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Building Your Home
When you are planning your homestead, you may come across the idea of being an Owner-Builder. It’s an option that can save you money in exchange for more control and supervision over your project’s construction. Rather than hiring a General Contractor to do your build, you handle all the paperwork and supervise subcontractors that you hire to complete different aspects of the job. It’s an appealing option, especially for those comfortable with some level of DIY’ing the building of their home and are confident that their DIY skills are good enough to pass an inspection.
Here’s a quick FAQ breakdown. Be sure to check with your local planning department for more specific details on requirements in your area.
OWNER BUILDER FAQ
What is an Owner-Builder?
An owner-builder is very simply someone who owns the land or building that they intend construction work to be performed on or to. So, as a homesteader, you are an Owner-builder if you intend to build a home on your own property. You will be acting as the General Contractor during your construction project, which means you won’t have to hire one to see your construction project through.
What if I don’t have construction experience? Can I still be an Owner-Builder?
In most cases, Yes! As the owner-builder, you can hire subcontractors or employees to work on your construction project.
What restrictions are there on Owner-Builders?
The same construction restrictions are there for an Owner-Builder as they are for a General Contractor, including building-permit requirements and regular inspections. Check with your building department for further details.
Additionally, there may be restrictions on how long, post-construction, you must live in the residence before you are allowed to sell, lease, or rent it.
What are the responsibilities of an Owner-Builder?
The same responsibilities of a General Contractor including supervision of subcontractors/employees, passing code and building inspections, ordering and paying for materials, paying subcontractors/employees, ensuring subcontractors are properly licensed and insured, and maintain relevant records.
What happens if I make a mistake in my construction or don’t purchase enough building materials and supplies?
You are responsible for fixing any mistakes and ensuring that all materials and supplies used for the project are properly paid for.
Should I hire a Construction Manager?
In short, No. When you chose to become an Owner-Builder, you are responsible for all aspects of the project. Hiring a Construction Manager will not alleviate you of any legal or financial burdens should an accident occur on the job and may, instead, create liabilities that could harm you in the future.
How can I be successful as an Owner-Builder?
The best help you can get is to become friends with your local building department and building inspectors. They want to help you properly and safely build your home. If you have questions or concerns about something, don’t hesitate to reach out to them for help or additional resources. This is especially true if you fail an inspection! Take advantage of the opportunity to learn so that your home is as safe and secure as possible.
How much can I save by becoming an Owner-Builder?
While some publications suggest you could save up to 25% of the total construction costs by becoming an Owner-Builder, you will probably make mistakes and under-estimate materials and supplies unless you are a contractor yourself. These issues can lower your savings to between 10-20%, which is still good if you’re looking at a large project.
Can I get a construction loan as an Owner-Builder?
Yes, but the process varies from bank to bank, as do their restrictions and requirements.
- Complete control of the project, so you get what you want.
- Getting to chose who, if anyone, works on your house other than you.
- The pride and satisfaction of building your own home
- Fiscally and legally responsible for all facets of the building project
- Savings decreased by mistakes and unexpected expenses.
- It takes a lot of time to complete a large-scale project.
- Finding financing can be difficult.