What About Construction Plans? Once you have your lot, the next step is to get a set of construction plans. This can be a very expensive or a very inexpensive task. At one end are the ready-made plans that are available through the mail from building magazines (just check your newsstands). At the other end of the spectrum, you can hire an architect to draw up a set of plans just for you.

Mail-Order Plans Mail order is definitely the cheapest way to go, since a set of plans can be obtained for just a few hundred dollars. There are literally thousands of mail-order plans available. Be sure you check to see that they are appropriate for your area of the country and that the building materials list doesn’t involve some overly expensive timbers or metal. Be careful, however, if you buy through-the-mail plans. A“working set” includes all elevations as well as details of all unusual construction. Some of the plans that I have seen sent through the mail are simply a front view and an inside view. They definitely give you enough to see what the house will look like, but they’re a far cry from being detailed enough for you or a builder to work with. If you order through the mail, be sure that there is a full “money back” guarantee. In addition, as soon as you get the plans, take them to a builder to see if they are adequate. Expect to pay around $500 for a set of mail-order plans.

TIP GET THEM CUSTOMIZED Even if you order plans through the mail, you will probably have to modify them to accommodate your building site. Why not hire a local architect on an hourly basis to modify these plans? The cost can be a fraction of what drawing up a set of plans from scratch would be.

Custom-Made Plans Custom-made is the most expensive way to go, but you can arrive at a unique and well-built house. You hire an architect to draft a set of plans for you. Typically, the cost is 3 to 5 percent of the cost of building the house. (If it costs $100,000 to build the house, figure $3000 to $5000 for the plans.) A good architect will visit the building site and design the plans to fit the contour of the land. In addition, the architect will listen carefully to your desires for a home and incorporate those features that you want. Finally, a good architect will be aware of building codes and building materials costs in your area and will design a house to take advantage of whatever cost savings are possible. Interview the architect as you would any other person you are hiring. Ask to see plans that the architect has previously done. (Sometimes you can save money by modifying an existing set of plans.) Find out who the architect has designed houses for and then call up those owners. Did they like the work? Did the architect take advantage of cost savings wherever possible? Would the owners recommend the person? Find out first what the costs will be. Some architects work on an hourly basis; others have a set fee. Don’t assume that the costs will be minimal. Plans can be very expensive.

Do-It-Yourself Plans In most areas of the country if you agree to live on the property for at least a year, you are permitted not only to do all or most of the construction yourself but also to draw up the plans. No, this is not an impossible task. I’ve done it myself and I have no background in architecture or drafting. What I did was to study the lot and then design a house that took advantage of the view. I then hired a draftsperson to create a set of working construction plans on the basis of my rough sketches.

Work with your local building department, not against it. Find out in advance what special requirements it has (snow load, wind resistance, insulation, sewer systems, and so on). Incorporate these features into your plans at an early stage. Get to know your local building inspectors and ask for advice. They may save you hours of time and thousands of dollars by suggesting approved methods of building that you may not have thought of.

How Do I Find a Good

Builder? Of course, you can build it all yourself, if you happen to be a relative of Hercules. However, some of the work is extremely hard, such as pouring concrete and lifting heavy timbers. Some requires special skills, such as soldering, plumbing, and plastering. And some is just plain tedious, such as putting up siding and sheet rock. The alternative is to hire workpeople and/or a builder. Unless you plan to do at least 75 percent of the work yourself, you’re better off striking a deal with a builder. Keep in mind, however, that many builders are interested only in making a set profit on each job. When you submit a set of plans to them for a bid, they simply add up the square footage, multiply by a predetermined price, and that’s your cost. You might be better off with a builder who looks closely at the plans and figures the actual costs. If you plan to do some of the work finish the house, for example you need to find a builder who actually does true cost estimates. These include finding out what the materials and labor will actually cost and then calculating profit on top of that. In a house I built a few years ago, two builders went the first route, bidding by square footage. The third builder took the other course. The third builder’s price was 30 percent lower than that of the first two because he looked closely at actual costs of labor and materials!

