How to save costs when building your own new home
1. Choose the site location very carefully
Kotzé says when buying land, size is definitely not the only consideration. It is worth buying a somewhat smaller stand, for example, if it is already connected to the main water, electricity and waste networks in the area, as it is very costly to secure these connections yourself. If the stand also already has a fibre or cable connection to the Internet, so much the better.
Then you also need to think about the location of the stand in relation to work, schools, shops, public transport hubs and sports or entertainment venues. Land on the outskirts of town may be much cheaper but living there will almost certainly mean high transport costs. This is one of the reasons for the growing popularity of ‘brownfields’ projects, in which old inner-city industrial sites are being redeveloped into new residential areas.
Bill Rawson, Chairman of Rawson Property Group and experienced property developer, says another important consideration buyers overlook is the accessibility for construction vehicles, and access to power and water for the construction process, not to mention getting a professional survey done to pick up on any slopes, drainage issues, soil types and underlying rocks that could cause problems
Zoning is also an important factor, as some even have restrictions that limit building options. He recommends double-checking zoning status and getting a copy of the site plan before making an offer.
2. Think about the style of home you want to build
This can have surprising cost implications, and you would do well to seek professional advice from an architect, developer or qualified builder before you make a final decision.
For example, you might like the idea of an open-plan layout, but because there are fewer walls to hold up the roof, the beams required to do so will be more expensive. You may also need more costly wiring and plumbing solutions, and open plan homes are generally also more expensive to heat in winter. By contrast, you might think it would be more expensive to build a double-storey home than a single-storey with the same floor area, but it actually could be cheaper – and more suited to a smaller stand – because it requires much less roofing and a smaller foundation, suggests Kotzé.
3. Understanding building loans
A building loan is quite different to an ordinary mortgage, and, Rawson says it’s important to understand these differences before signing on to the building process.
“For starters, building loans aren’t lump sums. You don’t get paid the full amount of your loan to manage as you please – the bank gives you instalments based on the progress their assessor sees on site. That means if progress is delayed, or you hit unforeseen problems, you might not have immediate access to the capital that you need.”
You need to shop around for everything, including your lender, architect or designer and material suppliers as well as your builder. If you need a building loan, for example, even a small difference in the interest rate can make a big difference to the eventual cost of you home, and it’s best to get a reputable bond originator to help you secure the most favourable loan.
For this reason, Rawson recommends putting aside the equivalent of a 10% to 20% deposit to use as an emergency fund in case of unexpected expenses.
4. Always go for quality when you choose a builder
According to Kotzé, it is extremely important to spend time in selecting a reputable, registered builder with a real track record of quality work that was completed on time and to the satisfaction of their previous clients.
You should preferably be able to view homes they have already built, and you should be sure to call any previous clients given as references. Price should really not be your guideline, as some excellent builders may be able to give you a cheaper quote simply because they are really efficient, while some really shoddy builders may quote more if they know you are inexperienced – and end up costing you even more when you have to pay someone else to fix their bad work.
5. Stick to the basics - and your budget
As the plans for your new home come together, you should keep asking yourself what you can do without, at least for now,” he says. “For example, to have the ‘green’ features that are really important to you and still come in on budget, you may have to forego higher-grade carpeting for now, or choose standard bathroom and kitchen fittings, plain tiles, melamine cupboards instead of solid wood.
Similarly, he says good quality roofing is much more important than a built-in braai on the patio, or a fancy garage door. The idea is to think about every single item that is going into your home and choose the most cost-efficient option, or do away with some things that you don’t need right away, in order to afford quality basics that will add value to your home in the future.
However, it is also important to discuss any changes you want to make with your builder to ensure that these will not jeopardize the basic structure in any way, or result in the completed home not passing inspection.
6. Plan to DIY where you can
There might be areas of the project you can handle yourself, or with friends, to keep costs down. For example, if you have done your homework and know where to get really good deals, you may prefer to select and buy all your own fixtures and finishes, such as floor tiles, countertops, light fittings, sinks and baths, cupboards and carpets, instead of relying on the builder to do so.
Perhaps you could also enlist the help of friends to paint your home once it is built, or to layout the garden and put up shelves in your garage? This will help you keep your total costs down – but don’t get carried away and suddenly decide to become your own carpenter or tiler. Stick to things you already know how to do and leave the rest to the experts as that is likely to be more efficient and cost less in the long run.