Being your own General Contractor

   / Being your own General Contractor #1  

Nissan197

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I will be starting to build a new house hopefully in April of next year. I have been thinking of being the general contractor, but am not sure. I have had friends who have no building experience like myself successfully build a house being the GC. I have asked several people and its about half say it is easy to do as long as you are organized and are not afraid to tell the subs what you think or want. The other half say it is time consuming and to pay the extra 15% (est.) to have a hired GC. The thought of saving some $$ to put towards higher end items in the house is very inviting, but again what if that extra $$ goes away due to me not having any experience and mishaps occur.

I went to a homeshow last month and there are now companys who will assist you being your own GC. There is a charge, but from what I hear it is about half of a GC. Supposedly they will assist you with getting documents, subs, loans, etc.

I am looking for some advice and opinions from people who have been through a similar situation. Thanks.
 
   / Being your own General Contractor #2  
Nissan197 said:
I have been thinking of being the general contractor, but am not sure.
Been There Done That. But I had previously worked as a carpenter, observing how my employer handled subs. My project was a second story add-on to my home.

The first crisis came when the framing sub had a truck load of lumber delivered, (10,000 pounds?) and was starting to stack it all up over the existing ceilings, before he started reinforcing the foundation as required in the plans. Some previous partitions were now to be load-bearing walls and needed foundations built under them. He said he had passed city inspection on the tearoff and I owed him the first progress pay at that point.

I refused payment and said that weight would crack the lath & plaster ceilings if he hadn't completed the foundation work. He replied I couldn't refuse payment, it was payday and also the last day to pay his insurance before it was cancelled, and he had no other funds aside from this progress payment. I told him in front of the employees that wasn't my problem, I wanted to see foundations before I would make the first payment. I thought he was going to slug me.

If you are comfortable exercising this sort of control, then its worth 15%. If not, that 15% is well spent on peace of mind.
 
   / Being your own General Contractor #3  
California said:
If you are comfortable exercising this sort of control, then its worth 15%. If not, that 15% is well spent on peace of mind.

The same approach needs to be taken with the GC. If you can't stand your ground with the GC, you are screwed.
Bob
 
   / Being your own General Contractor #4  
A GC working on 15% of the total project price??? No way that is happening in NC lately. You had better ask around some more. Your potential savings could be closer to 20-25%. If you are organized and can get the construction loan approved before you spend any money, then you can easily save $40-50k on a $200,000 project. However, you will definitely EARN that money. The GC goes through dozens of headaches, delays and aggravation. That is why he wants so much money. You will endure those same headaches, but be able to build a $200,000 house for $150,000 and have payments that are several hundred less per month.
 
   / Being your own General Contractor #5  
The answer is not simple and will vary according to local building conditions.

On your own you are last on the list for sub's as you take back seat for their major employers. This means you may have a time line coordination problem that can add to final costs.

The other factor is how busy is the construction industry in your area. If it's slack you will have an easier time with the subs.

Next is your knowledge base of structural codes etc. , being able to handle contracts and payouts. Knowing that all materials bought by contractor have been paid for or you end up paying twice.

Then you must consider all aspects of permits, codes, inspections and how knowledgeable you are with these. Every year this aspect gets more complicated.

Next, how familiar are you with ways in which the contractor can cut corners. Reputable ones don't but there are some that may.

As for hiring a company to help set up things at 1/2 price of of a General contractor I think I'd forget that option.

Also note that some contractors may get a rebate from their suppliers or be able to buy more cheaply in bulk.

And I do believe there are many more issues involved of which I am not familiar with. Some could involve collusion between inspection and contractor but this is just a wild guess.

Now can you do it yourself? Yes you can and you can save money. Just be aware of the pitfalls and your ability to handle them.:D

In my wasted youth I worked for a general contractor. [Very large international firm] My son is a Geo technical Engineer working for a consulting firm. The day I knew he knew his stuff was when he made a comment on some well know shortcuts the contractor may try.:D
 
   / Being your own General Contractor #6  
I will be glad to give you my input.

