Should You Hire a Home Builder First Before Buying Land?
March 5th, 2021 | by caronq
When it comes to custom home construction, one important decision you’ll need to make is to choose whether you should buy the land first or hire a builder. Your decision will depend on a few circumstances that need to be considered carefully.
You might think that buying the perfect lot should be done first before hiring a custom home builder. This may be more convenient in some cases, but depending on the circumstances, it may make more sense to hire the home builder first as they can help you choose the best lot for your needs and preferences.
“What if I Buy the Lot First?”
If it’s your first time planning a custom home, you’re probably thinking that the process starts with finding the right lot and then hiring an architect. Afterward, you’ll use the architect’s plans to solicit bids from custom home builders and then choose the best bid that fits your budget. This method may be more logical to you if you don’t have the budget for a custom home construction, but happen to find the perfect lot that has everything that you want.
Another benefit to this is that you’ll be able to secure a lot very early in your home building process, especially if it’s located at a specific location in a high-demand area, and lots are being sold quickly. You won’t need to worry about building a home right after you buy the lot; you can choose to save up money now and have your custom home built later on.
If you’re considering buying a lot before approaching your trusted home builder, you should at least hire a surveyor to see if the area is acceptable to build. Building a home in the lot you chose may not be allowed, especially if it’s in certain waterfront areas and protected areas that have forestation. Or, better yet, make an offer on the lot with a due diligence period. This due diligence time can be used for a builder review.
“What if I Hire the Builder First?”
If you choose to hire a custom home builder first, then you can count on the company’s industry experience in finding the perfect lot for you. Builders may even have locations available wherein they’ve already configured their improvement costs so that they’ll only need to offer their final price. While you may not find a lot that has everything you’re looking for, you’ll still be able to have more control over the cost of your home building project.
Keep in mind that it takes plenty of time and due diligence to find a great lot, which is something that often needs professional knowledge. For instance, you might buy a hillside property because it looks nice to build on, only to find out later on that there are building restrictions, and you’re forced to put it back on the market. Had you hired a professional home builder to help you out, the pros would’ve assessed this right from the start and advised you to choose a different lot.
When you hire us, we have a team of experts who are always ready to evaluate a lot in terms of history, paperwork, build-readiness and other features of the area. We’ll also take care of most of the necessary work, which includes a plot of survey for the lot, grading plans, soil tests, meeting the local building code requirements, site clearing and building pad requirements, topography and drainage, foundation elevation, construction access, utility requirements and access, permits, landscaping and fencing, and subdivision compliance requirements (if the lot is within a subdivision), to name a few. What can take months by yourself can be completed in a much shorter time with our services!
“Which Should I Do First?”
When you find a great lot for your project, it’s easy to envision how it will look. Hiring a trusted home builder will help you realize your future home while taking into account its ideal conditions and what modifications are needed to make it all possible. For instance, as an individual buyer, you may think that a perfectly flat lot is a great find for your future home, but when you hire a custom builder, the company will probably recommend that you get one that has a gentle slope up to the front and back toward the lot line for more visual appeal.
If you want to have a cost-effective experience while making the most out of your home building project, we recommend hiring a custom home builder first. You might find it a bit overwhelming to find the right lot by yourself as you’ll be competing against other builders and developers who are constantly acquiring great lots before they’re available to the general public. Most builders will almost immediately prepare a cash-written offer with limited contingencies and closing terms customized to the seller’s needs as soon as they find a potential lot.
Hiring a custom home builder can also be beneficial as the pros will offer better financing options. This may not be a problem if you already have the cash to fully finance your project, but if you need to obtain a construction loan from a bank, they’ll need to approve the builder first before offering several financing options. If it’s a construction loan, it will usually require around 30% of the whole project cost as a downpayment. When you work with a trusted custom home builder, they may offer rates that are lower than what you might expect on your own. This is because the builder has already established a good relationship with a lender, which also means a faster and more streamlined approval process!
When it comes to custom homes and home remodeling, Peartree Homes has got you covered! We’re a licensed, bonded and insured residential building company. Our design-build services have everything you need under one roof so you can be confident that we’ll get the job done with speed and efficiency. Call us today at (843) 343-5808, or reach us online through our convenient contact form.