not you are done. A very good thing to do is have enough money to pay as you go, Like you stated and then be reimburse yourself with the bank draw. Keeps everybody happy and often you get better pricing from your subcontractors.
    Last edited by sudden valley gunner; 01-14-2011 at 08:58 PM.
    I am not anti Cop I am just pro Citizen.

    U.S. v. Minker, 350 US 179, at page 187
    "Because of what appears to be a lawful command on the surface, many citizens, because
    of their respect for what only appears to be a law, are cunningly coerced into waiving their
    rights, due to ignorance." (Paraphrased)

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    My uncle designed and built his own house. Did most of the work himself, studying hard and learning on the way.

    Great house! Custom home and it took him about a year and a half to do it, for about 2/3 what it would have cost to buy. I even visited him for a week and helped him!

    That doesn't figure the labor he spent during that time. Factoring that in, he spent more than he would have had he bought a home. It is, however, a custom home, and that's something to consider.
    The First protects the Second, and the Second protects the First. Together, they protect the rest of our Bill of Rights and our United States Constitution, and help We the People protect ourselves in the spirit of our Declaration of Independence.

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    If money isn't a huge factor, I'd say build your own home. Get an architect you trust to draw up the plans, OR buy the software and do it yourself! There are some fantastic 3-D Architect software programs out there that will not only let you draw a house (or modify one of the floor plans that comes with the software), but they'll keep a running spreadsheet of material costs and needs, as well as check for problems like a door that won't swing open because the chimney is in the way! This software is really NEAT, because you can decide to grab a wall and make a room two feet wider, and ALL of the other measurements adjust to the wall's movement, including the roof!

    The OTHER advantage to building your own home is that you can incorporate things into the design like a secret room or a "Safe Room," or a hidden area for storage of a safe or valuables, food supplies, etc. You can also control what goes INTO the walls as it is built. it is a lot easier to put things into the walls BEFORE the drywall and insulation is installed.

    A friend built a home in Utah many years ago. He asked me for my ideas, and I gave him plenty. There was money to play with, and he was VERY happy he followed my advice! He built a BIG three story home with a basement (4 levels total). When I got involved, it was about 60% framed, but no plumbing or electrical had been installed yet.

    I told him to buy a BIG spool of two-lead wire and run it all over the house, to every room and just let the wires terminate at a known location in each room such as 12" over the main light switch or whatever.

    ALL of the wires ran to one small room in the basement. With those wires, he easily hooked up a whole-house stereo system, and an intercom system so he didn't have to shout up and down the stairs to other family members. He HARD-WIRED every door, window, attic access and other entry with another pair of wires, also running to the basement. At the "control center" which was a planned, small room he framed off of the laundry room, he had the stereo, the intercom base, the alarm system, the LAN CAT-6 cables for internet access, the 75 ohm TV cable and more!

    Every room had a length of Romex placed over the center of the room. It just terminated there. The other end ran down to the light switch but was not hooked up. I told him to put a triple outlet box at EVERY location where an outlet or a light switch would be placed. He did. As time passed, he was simply overjoyed at how EASY it was to add a ceiling fan or a light fixture, since the wires were already there and simply removing a blank cover plate would let him put in a dimmer, or a switch, or an outlet wherever he needed one. Rather than messy, ugly extension cords, he'd just add a wall outlet where he needed to plug in more than two things. I told him that outlets and Romex are cheap, so make sure you install plenty of them!

    He also wired the entire house with a separate electrical system. This one ran off of 12vdc, and the deep cycle batteries in the basement sent power to low voltage lighting (L.E.D. technology was only in its infancy when he did this) in every room. He used white truck marker lights mounted over each door. They were charged by an inverter, with a solar panel as a backup. In the event of a power outage, the 12 volt system would kick in via a relay. He could not only light up any room as needed with a small toggle switch below the main wall switch, but the batteries also powered the security cameras and monitor, his Cobra cordless phone (remember those) etc. A generator in a small enclosure outside was added later for emergencies and to recharge the batteries.

    Cellular phones weren't really in full swing yet. this was ... 1991. He wired practically every room in the house with 4-lead phone cable and left the pigtails hanging in the walls behind the drywall. As he found he needed an extension here or there, he'd simply go to the spot on the blueprint, make a small hole, fish out the already existing and wired phone line, and hook up a jack.

    At my suggestion, he recessed all of the bathroom floors, the kitchen floor and the laundry room floor one inch. They were each sealed with fiberglass resin to make a 'floor pan.' A drain hooked to a 1" copper tube ran to the outside of the home from each "wet" room. In the event of a broken water pipe or other flood situation, the water would not escape the room into the house, but rather, it would just pour outside via the tube. The laundry room in the basement was set up to dump the water into the sump pump, which would them be lifted to ground level outside.

