Why have a home planning checklist to design and build your new home?
There is a lot of preparatory work involved with the design and construction of your home. Like everything else in life, organizing this task can make the process more manageable and less stressful. Creating a home planning checklist will help you complete your mission. In addition, you will realize your dream home from the design phase to the final walk through of construction.
There are five main objectives that you will need to establish on your home planning checklist. These objectives are buying land to build a home, home construction loan financing, residential design services, hire a home builder, and monitor construction progress.
Home Planning Checklist
1. Buy Land to Build a Home
At the top of your home planning checklist should be property. The ideal situation is to already have acquired land long before you are ready to begin home construction. If your own your land outright, that is an even better position to be in.
Making a land purchase is an important step to take in your home planning process. Buying land has a unique set of issues too and includes a list of items that must be considered before buying. See our post on what you should know before buying land to build a home and learn what is necessary in purchasing raw land.
Another option to buying land would be to take out a construction loan to cover the total cost (land + construction budget). You must keep in mind that the cost of the land will count against the monies allotted for the actual construction of your home. So if you are approved for a $350,000 construction loan and your land costs $80,000, you are only left with $270,000 to build your home.
2. Home Construction Loan Financing
Your home planning checklist should also include getting pre-qualified for a home construction loan. Only apply at local banks that are known for giving home construction loans. Lenders will require a 20% down payment at minimal to reduce their risk and ensure a commitment on your part to this project. Keep your debt-to-income ratio below 45% of monthly income. Establish a cash reserve that equal at least six (6) months of living expenses. Check your credit reports and score to avoid any surprises that may derail the loan process.
A complete property appraisal is needed to apply for a construction loan. Also, you need to have a general idea of what the project will cost. Talk with your home builder to get costs estimates to build your home. Knowing the estimated value of the finished project is important as well.
The most popular home construction loan is the construction-to-permanent. It is also know as a “rollover loan”, “all-in-one,” and “one time close”. You will have only one set of fees and one closing cost to trouble yourself with, unlike short term one year construction loans. Once construction is done, one (1) year construction loans will have to be refinanced into a new conventional mortgage loan (30 or 15 year fixed, adjustable rate, and interest-only) that you will need to re-qualify for. That’s two separate closing cost fees.
3. Residential Design Services
Take into account your need for design services on your home planning checklist. The most important question here is, does my state require architect stamped house plans? If an architect stamp isn’t require on your house plans, a licensed architect is not your only option. If that is the case, you should be thinking home designer or architect – who best to design my house plans. You can choose one or the other for a custom home design or search through stock house plans from either professional. You will find that a great deal of time can be spent doing either option of custom or stock plan search. Proper planning must be accounted for so that ample time is allowed to prepare the construction documents.
Opting for a custom home design will take the longest process. Between meetings, design presentations, and more meetings, you can literally spend weeks or, more likely, months preparing your house design. With so much time being spent with the designer, you will want to make sure that you have a comfortable working relationship. To do this, set up appointments or conduct short meetings with two or three design professionals you think will capture your dream home visions. See our post on interviewing building designers for home design services to get ideals on what you can ask potential candidates.
3.1. Stock House Plans
Stock house plans are not always a quick solution. There is the chance you may find perfect house plans to build your dream home in a relatively short time frame. Then again, maybe you won’t. The decision is emotional as well as financial. Give yourself plenty of advanced time to browse and study the many stock plans that are available. Months of house plan browsing is not unheard of.
Modifications may be necessary if you find a pre-drawn house plan that require some changes to meet your needs. This can take a couple of days or a couple of weeks depending on the amount of modifications. The size and complexity of the home design also play a factor in the modification time frame.
4. Hire Home Builder
Research your local area for home builders who specialize in custom home building. The case here is similar to that of the aforementioned design professionals. Moreover, these builders tend to have their own portfolio of builder house plan designs to pick from or a designer that they work with. Look at homes previously built by the builder to see their work. This will let you know what you can expect in your home. If possible, speak with the builder’s previous clients to get feedback on their experience. Including this task in your home planning checklist is a must.
You will spend months communicating with the builder before and during home construction. Make sure that you and the builder will have a pleasant working relationship. Take the time to interview several builders to expand your options. This will enable you to get comparable numbers on the cost to build your home and a chance to evaluate your rapport with the prospective home builder.
5. Monitor Construction Progress
At this stage of the home planning checklist, your dream home is almost a reality. To keep the dream a reality, you should monitor the construction process. Make sure things are being done according the plan specifications which can help in reducing the cost of home construction to stay within budget. Visit the site regularly and communicate any concerns or praises to your home builder.
Daily site visits are not necessary and may do more harm than good. Twice a week is sufficient enough. You can make sure the building process is going as planned. However, you will avoid becoming a nuisance to the contractor and sub-contractors.
Following these five homeowners checklist items will make organizing the design and construction of your home a much more pleasurable experience.