Why do I want to take on the hassle of being my own General Contractor (GC) and do this?
I can imagine all the things running through your head. I have a full time job! Where will I find the time? What if something goes wrong? I had the same reservations. However, after getting a number of bids from General Contractors and working the numbers it was outrageous and this was with lower grade materials. Everything else would be a change order. It was either manage it myself or not do it. Here are the top reasons why you should take this on:
It’s Not Rocket Science.
People have been building their own homes for thousands of years. The tradesmen are very experienced. Everyone works from a common plan that you work with a designer to create. How do you find them? Ten years ago this was a problem. Now, in the internet age there are sites for finding the right ones.
Save $
By doing this yourself, you eliminate the middleman. What has the internet really done for business? Allow people to go direct and save. If you could have 20% to 40% from the costs gotten from the GC’s, on a $150,000 addition this is $30K to $60K savings that can be put towards a child’s college fund, your retirement, or even that boat you’ve always wanted.
Its Not Hard to Find Tradesmen (or Women) to Complete the Work.
With sites such as Angieslist, HomeAdvisor and Yelp use the ratings systems there for selecting and getting the right tradesmen for the job. Each of these are free to just a few bucks per month. And the sites have a ratings system. If they haven’t done a good job in the past, it will show. Make sure every tradesmen asked for a bid knows a rating will be given.
Time
Time is on your side. It costs a General Contractor a ton of money as they don’t get paid until the job is completed. There are books to read to give you a step by step process for how to manage this while working a fulltime job. Have to meet a drywall contractor? If they want the job, they will meet you around your schedule before or after your regular work hours. If the job takes longer, so what? Isn’t it worth the $30-60K that will be in your pocket?
Get Exactly What you Want
This one is larger than you might think. Visit a friend in a new home in a development that was recently built. Ask them what they plan to upgrade. Usually it is every fixture and surface in the place. This costs way more than you think. The General Contractors are motivated to use cheaper materials as if they do, they make more profit. If you want something outside of their “contractor grade” products, this is known as a change order. This is a highly marked up version of the original product. One job, I asked the GC to just provide me the shell and I’d have it finished myself. The response was, “we don’t do that as the finish materials is where we make all of our money”. So get the EXACT materials you want as you are in charge and specify or buy them yourself. You want a special, designer tub in your new master bathroom, go for it. To test this theory, ask a general contractor how much a special jetted tub will be to the overall cost. In reality this requires one additional breaker and the cost of the tub. Research the cost of the tub ahead of time and compare notes.
There is a Guidebook
There is a guide to show you how to do this. I am a bit biased as I wrote the book after having to figure it out myself while working a stressful and demanding full time job.
Discounts Galore
But….. my GC said they will afford me their discounts. Rubbish! The building supply houses will provide you with contractor discounts if they know you will buy everything from them. Make sure they know you are getting competitive prices. Most will even do the “materials list also known as a “take off” at no charge.
How Can I be Sure Things Don’t Get Messed Up?
Going into a few of these, I thought building inspectors would be difficult to work with. I could not have been more wrong. Building inspectors LOVE working with the homeowners. One local building inspector said it best, “it’s not a homeowner I need to worry about as they are watching over things, the home builders and GCs are where the corners are cut.” The building inspectors are watching out to make sure the build is safe and in compliance with code. If a contractor does not have it meet code, they fix it or don’t get paid.
Pride and a Sense of Accomplishment
Taking on and managing such an activity is life changing. By facing and accomplishing something that was thought to be unachievable is rewarding and a lifelong accomplishment. Show off your work, talk about the savings and pay it forward. This is why I am posting this. I hope you can share this as well.
Another Source of Income
Now that you have one under your belt, why not be on the hunt for a home to flip. You now know you can do it and the system in which to do it, why not make a healthy side income flipping homes.
