The Design-Build Process
Updated: Jun 19
We would like to design and build your new home, but even if you already have a designer, we want to be involved in the process. The whole process should be: design-budget-specify-estimate-contract-build.
The nature of a custom home business is such that the process of designing and building a new home is customized for every buyer. While each project is unique, the process for designing and building a custom home usually follows some of the same steps. Following is a look at how we frequently manage the process:
Conceptual Budget Frequently we create a budget for prospective buyers even before preliminary plans are available. Similar to a feasibility study, the projected cost and scope may be needed to support a project’s viability. A conceptual estimate should provide enough information to allow an owner to determine whether a proposed project is feasible. The best sources of this information come from historical cost records of completed projects. This step is often necessary prior to committing to design or professional service fees. A good conceptual estimate should provide enough information for the owner to have a clear understanding of how much home they can purchase for their money. We offer this service free of charge to our potential customers. Preliminary Design Once we've presented our proposal to the buyer, if the budget is acceptable we can proceed with Design Development and Preliminary Plans. We usually take a $2500 to $5000 deposit before beginning the design. The design may be created either in-house (Kg3dHome.com) or by an architect with whom we have a good relationship. Our objective is to create a design that can be built within the budget we proposed. We will provide you with a detailed set of design drawings that include floor plans, elevations, sections, 3D images and even a video. After the Preliminary Design is completed to your satisfaction, we confirm the budget and inform you of any cost variances that may have developed during the design process. If we've done a good job, there shouldn't be any surprises.
Preliminary Estimate and Specifications To keep the process moving, we have to be able to provide an accurate preliminary estimate. In order for the best value to be obtained, construction pricing needs to be available during the design process. Seldom does the price of a completed design fall into the expected budget of the buyer, without the help of a builder or professional versed in current costs. Another reason that we prefer to quote from preliminary plans is that we don’t like bidding against other bidders. Although we are not opposed to bidding, many times the buyer obtains apples vs. oranges comparisons. Many of the builders that we compete against in these situations, do not propose the scope or detail that we do. For these reasons, we have developed a very detailed set of specifications. Documentation provides the format for developing a strong relationship with our buyers. We prefer that our buyers are well informed and educated in the home building process.
Specifications compliment a set of construction drawings as the written description of work to be performed on a project. The commercial construction industry has a standardized format for their specifications, but the residential industry does not. As a result, nearly every residential project has unique written requirements if they exist at all. Good specifications should provide all the information required by the builder, the trade contractors and suppliers working on the project. Concise information supports accurate bidding, enhances communication, improves quality, expedites the time schedule and prevents mistakes.
Budget Proposal Our preliminary estimate follows the format of the specifications. Both the proposal and specifications are worded in “user-friendly” language. In the proposal, we make many assumptions based on what you may have indicated wanting. Depending on the level of information available, a price range can be established. Initially, some of the budgets, like the concrete floor slab, will not vary greatly in price. Based on the size of the home, it is not very difficult to determine the cost of the slab. However, other budgets like interior trim and painting can vary widely. As we spend time with you and learn more about your needs, we can begin to “fine tune” the budget until ultimately establishing an accurate price.
Eliminate Surprises Before the next step, we explain that the preliminary price may become the final price, as long as we stay within the guidelines of the proposal. During this process, we will educate and communicate with you, and strive to stay within the parameters of the proposal. This is very important to the relationship at this time. Surprises and omissions at this early stage can lay a foundation for lack of trust that could continue throughout the entire construction process. Hopefully, by this point, we will have built a good relationship with you and can proceed with an agreement and construction of your new home.
Construction Drawings The next step is to start on the working drawings, the actual documents that we use to build the home, and put together the construction agreement and all of the other paperwork that we will use to manage the construction of your home. Prior to beginning the working drawings we usually take another deposit of $5000 to $10,000. Both of these deposits go toward the cost of your home and will be deducted from the first payment draw that we receive from the Lender. While the construction drawings are in process, you will need to be finalizing details of your financing. Typically we first create a "Bank" set of drawings. This is a full-size set of drawings that provide all of the information necessary to build your home. You will have an opportunity to review the drawings before the final set is completed. The Lender will use these drawings to perform an Appraisal and we will use the drawings for Roof and Floor Trusses, Energy Calculations, Window Specifications and Architectural Review Approval. There are additional steps at this stage whereby this information is used to put together a "Building Permit Package" and eventually complete all of the construction drawings. Financing Our typical Buyer usually borrows the money for their new home from a conventional bank although we certainly aren't opposed to cash. We are already approved and familiar with several lenders in our area. Construction/Permanent or Construction-Perm financing is most common. In this arrangement the funds that are borrowed are used for the construction of the home, and when the home is completed the loan is converted into the permanent financing. Normally, the process of obtaining financing approvals run parallel with the development of the construction drawings and permit application.
Closing After the bank has approved your financing and completed an appraisal from the plans and specifications of the new home, a closing will be arranged. Closings frequently take place at Alliance Title Services. With construction-permanent financing, the closing takes place before construction starts. The ownership of the property will be transferred into your name and the balance of the sales price for the home will be disbursed to the builder through draws during construction. Your down payment will be the amount that you have arranged with your lender less the deposits we have received. If everything has run smoothly to this point, we may be almost ready to pick up a permit and start construction. Orientation Meetings Starting during the design phase and continuing after construction starts, we will have regular meetings with you to keep the project on track. Theseorientation meetings are used to inform and educate; review ideas and make decisions; prepare and debrief, and; generally try to meet or exceed your expectations. There are numerous customer selections and decisions that we need from you during the entire process. We promise to keep the process organized and help you all the way through. Many of our customers might even attest that they had a little fun.
The real beauty of design-build is the benefit to the construction process. With involvement that begins with the design phase, there's no excuse for confusion or missing information. We have checklists and procedures designed to streamline the process and enhance the productivity of our entire team. We learn something from every project and use the lessons to enhance our processes to the benefit of the next project. Please review our project management information and feel free to ask questions.
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Little is more meaningful and personal than a home, and the experience of designing and building your own home should be rewarding and enjoyable. Choosing a builder is difficult. The process of designing and building a home involves numerous decisions about components, systems and services selected from criteria that includes price, quality, appearance and performance. How can you possibly understand everything unless the builder is willing to share all of the information?
Allow us to introduce you to The GCH Way of building your next home. Please let us know if you have any questions. Keith Groninger