1 Being your own general contractor. One of the problems I percieve is getting subs to work. If you hire a sub and he is working on your house and a general contractor that builds hundreds of houses needs him to go work on one of his projects guess who waits. If a sub does not show up to do his work most GC have someone waiting in the wings If your electrician dont show up for instance that is going to throw off the sheetrock guys then the painters etc. A second problem is getting a contract with the subs. Read some of the posts on here especially one about trouble with a contractor started by 40k chicks. He had a big project going on the electrician started out saying no more than $60K about a month into the project the electrician said might come in at $80K the final bill was $137,000.00. Have all subcontractor bids aproved by an attorney. The biggest scare is workmens comp. A GC has workmens comp. In most states workmens comp limits the amount an employee can sue for. If you dont have workmens comp and someone gets hurt you are the fall guy for however much he can get a jury to sign off on. Most good GC require all subs to provide proof that they have wormens comp for their people. A good attorney can help you with that issue and tell you what to look for. A few hundred dollars for an attorney now could save you a lot of money in the long run.

2. Hireing a General contractor. Beyond any shadow of a doubt. If you hire a general contractor get a very good attorney. I cannot emphasize that enough. My wife is an attorney and used to do civil cases. You would not believe all the horror stories she told about problems with General Contractors. She had one case where the contractor charged 20 per cent more after the house was finished. When she finally pinned him down on a reason he said it was because he did not realize that the house was two story when he bid it. She asked him what part of two story did you not realize. The blueprint where it said first story, or the next page of the blue print where it said second story.

Whichever way you decide ask around and hire a reputable attorney. They might save way more than you pay them in the long run. If 40kchicks would have had an attorney look at all his subcontractors bids he would not have the problem he is having now.
 
   / Being your own General Contractor #7  
Nissan197 said:
I am looking for some advice and opinions from people who have been through a similar situation. Thanks.

I'm doing it right now and got my 1st taste of dealing with a problem sub. One big disadvantage of being a homeowner GC is that you have a greater potential of having problems. They will try to take advantage of your inexperience. you have to work a lot harder than a pro GC. However, it's better to deal with a bad subcontractor than a bad GC. If you hire the wrong GC, you will be stuck for a lot longer and harder to get rid of him. A bad sub is a smaller setback and you can quickly adjust your schedule and move on. My decision to not hire a GC was to diversify my risk rather than saving lots of money. I have a friend with a house halfway built for 3 years now and still in legal battle with his GC. Most residential construction GC don't make the kind of money everyone thought they made. If I'm 100% sure I can get a good reliable GC, I would go with the GC route.
 
   / Being your own General Contractor #8  
Also if you become the GC keep in mind that it is a full time job for those who do it for a living. You need to be at the job each day to check on how the work is going, who showed up and to answer the questions that each sub will have. Not all day but you do need to be there and also available at anytime problems come up. Subs will not wait for hours until you get out of your meeting and are available. They will move on to another job so the crew can be paid that week.

Houses are built in a very specific order and it is your job to know and schedule that order. Sub B can’t do their job until Sub A has done his. The GC will also have to take care of the endless number of tasks that fall between Sub A’s responsibility and Sub B’s responsibility. Many of these will be minor tasks but that block of wood to mount the railing to is a real problem if it was not done before the sheetrock went up. And don’t forget job site clean up. For some reason Sub’s almost never feel it is their job to clean up after themselves and the GC generally does that.

You can do it if you are comfortable with you knowledge of the process, your organizational skills and your flexibility. It can be cost effective and rewarding or it can go 180 degrees the other direction. One thing for sure though, it will be an adventure.

MarkV
 
   / Being your own General Contractor #9  
MarkV said:
One thing for sure though, it will be an adventure.
Don't forget to consider stress as a major non-dollar cost of your project.

Urban legend in the neighborhood where we added the second story was that not one of our neighbors' marriages had survived a major remodel like ours. (1,000 sq ft second floor added to 1,400 sq ft house.) But we are still happily married 20 years later!

I'll share one trick that helped: I didn't let anyone cut through the existing ceiling for the staircase until late in the project, long after the upstairs was enclosed and it was time to install sheetrock. Keeping the chaos of construction out of our living space preserved our sanity and patience - and safety, with two impulsive preschoolers underfoot.
 
   / Being your own General Contractor #10  
I'm a GC on a small scale. I don't get into custom homes or high end projects, but that's just me.

Most home owners don't understand the process and steps you take to build a home, nor how to time when each sub should be there. That leads to allot of frustration in having a house sit there waiting for the next sub to show up. Some subs work good together, others don't. It's not a good idea to have too many there at the same time since they will just get in each others way and not get anything done. It's a balancing act when done right.

Price of materials can vary allot depending on who you buy from. Price out materials before you do anything. In my area, allot of builders use a particular company that is the most expensive for materials. They have fantastic service and will deliver what you want, when you want it, but you pay for that service. The supplier I use has the lowest prices, but you have to plan ahead a little.