    In two of the large bedroom closets, he ran plumbing to just behind the walls and just under the floors for toilets, showers and sinks. The plumbing terminated in the walls and floors, but it was already there. A few years later, when his dad got old and sick, he moved his dad into one of the bedrooms, and split the walk-in closet in half. A little tile was all that was necessary to create another full bath, since the plumbing was already there! He mounted a toilet, a sink, a tub/shower and a mirror, and the project was relatively effortless.

    I told him to run ALL of the plumbing along the outside walls, and design it so that in the event a pipe needed to be replaced, it could be pulled straight out without the need to tear up interior walls and floors. All of his bathrooms and the kitchen were on exterior walls. At the critical points (elbows and joints) an exterior access hole was normally covered by a decorative wood block, but getting at the pipes was nothing less than dirt simple!

    He went against my advice on the bedroom doors and exterior doors. I told him that a solid core door that swings OUT is far more difficult to kick IN. For safety, I suggested he make his entry doors and bedroom doors swing OUT, mounted on security hinges (pins can't be removed) so that if there was an intruder trying to enter the house or IN the house, he wouldn't be able to force his way through a door that swings outward. He opted for a deadbolt on each bedroom door instead, but then he used hollow core doors which aren't nearly as strong.

    He added a few more things. He complained at first, but as he incorporated them into the home, he became excited about how innovative the additions were! He even had a homemade boot drier just inside the front door! When he'd come home in boots covered in snow, he'd place them on the drier and spin a small wall timer. A small forced air heater would kick on. The boots would be warmed up and dried out, and the timer would shut off 20 minutes later!

    Do yourself a favor and put insulation into the interior walls as well. It will help deaden sound for privacy, and if you decide to shut off a few rooms that don't need to be heated, the insulation will help keep your heating costs way down.

    Make all of your doors WIDE. Nothing is nicer than moving furniture into a home with wide doors. 36" and 42" doors are great, but those small ones (28" and 32") always seem to make things difficult.

    If you're going to put a safe on an upper floor, make sure the framing is there to support it.

    Well, now that I've bored you to death, GET STARTED!

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    Regular Member TechnoWeenie's Avatar
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    ..the LAN CAT-6 cables for internet access,..(...)...this was ... 1991


    Cat5 wasn't formally introduced until aug of '91 with 'fast ethernet' or 100basetx not until 1995, and cat5e not until 2001, cat6 in 2002.

    Pardon me for calling BS, but back then, 10baseT was the name of the game (which admittedly looks a lot like cat5,6 to an untrained eye)

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    If you're young enough and/or have the determination to change the paradigms...

    http://www.hollowtop.com/cls_html/limited.htm
    Last edited by Awshucks; 01-16-2011 at 04:08 PM.

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    Lots of good ideas above...

    If your a hunter and have a mount room, underlay the chalkboard with 3/8 plywood...then you can put your mounts where ever and not worry about finding studs for the stud elk.

    Well or public water? Setting the well above the the house (and a cistern), will allow gravity feed of water when power goes out. Alternatively, a 16KW generator that runs on propane can be plumbed and wired in to automatically go on and off in outages with a 15-20 second delay. Work a diverter from the eaves, to allow you to capture rain water is simple and inexpensive.
    Far better it is to dare mighty things, to win glorious triumphs, even though checkered by failure, than to take rank with those poor spirits who neither enjoy much nor suffer much, because they live in the grey twilight that knows not victory nor defeat....Teddy Roosevelt

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    Regular Member sudden valley gunner's Avatar
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    Quote Originally Posted by jt59 View Post
    Lots of good ideas above...

    If your a hunter and have a mount room, underlay the chalkboard with 3/8 plywood...then you can put your mounts where ever and not worry about finding studs for the stud elk.

    Well or public water? Setting the well above the the house (and a cistern), will allow gravity feed of water when power goes out. Alternatively, a 16KW generator that runs on propane can be plumbed and wired in to automatically go on and off in outages with a 15-20 second delay. Work a diverter from the eaves, to allow you to capture rain water is simple and inexpensive.

    Illegal in Washington over a certain amount. Stupid law.
    I am not anti Cop I am just pro Citizen.

    U.S. v. Minker, 350 US 179, at page 187
    "Because of what appears to be a lawful command on the surface, many citizens, because
    of their respect for what only appears to be a law, are cunningly coerced into waiving their
    rights, due to ignorance." (Paraphrased)

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    If you go with this, you should consider a construction contracts lawyer to build yourself an enforceable contract. If your going to be the general on this, you'll have a lot of "subs" that your working with.

