How New Homeowners Can Cut on Construction Costs

Considering how fragile the economy is right now and how some banks are timid to lend money for home construction, it's no surprise that one of the most frequently asked questions is how best one can save money when building a home.

Not long ago, banks were giving out loans and the trend was to build large, extravagant home. Today, some are less likely to fund new construction projects because of the high costs associated with them.

The good news for the new homeowners is that it is now more apt to build smaller greener and more affordable homes. There are ways you can minimize on your costs, that will make the banks more likely to fund your project. The prices of home building products are also reducing as manufacturers compete during a down market. Here are some of the ways you can cut on home building costs:

Buying Land: Buying the right piece of land could save you a lot of money. Before you buy your land, make sure it can be built on without excessive expenses like blasting ricks, moving of soil to or off the land, creating access roads and compacting soil if the land is in a swamp or building of retaining walls and drainage.

Also, access to national water and electricity mains as well as proper sewage treatment should be considered. Finding a suitable lot is becoming more difficult as areas continue to get more developed, which is why you should work closely with a trusted real estate agent to get the right piece of land.

Prior Planning: Take time to make sure that all the planning has been done by getting all the working architectural bits and detailed engineering drawings complete with specifications from your architectural firm.

By making all drawings uniform and detailed, you avoid missing details and create consistency that ensures no change orders or lost productivity by the contractor. This makes the contractors estimate accurately as they know what the construction requirements are.

It's all about area per square meter, because no matter how you slice it, every square area you add to the footprint of your new home is going to cost you money, from the foundation to the final coat of paint. Have a floor that has the space you need and amenities you want. Most small modifications can be done for nominal cost. Being your own general contractor can save you as much as 30 per cent.

However, this needs a great deal of work, time and skills. You must plan daily task, schedule sub-contractors, make daily on-site inspections, research and order materials.

Smart Negotiations: Negotiate the materials you intend to buy, including payment discounts, volume discounts and upgrade specifications.

Some general contractors may not work under this agreement. If you can find a willing one, you can save 10 % or more. You won't know unless you ask. Most, if not all general contractors but their materials at a  discount and mark the price up to you for a profit. By eliminating the mark-up, you can cut down on this unnecessary spending.

Finally, make sure you have a clear understanding with your general contractor and his job schedule with the sub-contractors. Your project will be on a strict timetable and you want to do everything in your power to make sure it stays that way.