Biggest Problems For Owner Builder

oopsThere seems to be a few common problems owner builders run into. On average I get called to about 6 unfinished owner started projects a year. I also get called to about another 6 projects every year before construction has even started where I can say with 100% certainty the project will be abandon. I receive numerous calls to come look at projects where they recently completed another renovation which was done incorrectly and is a major safety or future damage issue. So if you are considering building a project on your own consider the following.
#1 No plans or permits on a large job
This is money saving trick #1 for most people when trying to fit their $200,000 remodel into a $100,000 budget. But it’s also the most costly in many ways. The first problem is the property owner never had a completed layout where all of their ideas were review able on paper. So inevitably things wont fit, things were forgotten and extra stuff was added that shouldn’t be there at all. The second problem is there is no clear direction for the builder. Even if the owner has a great and realistic mental image of the whole project every tradesman is showing up to the job without layouts finishes etc. Everything will be extremely close but not exactly right. The third is the city can find out and condemn the property locking out the owners until its repaired or approved according to their standards. Lastly there is a liability of personal safety and property insurance coverage. Illegal work done without permits can put people at risk and may not be covered by your property insurance in the even of a lawsuit.
No plans and permits is OK when you are throwing in some new paint and carpet. But when you have a major remodel with structural and mechanical work its best to get plans. Or if your property will be open to the public as a business. Even if you don’t pull any permits it’s best to make sure your new work is 100% up to code requirements. I have seen so many people who couldn’t afford $10k in architectural fees install $100k in construction and have to demolish everything shortly after. Don’t let this happen to you.
#2 Taking the low low bid
People have a habit of seeking information which will reinforce what they want to hear. After receiving three construction proposals from seemingly qualified companies they notice two contractors prices are about equal and one of them is significantly lower. They may ask why the price is so much lower but they often are excited in believing they have finally found an “great deal” or “honest contractor”. This fallacy is twofold; the first mistake is assuming that the lowest bidder is including the entire scope of work or that they even understand how to estimate construction costs. Contractors are not liable to complete the construction per your requirements and can submit change orders for any scope of work they did not include. Secondly, the customer assumes that the contractor will finish the project despite loosing money on the agreement. Although this sometimes happens it is the exception to the standard and happens very rarely. This is often coupled with the fact that the customer is inexperienced in dealing with contractors and doesn’t understand these risks and makes many mistakes themselves when performing within their contract requirements.
#3 Coordinating sub contractors directly
Sub contractors, like so many of us, often will take shortcuts. Small companies may not be licensed or insured. Owner builders often hire these contractors themselves and the sub contractor immediately understand that the owner builder does not understand construction. There are several problems that arise in this type of arrangement. The first is project timing and critical path schedules are not correct, in other words contractors are called out in the wrong order. The second problem is subcontractor understand they can get away with more than they could being supervised by a construction professional. They may see an owner builders lack of understanding as an opportunity to perform their task by easier means even if it negatively affects the performance of other sub contractors later.
This article isn’t intended to scare anyone away from attempting to manage construction and any construction project whether managed by a ¬†contractor or owner builder will have complications. It’s merely a warning that an ounce of prevention is worth a pound of cure. Spend the time and money to do right the first time or you will spend the time and money to do it right the second.

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