    Know the rules....

    My daughter just built a house in another state. The contractor knew that they were going to have some sweat equity in the house. The contract called for a construction managment fee of (some) percentage, on the total cost of the house based on the contruction loan. Seemed Ok at the time, but when the house was done, they ended up in court. The fight was that they had done about 50% of the construction (all the interior cabinets, plumbing, electricity, sheet rock and paint, well and septic)...the construction company essentially did the framing, roof, foundation, concrete and some site work.

    At the end of the job, he presented a $40,000 dollar invoice for the construction "managment"....this was on top of materials and labor cost. (It was a family run deal, the son and a small crew built the frame, the dad was never on the project in 10 months).

    My kid wanted the % of the managment fee to be based on the percentage of the total construction cost that the contractor actually did (and managed) or about $125,000 of the total cost.....and proposed to pay about $26,000....The guy had a construction lien levied and they lost in court and had to pay the entire amount.

    Make sure you know something about contract management and the implications....
    Far better it is to dare mighty things, to win glorious triumphs, even though checkered by failure, than to take rank with those poor spirits who neither enjoy much nor suffer much, because they live in the grey twilight that knows not victory nor defeat....Teddy Roosevelt

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    Regular Member sudden valley gunner's Avatar
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    Quote Originally Posted by jt59 View Post
    My kid wanted the % of the managment fee to be based on the percentage of the total construction cost that the contractor actually did (and managed) or about $125,000 of the total cost.....and proposed to pay about $26,000....The guy had a construction lien levied and they lost in court and had to pay the entire amount.
    That is the best way what I like to do is act as consultant let the homeowner get more of a say than a general contract. It is also less expensive. I usually like to do by the job, but percentage of 10-20% is good and fair, especially since I do much of the work myself.

    Just like any profession there are a bunch of a-holes who are willing to rip folks off in the construction industry. Although these times are tough for us now, I am hoping it weeds a lot of the crappy ones out. Those guys really piss me off.
    I am not anti Cop I am just pro Citizen.

    U.S. v. Minker, 350 US 179, at page 187
    "Because of what appears to be a lawful command on the surface, many citizens, because
    of their respect for what only appears to be a law, are cunningly coerced into waiving their
    rights, due to ignorance." (Paraphrased)

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    Quote Originally Posted by jt59 View Post
    Know the rules...
    I'll second that. My uncle began by heading to the nearest university library and taking detailed notes on everything required and prohibited by code.

    He also came up with some interesting variations for insulation, such as using 2x6 headers and footers in the walls, but interleaving 2x4 studs with insulation for a no-conduction-path solution. Heated crawl space, pre-stressed foundation, and passive solar heating for the winter months rounds out his repetoire.
    The First protects the Second, and the Second protects the First. Together, they protect the rest of our Bill of Rights and our United States Constitution, and help We the People protect ourselves in the spirit of our Declaration of Independence.

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    Quote Originally Posted by TechnoWeenie View Post


    Cat5 wasn't formally introduced until aug of '91 with 'fast ethernet' or 100basetx not until 1995, and cat5e not until 2001, cat6 in 2002.

    Pardon me for calling BS, but back then, 10baseT was the name of the game (which admittedly looks a lot like cat5,6 to an untrained eye)
    You are correct. It wasn't CAT-5 or 6 cable. It was serial cable for the old PCs as I recall. And there wasn't internet access then. At least not as wel know it today. it was Compuserve and C-net, and home based BBS systems. It was dial up BBS world at the time, and the cable was to provide access to the modem, CRT monitors, the DOT MATRIX printer and such from various places in the home. Laptops were only an expensive dream then, though I had several Tandy Model 100s around. I also had an old IBM XT at the time, and a green screen monitor! Remember when homes only had ONE printer?

    Here's a scary thought: Windows 95 was only 15 years ago!
    Last edited by gravedigger; 01-17-2011 at 01:42 AM.

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    Quote Originally Posted by since9 View Post
    such as using 2x6 headers and footers in the walls, but interleaving 2x4 studs with insulation for a no-conduction-path solution.
    That is an excellent idea!

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    Regular Member sudden valley gunner's Avatar
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    Quote Originally Posted by since9 View Post
    He also came up with some interesting variations for insulation, such as using 2x6 headers and footers in the walls, but interleaving 2x4 studs with insulation for a no-conduction-path solution. Heated crawl space, pre-stressed foundation, and passive solar heating for the winter months rounds out his repetoire.
    Depends on bearing above.

    Weaving 2x4 alternately does help tremendously but here in Washington all our exterior walls are 2x6 for insulation purposes. The best for insulation in my opinion is (if you can afford it, but might even out to weaving) spray foam for a 2" layer then a batted insulation.

