The following are ideas I hear from potential clients about how to save money and why they don’t work:
- “I can be my own general contractor (GC).”
A good GC can make their job look easy but requires tremendous skill, experience, and time. A quality general contractor has a pool of quality subcontractors (plumbers, electricians, HVAC, etc.) that they draw on, and that will show up because they know that the GC won’t waste their time and will get future work if they do a good job. - “I can do some of the work myself.”
Painting is often considered a low-skill trade that a homeowner can do themselves. Many people could do a fine job painting their own homes. The problem is that the painter is brought in multiple times on a project—for a base coat before cabinets go in and then the final coat after—and works fast. Unless a homeowner can drop everything to paint—quickly—when the GC needs it done, it won’t be helpful. - “I’m going to go with the general contractor with the lowest estimate/bid; how bad can it be?”
It can be very bad and cost you more in the long run. If a contractor’s estimate/bid is significantly less than competitors, it doesn’t mean they are a genius and have figured out a new way of doing business. It more likely means they overlooked something(s) or lowballed their estimate to get the job and plan on clawing back money during construction. - “Let’s just leave the [attic, bathroom, fill in the blank…] unfinished; I can do it later.”
For example, some people think they can have a room framed out and finish it when they have money, but it can impact getting permits. For example, the building inspector must see outlet covers and plumbing fixtures installed before they can sign off on final completion. - “I’ll buy all of the [plumbing fixtures, door hardware, fill in the blank] myself to save the contractors markup.”
Plumbing orders are notoriously complicated because of all the things that are in the wall. If a needed part is not there, it can cause delays, plus the plumbing sub-contractor is responsible if something goes wrong. Specialty lighting fixtures (like a chandelier) are an exception. - “I’ll buy everything from big box stores or online.”
That toilet from a big box store may look like the toilet at a showroom, but the parts inside are most likely not the same quality as what comes from a plumbing representative. Companies may sacrifice quality to meet the big box demands for low prices. Some companies (like California Faucets) will not honor their warranty for items purchased on Amazon because it may be a knockoff. - “I’ll hire someone to draft my plan and save on architect’s fees.”
There is a reason why architects are licensed. It’s to protect the public’s health, safety, and welfare. There are a lot of nuances to design, building science, and code requirements that can only be learned through education and experience. - “I’ll buy stock plans and save on the architect’s fee.”
By the time you pay for the adjustments needed for local codes, the site, and your own needs, they aren’t going to save you money. - “I’ll save money by cutting back on the quality of finishes from a discount store.”
Buying tile from Tile for Less will not significantly reduce your construction costs.
According to The National Association of Home Builders, interior finishes are only 0.30% of new single-family construction costs. There is a difference in tile quality that can impact durability, plus the stock is usually from builder projects that use either bland or trendy, not timeless. - Don’t assume that “everyone else has more expensive taste, and that’s why costs are high.”
Clients often tell me, “I don’t have expensive taste; I’m happy with something simple.” The baseline cost of something of good quality that will look good and be durable for years and years is not lower than average. It is normal. You can go lower than the norm by using materials, cabinets, faucets, windows, etc., that will only last for a few years but will cost more in the long run when they have to be replaced.
The following are ten ways that work to Control Project Costs:
- Start with a reasonable budget.
If you try to do too much with too little, the quality or your budget will be compromised. - Identify what is most important to you.
Know what is not. That way, you’ll know your priorities if you need to cut back somewhere to meet the budget. - Get a contractor involved early in the design process.
No one is more up-to-date on local prices than contractors, and having one look at early drawings can be a reality check. - Adjust the project scope if needed to stay on budget.
It may mean reducing the size of the project. Sometimes, smaller is better, and cutting back on the quality of finishes does not make a considerable dent in construction costs. - Allow yourself time during the design process to make decisions.
There are a lot of decisions to make during the design process. It’s better to take time to discuss them and think them through rather than rushing to start construction. Changes after construction begins are costly. - Have plumbing fixtures, lighting, tile, etc., selected before construction starts.
This will allow accurate price information before any shovels hit the ground. - Prepare detailed plans and specifications for the contractor.
The more information the contractor has, the more accurate the pricing. - Consider having a negotiated agreement with the contractor.
Rather than padding a bid to cover unknowns or bidding low and expecting to claw back more money during construction, a negotiated agreement is transparent and fair to all parties involved. - Have a contingency fund to cover unknowns (especially important when remodeling an existing house).
Something unpredictable always comes up. It is essential to plan for it by setting aside at least 10% of construction costs. - Try not to make changes after construction starts.
Sometimes, it happens, but it’s more cost-effective to have confidence that the decisions you made during the design process were right for you and your family.