TIP BE YOUR OWN CONTRACTOR If you do most of the work yourself, you can hire workpeople to do the remaining chores for you. You can do, essentially, what the builder does. You can hire carpenters, plumbers, roofers, tapers, and so forth. However, those you hire typically work on a “per job” basis instead of an hourly basis. They will want to see your plans and then will “bid the job.” If they see you’re inexperienced, they may give you a high bid. To avoid this, be sure that you get at least three bids for each job.

Builder’s Qualification Checklist yes no  Has your builder been in the business in the area of your lot for at least three years?  Is your builder state licensed?  Have you called the state licensing bureau to see if there are any complaints against your builder?  Have you called the local better business bureau or district attorney’s office to see if there are complaints?  Have you visited other houses your builder has constructed?  Did the prior construction look solid?  Did the owners voice any complaints?  Did you call the local building supply company to ask if your builder was ever late making payments?  Is your builder ready and able to get started?  Do you get along well with your builder?

Most builders will want you to sign a building agreement in which you agree to provide them a series of payments out of which they will pay their workers and their materials suppliers. However, if you pay the builder and the builder does not pay the workers and suppliers, you could still be liable for full payment to those workers and suppliers. (They could file mechanic’s liens on your property and force payment, even if you have to pay twice!) Your only recourse, in such an event, may be to sue the builder, who may have filed for bankruptcy. You can protect yourself by asking your builder to supply you with a completion bond. Most builders balk at this, however, because such bonds tend to be expensive and difficult to qualify for. If you are securing financing in order to build, generally the lender will check out the builder and will withhold payments until the builder supplies proof of payment for labor and supplies. You can demand this proof (in the form of mechanic’s “releases”) too. Again, however, it’s a hassle for the builder, and many don’t like doing it. In addition, sometimes the mechanics will give releases and then still file liens later on saying that the release was given on the builder’s check, and the lien was filed when that check bounced! Probably greater protection comes from insisting on paying subcontractors and materials suppliers yourself. The builder submits a “chit” or authorization, and you issue the check. Again, however, builders don’t like doing this because it allows you to see exactly how much they are paying for labor and materials and how much profit they are making on your house. Also, it tends to undermine their authority with the subcontractors.

You’ve bought the lot, had the plans drawn up, secured a builder (or hired subcontractors), and are ready to go. Once construction

starts, plan on being there a great deal of the time or on having a builder or someone knowledgeable there to handle things. There are always questions that pop up. What does that little squiggle on the plans mean? The plans call for a 3-foot foundation, but there’s a 7-foot hole in the building site what do we do? Where do you want the electrical switches? And on and on. Somebody has to be there to handle the questions.

TRAP DON’T COUNT ON THE

INSPECTORS Don’t count on the local building inspector to ensure that everything is done right. Building inspectors can’t watch everything all the time. If you don’t know how it should be built, hire someone who does to supervise the job. Plan on spending more time than you first estimate. Workers don’t show up on time. Building materials are delayed getting to the site. The weather turns against you. To be perfectly safe, use a rule of two. It takes twice as long to do anything as you think it will. Buying a lot and building your own house is a wonderful experience. But as anyone who has done it will tell you, it’s the sort of thing most people only want to do once!

What to Look For in a Home Inspection You need to have good, detailed information on the condition of the home you are buying. After all, just because it’s standing today doesn’t mean that it isn’t ready to fall over tomorrow. In the past, the dictum “Let the buyer beware!” was the rule in house hunting. Today, however, consumerism has turned the tables. Today it’s “Let the seller beware.” Sellers in many areas of the country must present to you, the buyer, a disclosure listing any and all faults with the house, often at the time you first see it or at least at the time you make a purchase offer. (In California, for example, you have three days to evaluate the disclosure statement. If you’re given the disclosure after the seller has accepted your offer, you may have grounds for backing out of the deal for up to three days.) Further, sellers now expect a buyer to insist on a professional home inspection. After all, it protects the seller, in many cases, even more than you! The reason is that while sellers may know many of the home’s problems (such as a leaky roof or broken window), they may know next to nothing about the house’s heating system or its foundation.

ASK FOR PREVIOUS INSPECTION REPORTS Sellers should keep and present to you any previous reports, including those they obtained when they purchased the home as well as any from previous buyers who didn’t complete the purchase. They can reveal much.

