Is it Hard to Get Finance as an Owner Builder?
It can be challenging and frustrating but can being an owner builder can also be ultimately rewarding.
One of the best tools you can arm yourself with before you start is information and knowledge. Before you decide to be an owner builder, you need to source information about where to start gathering information about Owner Building, obtaining Owner Builder construction loans and ultimately saving money.
Your local council should be one of your first ports of call. Most councils in Australia have information about the regulatory requirements as well as general information about Owner Building. Try the Customer Service Dept first and then speak to the department directly. They can answer also answer specific questions such as boundary fence issues.
When working as an owner builder, the integrity of the tradespeople you use is vital. If possible find your tradespeople through referrals and make sure you follow up all references. Ask lots of questions and take your time making sure that this person is the right one for your owner builder project.
Of course learning everything in the world about becoming an Owner Builder won’t help at all if you can’t get the finance to make the project a reality. It is very important that you are realistic about your budget. There are many free calculators on the website that enable you to calculate how much our project will cost and how long it will take.
One of the issues with becoming and owner builder is the way properties are often valued. A common technique is to add the value of the land or existing property to the cost of construction. This valuation process, however can work against the Owner Builder.
There are many ways you can save money on your owner builder project. Here are some common ways owner builders reduce their costs and see if they work for you. Always get as many quotes as possible and make sure you shop around. Visit building supply auctions – you can find them through the local paper. Visit seconds outlets – sometimes something with damaged packaging (that you throw away anyway) could save you hundreds of dollars. Cash and Carry shops have a surprising range of products.
Insurance is an area where you can save big money when you are an owner builder if you know where to look and what questions to ask.
It is of course very important that before you become an owner builder you make sure that the potential savings are worth the time and effort you will need to spend. Builders are often able to employ economies of scale to purchasing and can often get materials much cheaper than the average owner builder. This means, that even after they have put a margin on top, material costs may still be cheaper through a builder.
As a general rule, Owner Builders are more likely to make significant savings on mid to higher construction values and on projects designed by an architect.
There is no reason that just because you aren’t from the industry, it doesn’t mean you can’t become an Owner Builder. It just means you need to find a builder who can help you add to your skill set. Many credible builders are happy to enter an arrangement where they Project manager the job for you in return for an arranged bonus. This arrangement means you get professional expertise on site without losing the cost savings on materials and labour.
It is of vital importance that when you do your research on becoming an owner builder, you make sure that all information is current. As with most industries, there are constantly innovations and changes. Subscribe to industry magazines and make sure you know what is going on.
Don’t underestimate the time it will take to complete the project Weather, tradesmen’s schedules are just two of the factors than can slow your project down. Do your research, calculate how long you think it will take and then allow for extra time. If you finish earlier – great news but if running overtime can have significant financial implications.