Home Construction Loan – Why Building Your Dream Home is a Better Investment Than Buying

Picture your Dream Home. Does it have a hot tub? A screening room? A subterranean garage for your collection of vintage roadsters? Everyone knows what their dream home looks like. So why do so few people actually build it? The truth is that building the home of your dreams often costs less than buying a house on the market. All it takes is good plans, an experienced contractor, and the right financing. Today, that means a construction loan.

In the past, the federal prime rate was so high that it made construction loans very expensive. People didn’t want to pay large sums to borrow funds, so they would finance their home construction with a line of credit on an existing home or by spending their cash reserves. Problems often would occur if the funds ran out or if the project went over budget.

With lower rates now available, more and more people are turning to construction loans. Not only are they economical, they also provide built-in protection for your project to ensure it is completed on time and on budget.

Even with dropping home values, home construction nearly always costs less than purchasing a home on the market. This includes buying a lot or a “tear down” and building from the ground up, as well as adding improvements to your own home or a property purchased out of foreclosure. Borrowing money for these types of projects is better than draining your own funds because, as all good real estate investors know, using leverage increases the return on your investment and allows you to invest your money elsewhere. With a construction loan, borrowers only need to invest a minimum amount of funds into the project (generally 5-20% of total project cost) and can finance the rest. Simply put, using debt to finance the building makes your home an even greater investment.

They also offer safeguards that help keep your project on time and under budget. First, the bank issuing the loan works hard to ensure you are working with a reputable builder. Most banks require that the construction loan request include a contractor package that needs to be approved. If your builder has bad credit problems, past lawsuits or has received complaints to the licensing board, the bank will generally catch this information and reject your builder. Second, the bank issuing your loan watches the construction process from start to finish. Unlike loans that are issued as a lump sum, with a construction loan the bank requires that your approved contractor submit for draws to get reimbursed as each phase of work is completed. The bank even schedules site visits to ensure that the work is done in a satisfactory manner and on time. The bank is offering to do due diligence on your builder and project.

Upon completion of the construction phase, some loans seamlessly rolls to permanent mortgage which is why they are known as a “one time close”. What will you have achieved by building your own home? Even more than the satisfaction of living in your dream home, the result and impact on your balance sheet can be dramatic. Upon completion, you will own a home valued at the full market price of a new home for the cost of the land purchase and construction, often as much as 25-30% less than the retail market value.

How to Find a Custom or Luxury Home Builder

Everyone wants to live in a house where they feel comfortable with. Your home is one of your most important investments. It is important that you do a thorough research about home builders. Custom builders can help you build the home of your dreams. They will be able to take into consideration factors of building your home such as your budget, design, and other preferences. If you are looking for luxury home builders here are some tips for you.

· Create a list of local builders in your area – This is the first step that you should do so as to know how to narrow down all these possible home builders.

· Call or visit the local construction material vendors – These people can actually refer builders for houses who have good reputations. This way you can narrow down your list to your top picks and choose the best among them.

· Ask for your neighbors for referrals – If you find someone who owns a luxurious home that you like, you can ask them to refer the builder that made their home as well. Referrals from relatives, friends and neighbors can be a good source of quality builders.

· Do a background check of your prospect builders – You might have already gotten a few referrals and this time you need to see for yourself if these prospect construction builders are capable of doing the job you want them to do. The best way to check the quality of their work is by asking homeowners who have hired them to build their homes.

· Check the quality of materials used – When you go for a background check, check also the quality of material used for construction. If it is a luxury, it is understood that the materials used costs more than normal. This also means that the quality of these materials is better. A quality construction builder service provides you with construction materials worth using to build the home of your dreams.

There might be a lot of things to do if you are looking for a quality house builder. All the effort is going to be paid if when you feel secure that you will also build a sturdy home that you and your family will be able to stay with for a long period of time. Custom house builders, as well as custom home builders can suggest you new ideas and designs for your ideal home. They can assist you in building a home that can offer you luxury and comfort. Luxury home builders would be easier to find if you know how to narrow down the list of your possible builder for your new home.