For that reason, many sellers are glad to have an inspector’s report to go along with their disclosure statement. It shows they have diligently made an effort to learn about problems and disclose them.

TRAP YOU PAY FOR IT Expect to pay for your home inspection, probably around $250 to $350. And usually the inspector wants to be paid at the time the inspection is completed, sometimes in cash! Make sure to arrange for how you’ll pay in advance so you don’t get a nasty surprise. The time to insist on a home inspection is when you make your initial offer. Write it into the sales agreement. Make sure that it’s a contingency of the purchase. (See Article 10 for a description of contingency clauses.) Sellers are almost universally prepared to let you have a home inspection. But they won’t let you tie up their property indefinitely. Typically they will limit your inspection contingency by insisting that it be completed and your approval given within 14 days. If you don’t approve, the deal’s off and the house is back on the market. Indeed, many sellers will insist that they be able to continue showing the house and to accept backup offers until you remove the inspection contingency.

Where Do I Find a Home Inspector? Ask your real estate agent. Usually active agents know of several they can recommend. However, also follow through on the recommendations suggested below. You don’t want to hire an inspector recommended by an agent because he or she has a track record of going easy on the property, thereby helping to make the deal go through. Also ask the lender or the escrow officer. As a last resort, try the phone article. When you select an inspector, ask if he or she is a member of ASHI (American Society of Home Inspectors) www.ashi.com  or

NAHI (National Association of Home Inspectors)

www.nahi.org .

It doesn’t guarantee competence, but it indicates they at least belong to national trade associations.

At this point home inspectors are not yet licensed in most states. That means that anyone you, I, or the guy who sold you this article may be able to hang out a shingle and be an inspector. That means it’s up to you to be sure you’re dealing with someone competent.

Check Out Your Inspector Ask your future inspector for at least three referrals from past jobs. Then call those people. Hopefully, it will be at least six months or more since the inspection and they will have had an opportunity to see if something came up that wasn’t initially discovered. You may get some surprising answers. Check the inspector’s credentials: What qualifies him or her to be an inspector? Look for someone with a related degree and a broad building background such as a soils or structural engineer. Often retired county or city building inspectors make great choices.

Some former contractors make money on the side as inspectors. That’s okay, but just because a person has a contractor’s license doesn’t mean he or she knows anything about a home inspection. A plumbing contractor, for example, may be able to do a great job checking out your sinks and toilets. But the contractor may know next to nothing about the wiring.

Should I Go Along with the Inspection? It’s the only way you can really learn what the home’s problems are. An inspection is both oral and written. In the oral part, the inspector describes problems to you as you go through, under, and over the home. You can ask questions and can often get useful information on how to correct a problem as well as how much that correction will cost. A written report, on the other hand, is often more formal. These days many inspectors are afraid to write down any but the most glaring of problems for fear that they could be sued by the seller for exaggerating something. Hence, the written reports tend to be bland and, quite frankly, not that useful. Often they are filled with more disclaimers than information. That’s why you need to go along and listen to what the inspector says. Here are just a few warning signs (there are many others) that you can watch out for:

Warning Signs of Bad Defects  “V” shaped cracks in the foundation indicates serious cracking  Offsetting cracks in the foundation indicates serious cracking  Cracks in interior walls suggests structural problems, bad foundation  Water marks on the roof rafters indicates a leaking roof  Water marks on basement walls indicates seasonal flooding  Standing water under home indicates poor drainage, possible foundation problems to come  Slanted floors suggests bad foundation or structural damage The inspector will point things out. But your inspector might not be the best in the world, so you should have an idea what to look for yourself. Below is a home inspection checklist. Use it as a guide either with an inspector or, if you’re bolder, when you inspect the property yourself. Keep in mind that while it offers many ideas, it is not complete. There may be problems with the property beyond the scope of the checklist.

TRAP IT’S NOT SELF-HELP TIME Don’t try to do an inspection on your own unless you know a great deal about buildings. I’ve been inspecting properties for more than 30 years and I still always hire a professional inspector to go along with me. The engineer can point out things that I miss, and vice versa.