After work this evening we met with Matt Ruttan (our builder) to discuss our house estimate (finally)!  We’ve been waiting for a while for Matt to put together a true cost estimate to build our house.  To do this, Matt sent out copies of our plans (electronically) to different subcontractors that he would use to build our house.  In return, they sent him bids for what it would take to do the work.  He then compiled them in to what creates our estimate.  Although we could have done this any time, Matt thought it would be best for us to wait until when the subs are less busy which would give us better pricing (ie: when contractors are super busy they increase their price because their demand is so high).  Since we had the time to wait, Matt didn’t get bids until December which is typically a slower month for the construction industry.

Matt compiled our estimate and after adding in 95 different line items from all of the different subs we were over budget…by 25%!!  This was heart breaking!  The home of our dreams was completely unaffordable.

So, now the dirty work – why was it over budget, what made it so expensive, and how can we lower costs?  In my opinion, you need to ask a builder to put together a home bid in one of two ways:

1. Bare bones. Have the builder tell you what’s the cheapest we can get this house built. Then if there’s extra room in the budget, you can ask the builder to add in more expensive things into the house.  Doing so, means that they either have to estimate how much those extras are going to cost, or the builder has to get new bids from his subs.
2. Go for it. Tell the builder everything you could want in the house and then if the price is too expensive (as dreams usually are), the builder will take things out of the budget.

Luckily we chose Option #2 and had the builder go for it.  I say luckily because it gives us lots of areas that we can ‘cut’ from the home to be within our budget.  I had him do Option 2 because it still tells us how much those extras will cost us if/when we decide to put them in sometime in the future.  For example, we had him price out having a built-in buffet in the dining room. Obviously this is something we can live without and it doesn’t affect the overall quality of the home.  Although we’ll cut it now, it’ll be something we can add in later and now we know how much it will cost us!