Building Green – Getting Started

Building green is becoming more and more important as our resources dwindle, and we become more aware of the sensitivities to toxins that many people have. With the price of oil and natural gas rising, saving energy is a big concern. The use of green construction in home and business developments has started really taking off, and many people are interested in making their developments environmentally friendly. One survey found that at least fifty percent of all builders should be producing at least some green developments by the year 2010. However, once you’ve decided to build green, it can be difficult to know where to start. If you’re an investor or developer who’s interested in learning about the process of green building, here are a few basics to help you get going.

Currently, the building industry is centered on those practices which are least expensive, and easiest to implement. Unfortunately many of these practices aren’t all that green. From the use of adhesives and materials that can off-gas, to the creation of structures that waste heat and water, a conventional building makes a big impact on the world around us. You can make buildings greener in a number of different ways, including using natural and non-toxic materials, improving air quality, reducing waste of energy and water, employing renewable energy sources, and reusing materials whenever possible.

For those developing a property, or investing in a development, building green can be especially difficult. Individuals who are building on a small scale can more easily exercise control and find green solutions. Larger developments require advance planning, and there isn’t currently a standard process for green building. However, working with experienced professionals can help a lot. For instance, it’s often a good idea to work with an energy consultant, who can help you decide how to implement designs that will allow your buildings to conserve energy more effectively. Conservation of energy is one of the biggest concerns related to green building, since most buildings do not make efficient use of power. Correct building orientation to make use of passive solar design, efficient heating and cooling systems, and high grade insulation are just a few of the options you can put in place to make your developments more energy efficient.

You should also try to work with contractors who have prior experience with green building. This will help head off possible problems later on. A contractor who has built green structures in the past will have better familiarity with the methods and materials that are used. They’ll also be more willing to work with you, even if the process required to make the building more environmentally friendly means more work on their end.

Since building with environmentally friendly and recyclable materials can be more expensive than conventional building, developers should also make sure they do their research in advance. Look at the cost of materials available, and design your budget appropriately. Be sure to factor in the increase in sale price for green building, and the improvements in energy efficiency when you decide what materials are most cost effective. Materials that are more expensive now will bring savings down the road. Even if you’re developing the property for resale, buyers will be aware of this, and may be willing to offer a higher price.

Development often requires the removal of existing structures. Standard practice is to demolish these structures, with the rubble usually being taken to the local landfill. To make the process of getting rid of unwanted structures more environmentally friendly, focus on deconstruction rather than demolition. Deconstruction takes longer, but allows the materials to be reused or resold, and saves on tipping fees. If the structures in question are older, they may have been built from materials which are no longer available, like large dimension old-growth hardwood, which can be reused in other buildings and is superior to softwood dimensional lumber.

Another place where many modern buildings create waste is water use. Very few structures are designed to make efficient use of available water supplies. As more sources of water become polluted, and aquifiers are emptied, water conservation becomes a greater concern. Plan on using features that save water in your new development. These can include installation of ultra-low flow toilets and showers, faucet aerators and high-efficiency showerheads, efficient heating and cooling systems, and use of air-cooled equipment instead of water-cooled. In addition, it may be wise to designate a water efficiency coordinator for large projects.

The nationally accepted benchmark for green buildings is the LEED (Leadership in Energy and Environmental Design) Standard. LEED certification provides independent, third party verification that your building project is an environmentally responsible one. Even if you do not choose to get this certification, being familiar with LEED standards can help you make the right choices when building green.

While getting started in green building can be intimidating at first, familiarity with standards and talking to experts in the field can make the process a lot easier. Energy and water conservation are two of the biggest concerns, with use of recycled or recyclable, non-toxic materials, and reduction of landfill use following. With a sound plan and the correct priorities, making your development a green one doesn’t have to be hard. Green developments are turning up everywhere, from water-saving condominiums built of recyclable materials where decaying industrial buildings used to sit, to schools and businesses designed to make the best use of energy while providing good air quality. Slowly, green building is becoming mainstream, so now’s a great time to get started.

