Everything I Wish I Knew Before Building A Home

Building a house is a dream for many, but for me, it's been a nearly two-year rollercoaster of surprises, challenges, and learning. As I reflect on this journey, I realize there are several key insights and strategies I wish I'd known from the start that could have helped me manage my personal finances through the process. These nuggets of wisdom could have saved me time, money, and a few gray hairs. Here are three things I wish I knew before building a home that will hopefully help anyone embarking on this ambitious path.

Add at least 20% to your initial budget

The most shocking lesson I learned was about budgeting. It's easy to underestimate the costs involved in building a house. My advice? Take your initial budget and add an extra 20%. This isn't just a safety net; it's a necessity. During our build, we faced numerous unforeseen expenses. From last-minute changes in materials to unexpected labor costs, these additional charges can accumulate rapidly. We had to dig into our own pockets because our construction loan only covered a predetermined amount. This kind of financial strain can be stressful, so preparing a more expansive budget from the start is vital.

Additionally, it's essential to be meticulous in your financial planning. Keep track of every expense, no matter how small. Regularly review your spending against your budget to ensure you're on track. This level of vigilance can help prevent financial blowouts and gives you a clearer picture of where your money is going. It also helped us when discussing changes with the contractor, as we had data to point to with overages.

Incentivize your contractor

We learned this the hard way. Our contractor, initially enthusiastic, eventually lost momentum. In hindsight, we should have structured the contract with clear incentives for meeting milestones. This isn't about mistrust; it's about aligning interests and keeping the project on track. If the contractor knows they'll benefit from timely completion or high-quality work, they're more likely to stay engaged and efficient.

One of our biggest challenges was keeping our contractor motivated and on schedule. For months, there was little to no progress. In hindsight, including incentives in the contract for meeting certain milestones could have made a significant difference. These incentives could be structured as bonuses for early completion or penalties for delays.

Make the contract state who is responsible for mistakes

You know, when you're building a house, you'd think that a small error in the plans wouldn't be a big deal. But let me tell you, it can lead to a world of trouble. We learned this firsthand with our window-sizing ordeal. It all started with a simple mistake by our draftsman, who got the window measurements wrong. It seemed like a minor hiccup, but it snowballed into a major issue.

Here's the catch: our contract didn't say anything about who's responsible if something like this happens. We just assumed that the contractor would double-check everything before ordering. Well, it turns out that wasn't the case. The contractor went ahead with the draftsman's plans and ordered the windows, and by the time we realized the error, it was too late.

So there we were, stuck with a bunch of windows that were the wrong size. And since they were custom-ordered, returning them wasn't an option. Guess who had to foot the bill for this mistake? Yep, us. It was a tough pill to swallow, especially considering it was an error we hadn't even made.

This whole fiasco taught us a valuable lesson. When you're building a house, you've got to be on top of every little detail. You can't just assume that others involved will catch mistakes. It's crucial to actively participate, ask questions, and have an expert double-check the plans.

Also, make sure your contract is crystal clear about this kind of stuff. Who checks what, who's responsible for errors -- get it all in writing. Trust me, it's worth the extra effort to avoid the kind of headache we went through.