Having built our last house, I will throw in my two cents....
The most important thing is to build your house on paper first. I can't stress enough how expensive even small changes are once you begin construction because everything relates to something else. Moving walls, adding space, changing the floorplan is simple on paper, expensive when you get started.
The second thing is to schedule your contractors well. I never really understood the meaning of "times is money" until I had a construction loan ticking and had a couple of delays with subs.
As far as unforseen costs while building...there shouldn't be many if you work up a complete budget with accurate estimates and bids from your subs. Still, we built a 15% hedge factor into our estimates.
I would suggest you go pay to have a full soils test/engineering review done prior to building your foundation. From the foundation on up, you can control your costs if your budget starts to get wacky (looking for deals on cabinets and fixtures for example) however if your soils require an engineered foundation, you'll want to know that first rather than five years down the road when your foundation is failing. I don't know about your area, but where we built, soils testing was voluntary. I was amazed by how many builders started digging a foundation for a $400k house without giving any thought to whether the soils were good or not.
Here is a list of a few things that sound small but can add up pretty quick:
- Porti-Potty for the site
Temporary water and electric (some of my subs needed 220 which was additional)
Dumpster
Theft/Liability insurance for the duration of the built. Homeowners doesn't cover construction!
Temporary fencing or lockable storage for building materials (until you get dried in)
Reinspection fees if you fail any inspections (we didn't but some munipalities will charge you extra if the have to come back)
Gutters and landscaping
Window coverings
Light bulbs (sounds crazy but when you first move into a house you'll be shocked at how many ##$%@#@# light bulbs you need to buy).
If you want a real reality check, go to Lowes and walk every single isle while reminding yourself you'll need anywhere from 1 to 10000 of every item you see in there!
Last but not least, I don't know if you are planning on doing any of the work yourself. If you are a pro (electrician, HVAC, whatever) by all means do the work yourself. However, my biggest mistake was doing too much of the work. I learned a lot, but it added time to the schedule (interest never stops on the construction loan!) and when I added it all up, I would have been better off paying to have more of the work done professionally and getting it done quicker. (That and I ended up with a bunch of tools I only used once). I know MMM is al about insourcing but building a house is a lot like a ballet and timing is critical.
You can save yourself a shit ton of cash by:
- Acting as your own general contractor (managing budget and subs)
Painting and landscaping yourself
Everything else....find kick-ass subs who will get in, get out and do the job right.
Final note....it should be obvious but never pay a sub until the job is done and has passed inspection. Write that into the contract. Some subs will tell you they need 50% up front to "buy supplies." Don't do it! Go buy the supplies yourself and store them on-site if you feel the sub is worth it. Otherwise it's a red flag.
Good luck! Building is frustrating, nerve wracking and totally a blast!