How To Maximize The Resale Value Of Your Custom Home

We love the idea of building a custom home, right? A custom home is meant to fulfill your specific wants and needs. This kind of freedom of choice gives us the liberty to design a home to our heart’s desire, but it can also be our worst enemy. At the time of building, you can only think of what you need right then and there. However, you may not always live in this house, correct? What happens 10-15 years later when you decide to move? Have you cut your own head off by choosing some poor design concepts? It’s quite possible, and is many times the case. Your custom homebuilder is trying to satisfy your every wish, and they don’t want to insinuate that you don’t know what you’re doing. Often, you won’t find out until it’s too late. Here are some common mistakes we see homeowners make when building their custom homes.

Niche Homes

It’s amazing what you see as a custom home builder. The things that people create are great for them, but no so great for others. While you should certainly build to your tastes and create an ideal home, you shouldn’t stray too far from the conventional standards. For example, maybe you think you only want one huge bedroom if your 4,000 square foot home, but odds are, that big of a house will resell to a larger family. One bedroom won’t do them much good. Try to use common sense and accommodate your custom home needs.

Bad Location

When it comes to resale value, one thing is for sure…location matters! While your dream may be to have a huge country custom home 50 miles from the nearest metropolitan area, you better believe that it will have a negative impact on your resale value. Most people want to live in areas of convenience. Try to pick a location that can be considered a compromise. Do a little research to get some background statistics of the neighborhood you’re trying to build in. For example, how many new homeowners are there annually? How big are families? What’s the average income? Where are the nearest grocery stores? Where are the nearest shopping malls? From there, try to make an educated decision on where to build your home.

Maximize Your Selling Rooms

When people are in the market to buy homes, two of the rooms they pay the most attention to are the master bedroom/bathroom and the kitchen. People love large, custom kitchens with quality construction. Granite and stainless steel designs are especially enticing to new home buyers. As far as the master bedroom goes, try to create large open rooms with higher ceilings, and maybe a walk-in closet. For master bathrooms, installing Jacuzzi bathtubs and his and her vanities in this room is always great for resale value.

These are just a few tips that will help ensure that your home is not only comfortable and realistic for you, but for others as well. The last thing anybody wants is to have a home on the market for too long, especially if it’s a result of our own bad decisions. When building your custom home, plan for the future as well as the present.

Benefits of Custom Homes

When it comes to investing your hard earned cash into a home, you have two options. You can buy an existing property, maybe do some renovations to make it your own, or you can build your own custom home based on your unique needs and requirements.

For many people the building process is a long and daunting one, often one they don’t want to go through, but with the right builder by your side, a custom home provides you with a range of benefits you wouldn’t ordinarily get when it comes to buying an existing property and changing it accordingly. In fact buying an existing property and making changes will cost you more in the long run than building your own.

The first benefit to a custom home is that you get to enjoy a unique design that has been drawn specifically for you based on what you like and your particular family needs. You aren’t restricted by an exiting design or by a chosen design based on area, you can create your own space, working alongside an architect who will incorporate what you feel is important to create your dream home for you to enjoy for years to come.

When it comes to a custom home you get your preferences rolled into one with your house being designed from top to bottom to suit your needs and requirements from materials to number of bedrooms and spaces to additional extras and more. The architect will sit down with you, learn about you and what you like along with what you feel is important. They will then create a design for your approval which will incorporate all that you have spoken about to provide you with a finished design that ticks all the boxes.

If you are looking to enjoy a greener lifestyle, focusing on using environmentally friendly elements to create your dream home, then this can be added. This is your chance to build a custom home focusing on energy efficiency, lowering your carbon footprint and building a home you believe is going to meet your needs well into the future, a home you want to live in now and moving forward.

With a custom build you can identify what you feel is important for you and your family and have those important elements added to your design. You may collect vintage cars and need a large garage to accommodate them or you may work from home and you need a big office space to run your empire. You may even want to run your beauty business or art studio from home and need a spacious and light space where you can conduct your business with ease and confidence.

Another benefit of a custom home that you may not have realized is how reduced maintenance costs are. Remember everything is brand new, your building work, garden and even your appliances. This means those are under warranty, so in the event that something goes wrong and they need require, the cost is not for yours. This helps you save money in the long run.

A custom home is a brand new home that has been built for you. You are part of the process from your wish list of what you want included to watching the property be built from the ground up using the materials and accessories you have chosen along the way.

The day you officially move your furniture in and make it your own, you can look back on the custom home process and for many, they want to do it all over again, adding things they may not have thought of the first time around.