How to Choose the Best Custom Home Builder for Your Dream Project
When it’s time to find a contractor for a custom home, many people assume they should send the design drawings out for competitive bids, thinking it’s the best way to compare pricing. However, choosing the right builder requires more than just a pricing comparison. There are deeper factors to consider.
The key to selecting the right builder is finding a partner who aligns with your goals—one who understands the vision for your home and prioritizes quality, communication, and transparency. Pricing is only one part of the equation; it’s equally important to consider their billing practices, approach to project supervision, and overall fit with your personality.
Understanding Your Needs
Selecting a custom home builder is about understanding your unique needs and how different types of builders can fulfill them. While there are many builders out there, not all are suited for every type of project. Before selecting a builder, understand your project’s scale, budget, and timeline. Do you need someone with a lot of hands-on attention, or is a more affordable option acceptable? This clarity will guide your search and set you up for a successful build. Here are two common builder types:
General Contractor: Sole Proprietor/Solo Operator
This type of builder is often a one-man operation, handling everything from planning to construction. While this can keep costs lower, it can come with risks. With only one person overseeing multiple projects, the attention your project receives might not be as thorough. Without being available to be at the project every moment, they often rely on subcontractors to handle different trades, which can lead to miscommunication or missed details.
General Contractor: Larger Team with Employees
These builders operate with a full-time staff, including project managers, site supervisors, and in some cases, skilled labor. They’re able to offer better supervision and more hands-on management, ensuring that your project moves smoothly from design to completion. While their services are generally more expensive, the investment often pays off with fewer delays and greater conformity to the design drawings.
Researching Potential Builders
Finding the right builder isn’t as simple as picking a name out of a hat. A little research will go a long way in helping you make the right decision. Here's how to get started:
Referrals and Recommendations: Ask your design team for suggestions. Architects who design custom homes are well-connected in the industry and can recommend builders with proven success in luxury home design. They can also help gauge whether a builder’s style fits your project.
Online Research: Begin by browsing websites, reviews, and portfolios. Look for builders that specialize in custom home architecture, and pay attention to the kind of homes they’ve built. The style of homes they have built is less important than the level of detail, quality, and complexity.
Asking the Right Questions
Once you’ve narrowed down a list of potential builders, it’s time to ask the right questions to ensure they’re a good fit. Here are the key points to cover:
Experience with Similar Projects: Make sure the builder has worked on projects of a similar scale, complexity, and price range. Their experience with modern custom home designs or luxury home construction can make or break your project.
Project Management and Supervision: How will the builder structure the supervision of your project? Do they have a dedicated project manager? A streamlined structure ensures the project stays on track, without unnecessary delays.
Communication: From pre-construction to project delivery, it’s important to have open lines of communication. How will the builder update you on progress? Will they be available to address concerns throughout the project?
References: Past clients’ feedback is invaluable. Ask for references, and don’t shy away from digging into both the successes and the challenges. How were issues handled when they arose?
Contract Terms: What type of contract does the builder offer? Fixed Fee or Cost Plus? If Cost Plus, what’s the markup? Make sure you’re comfortable with the financial structure before proceeding.
Reviewing Proposals and Contracts
Once you’ve asked the right questions, you’ll receive proposals from your shortlisted builders. This is where careful attention is key.
Comparing Proposals: Look beyond the numbers. While bottom line price is important, the three main items that you should look at are:
Percentage of mark-up
The ‘plus’ in a cost/plus contract. The going rate for custom home builders can range from 8% to 25%. What rate is shown in the proposal is a function of the overall project scope and projected cost. Other factors that affect this rate is how supervision time is calculated and what part of the project is captured under General Conditions
Supervision
Project supervision can be structured in several ways depending on how the contractor has structured their business. If the contractor is a sole proprietor, they may not charge for supervision. If they are a slightly larger operation, they may have a project manager as well as a site supervisor dedicated to your project. The time of a project manager might be calculated on an hourly, daily, or weekly rate.
General Conditions
The General Conditions portion of a project contract covers the incidentals and non-direct cost of constructing a home. This often includes things like the dumpster, portable toilet, miscellaneous tools, and site clean-up.
These three items affect one another, so it is best to understand them as a whole. One proposal might have a really low mark-up percentage, but have higher supervision and general condition costs. While in another proposal, the opposite might be true.
Contract Review: Pay close attention to the payment schedule, any clauses related to change orders, and dispute resolution. A solid contract should clearly outline expectations, timelines, and responsibilities.
Establishing a Strong Working Relationship
A custom home project isn’t just a one-off transaction—it’s a long-term collaboration. The builder you select will play a critical role in the success of your project. Clear communication, mutual respect, and a shared vision are crucial.
Working with the right builder means you’ll have a trusted partner to guide you every step of the way, ensuring the final product reflects your vision and stands the test of time.
Finding the Right Custom Home Builder for Your Project
Choosing the right builder is essential for the success of your custom home project. Take time to research, ask the right questions, and carefully review proposals to make the best decision. The builder you select will shape your home—and your experience—so choose wisely.
Contact bldg.collective if you’re ready to start your dream home. We’ll collaborate with you every step of the way, including when it comes time to find the right builder for your project.
