Building Success 101
Q: How do allowances work?
A: Allowances allocate funds to parts of the job that haven’t been fully specified at the time of contract signing. For example if the homeowner has yet to find the right kitchen cabinets, the allowance permits construction to begin by specifying how much can be spent. It also sets a date when final selections must be made. Most projects include some allowances, but because they can be a source of uncertainty and potential stress, builders work with the homeowners to minimize their number.
Building a custom home can be stressful. Savvy homeowners choose a builder who will make it less so. But beyond making certain the company is licensed and insured and has provided a fair bid and a professional contract, how do owners determine whether a company will deliver on its promises and not tax their sanity? The answers lie in good systems. Companies with clearly defined management systems tend to be better organized, communicate more effectively and minimize unwanted surprises.
Three key systems that are key to a comfortable building process have to do with communications, schedules and responsibilities.
Communications. A recent Consumer Reports survey of more than 900 homeowners confirmed that, when it comes to building projects, miscommunication is the root of most ills. That’s why smart custom home builders have solid processes for keeping homeowners informed at all times. Signs of a company that communicates well include detailed project descriptions (leaving no question about what the finished product will include), the ability to explain financial concepts (where, exactly, the dollars are going) and regular meetings.
Meetings eliminate problems by getting everyone to think through the job. A good example is the preconstruction meeting, where the homeowner meets with the builder’s team to review plans, schedules and job rules. This is also a time for the homeowner to ask questions and make requests (for example that certain trees be protected during construction).
Ongoing meetings, at a schedule agreed on by the builder and homeowner, tend to be shorter and less formal, but keep everyone updated on job progress and let the homeowner voice concerns and questions.
Schedules and Payments. The old adage “fail to plan, plan to fail” may have been penned by a builder: a schedule that details the job from start to finish is crucial to getting things done on time and within budget. Of course weather delays, delivery problems, change orders, and other unforeseen events can shift production schedules over time, but a well-managed custom home construction company starts with a plan and updates everyone should dates change.
Payment schedules are just as important. The builder receives a percentage of the job cost as a down payment, and subsequent payments on completion of certain milestones: the finish of framing, the completion of mechanical and insulation inspections, etc. Well-planned payment schedules allow owners to clearly understand what is expected of them and helps the builder to manage his resources over the course of construction.
Who, what, when? As a professional custom home builder, we invest time to help our clients understand how our team is organized and how to interact with team members. Who will be responsible for the job at each stage, including the final closeout and punch list? Who to contact with questions or concerns, what’s the best way to make contact, and how long before you can expect a response?
Understanding how the builder handles these kind of issues has real payoffs. The answers will indicate how effectively a builder communicates, pays attention to details, and has systems for getting things done on time and according to plan — all of which help make the building process the positive experience it should be.
Warm Regards,
Steve Jones & Bart Jones
Merlin Custom Home Builders
6408 S. Arville Street
Las Vegas, NV 89118
702.257.8102 – Phone