Most subs wont pick up anything they throw away. They will trip over cut off and junk all day long for the simple reason they feel clean up is benieth them. It doesn't matter how close you have a dumpster, they will not take one extra step to use it. They will also through away a perfectly good piece of lumber if they put one nail through it and realize it was a mistake. It's easier for them to toss that board than to pull the nail and re-use it.

If you don't know what your looking at, it's real easy for them to cut corners or do a sloppy job. They are paid on how quickly they can get the job done, so if you don't know how the building is supposed to be built, they will do what it takes to pass code, but that's it.

NEVER PAY until you pass code or they are totally done with what you hired them to do. Once paid, you will never see them again. Subs are very good at answering the phone for new jobs, but impossible to get when you have a problem.

Allot of them will be broke the day they show up to work. It's just they type of people you deal with. They will want some upfront money. NEVER give them any upfront money. If they want to buy materials, it should be on your account or theres. If they don't have an account, than red flags should be going off in your head. My cement guy is a drunk. He's very good, but he likes his beer way too much and as a result, he's always broke. When he shows up to work, he always wants $500 for materials. It doesn't matter how big or small the job, it's always the same. I always tell him no and I buy the materials myself. He does the job, I pay him and he runs to the bank to cash the check and buy beer.

Some guys will want payment every day, others after the job is done. If you get somebody that is really good, you can pay on a daily basis, but you have to be careful. Subs have three major problems. Drinking, drugs and gambleing. It's usualy one of those three. The drunks are your best to deal with as they are the most reasononable. The drug addicts are usually hard workers, but thieves. Watch everything if you have any on site. Gamblers are very unreliable. Once they get paid, they disapear to where the like to lose there money. The gamplers seem to be the nicest and most friendly of the three, but the drug addicts are the best liers.

When you build your house, you will have all three there at one time or another. Know it and expect it and you wont' have any problems. Pretend that they wont be there and you will learn the hard way.

Also don't ever fall for loaning anybody any money. You will find that one of them will come across as the nicest guy you ever met. After awhile, he will give you some very believable sob story of bad luck, sickness or disaster and ask for a few bucks. The last house I built the painter said his son was in a terrible car accident. He was in tears asking for a few bucks to go to the funeral. Nobody gave him a dime as another sub told me he always has somebody die on every job he's on. He was a drug addict from what I was told, but I never noticed anything about him until that day.

Remember, some subs come and go at various times in the job. Some do multiple tasks. I've found trim guys to be very good framers, but framers who do trim also are iffy. Electricians sometimes do HVAC, but rarely does a HVAC guy do electrical. I made the mistake of using an electrician on a house to put in the HVAC system. He was a good electrician, but when I had a problem with the compressor for the AC unit, he became a problem. Now I use specific subs for each.

Do you know how to seal a window? I've seen them go in without any flashing on jobs I was on. Big tract projects with dozens of homes being done at once. They just nail them on and try to get them plumb. Close enough was very common on that job, and this was with a major home builder.

A good GC will be able to save you money, keep you on schedule and solve any problems with your design and your subs. Most every home plan is wrong in one way or another. It might be something simple like the wrong number on a measurement, or a wall the doesnt fit where the plan says it should. It could be there is no place for the HVAC system, or a place to run the ducts and returns. If it's a custom plan, then it's never been built before and the guy who drew it up is gonna make at least one mistake. A GC can usualy spot problem areas before you start construction. He should make suggestions and changes to your plan before you start. I looked at a plan over the weekend that has one of the worse kitchen layouts I've ever seen. They put a huge island in the middle of a small kitchen with no counter space next to the stove, which was between a pantry and a fridge. It was terrible, but the home owner and the guy he's thinking of useing didn't see it. I'm not interested in the job, but I told him he should find a better GC if that one missed that kitchen disaster.

Kitchen cabinets are gonna be a huge expense. I like store bought ones for my homes and remodels, but for higher end homes, custom built are better. The guys who build low and medium priced cabinets are what you pay for. High dollar cabinets will cost you allot of money, and there is a difference in what you get. Joe Schmo working in his home shop isn't going to be able to give you the quality of Mr. Cabinet Maker can who does this full time with a crew of pros. I like store bought cabinets because they are always the exact size you order and the finish is baked on in an oven. It's very hard, if not impossible to get the same quality finish on custom built cabinets that cost allot more money.

I'm sorry for such a long winded reply, I can go on and on, but the point is that if you do it yourself, you better have a sense on humor, not stress easily and be prepaired for suprises. It's not about how well you plan, but how well you handle and fix the problems.

Good luck,
Eddie
 
 
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