    Conditioned crawlspaces and attics are going to be the wave of the future yet many local counties don't recognize these practices yet.
    I am not anti Cop I am just pro Citizen.

    U.S. v. Minker, 350 US 179, at page 187
    "Because of what appears to be a lawful command on the surface, many citizens, because
    of their respect for what only appears to be a law, are cunningly coerced into waiving their
    rights, due to ignorance." (Paraphrased)

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    Quote Originally Posted by sudden valley gunner View Post
    Depends on bearing above.

    Weaving 2x4 alternately does help tremendously but here in Washington all our exterior walls are 2x6 for insulation purposes.
    Well, since 4 inches of wood followed by 2 inches of foam is better insulation than 6 inches of wood, I don't follow. That's the whole point beind staggering 2x4 studs on 6 inch headers/footers - it provides better insulation than 2x6 studs on 6 inch headers/footers. There's somewhat less strength, but as studs act primarily in compression, it's not much. There's a significant savings in cost, though, as 2x4s are cheaper than 2x6's. I can't speak too much to that, though, as I'm not sure of the spacing requirements between using 2x4's vs 2x6's.

    Conditioned crawlspaces and attics are going to be the wave of the future yet many local counties don't recognize these practices yet.
    Interestingly, back in 1966, in Florida, I lived in a 1950's-built air-conditioned ceiling (hung ceiling with vents). The original room had 10-ft ceilings. We retrofitted it to an 8-ft hung ceiling shortly after I moved it.

    I hear you though, as it's much easier insulating a single large ceiling "crawl" space against the attic than it is insulating ducts snaking through a hot attic.

    Another consideration foreign to most US contractors, but widely used overseas (and to great savings) is one of thermal mass. "What? No insulation?" most contractors and designers in the US would say. Yet I've lived in two dwellings overseas, one in S. Korea, and another in Germany, both of which had no insulation, just a foot or more of poured, steel-reinforced concrete, and both were very comfortable, while my heating and cooling bills were quite low compared to U.S. standards. In fact, depending on the external day/night thermal swings, as well as year-round temps, one can calculate a long-term thickness most suitable any given climate, while making adjustments based upon concrete.

    Naturally, the best-known thermal mass structures are dry caves, which tend to average 68 deg year round. Of course, most of us can't afford a house-sized cave these days, so...

    These thermals masses are being made both cheaper and more effective by mixing pearlite (a beaded styrofoam) with the concrete. In some locations, the inner and outer sections are solid concrete, as pearlite tends to emit toxic vapors in a fire, but you get the idea.

    I've friends 20 miles to the east who build their quite wonderful and comfortable home themselves in just four months, using earthen banks as walls, and with passing solar heating during the winter. It's a unique, very inexpensive 3-BR, 2-BA design, yet their heating and cooling bills are a quarter what I spend in my 2-BR, 2-BA apartment! Truly remarkable!

    On yet another note, I helped a neighbor in Las Vegas install an enclosure over his heat pumps. It was fed by a swamp cooler during the summer, and via a culvert he installed in his back yard during the winter. We had identical home designs, yet his bills were never more than 60% of mine.

    My point is that conventional US construction has a long, long way to go before we achieve designs or construction methods which are both cheap to build, and far more energy-efficient than they are today, and the old addage that "more energy-efficient means more expensive construction" is false. I have friends with homes, including my uncle's, which blow that pap clean out of the water.
    The First protects the Second, and the Second protects the First. Together, they protect the rest of our Bill of Rights and our United States Constitution, and help We the People protect ourselves in the spirit of our Declaration of Independence.

  19. #19
    Regular Member sudden valley gunner's Avatar
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    One major thing is Code here you have to use 2x6 for exterior walls. In my opinion it is great to alternate but then you would have to buy twice as many studs, one for the outside sheeting to nail to and one for interior drywall to nail to. The price difference between 2x6 and 2x4 not that great, but could add up depending on size of home.

    The better way in my opinion for the conductive break is to use 1/2 of rigid foam on the outside, in the wet northwest done properly also helps protect against, mold, mildew and rot. Plus studies have shown the major heat loss comes from draft, the spray foam is very effective at stopping all drafts in your wall. Then the insulation acts like your blanket.
    Last edited by sudden valley gunner; 01-19-2011 at 10:14 AM.
    I am not anti Cop I am just pro Citizen.

    U.S. v. Minker, 350 US 179, at page 187
    "Because of what appears to be a lawful command on the surface, many citizens, because
    of their respect for what only appears to be a law, are cunningly coerced into waiving their
    rights, due to ignorance." (Paraphrased)

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