If you’ve never built a custom home, it can be difficult to know where to begin. We often hear about people finding the perfect lot for their dream home, and pulling the trigger on purchasing it without a builder in mind. In certain circumstances, like a hot real estate market or an irresistible price, buyers might not have time to consider who will build their home. On occasion, the timing works out in such a way that it makes sense to purchase the land and worry about the other steps later.
However, those scenarios are rare. In most cases, it makes sense to involve your builder before you make an offer on a lot, and here’s why.
The builder will be able to apply the knowledge that you don’t have.
It’s part of a builder’s job to understand the complexities around the land, topography, conservation requirements, utility issues, etc. As informed as you might be about the land, your builder is likely to see things that you’re not familiar with. For example, we once helped a client look at a site that he was considering for a new home. Our team saw some boulders protruding from the ground – and knew from experience that there was a lot of ledge on the site. The client did not buy the land. In this case, had he already purchased it, he would have made a very costly mistake.
Hiring a builder first will help you develop – and stay – within a budget.
Working with your builder first will help give you a clear picture of the budget – and help you decide what to offer on the land. If you’ve already formed a relationship, they are going to have an understanding of what you want in a residence. Hopefully, you will have already discussed concepts, even if nothing has been drawn. Based on that understanding, the team will have an idea of what the cost range will be, and from there you have a clear picture of your total budget. In many cases, you’ll see this formula:
Total budget – Cost of planned home = What you can offer for the lot
This will help you develop an offer that is in line with your overall budget and less likely to result in overspending.
In most cases, It is in your best interest to hire your builder prior to purchasing a lot. In our experience, we have seen doing so add value and save money for dozens of clients over the years. If you have questions about a particular lot or would like some advice on building in a certain area, let us know! We are always happy to answer questions about the building process. Contact us here.