Something new to look for!
April 9, 2008, 3:58 pmWow, things change fast with APS’s policies about the cost of power when building your custom home.
As many of you know or don’t know, APS once provided 1,000 feet of free power when you built a custom home. Then last year they changed their policy to providing the home builder a $5,000 credit towards running their power. Now, on February 27th of this year they have decided to again change their policy so you have to pay for the entire cost of running power to your new home.
In a recent lot split I paid APS almost $15,000 to run power 500 feet. In addition, it cost another $10,000 to run the conduant for the power. That’s $25,000 for 500 feet which calculates out to be $50 per foot.
Now this may not seem like much to alot of you, however, I have a customer that has to run 2,500 feet of power to his home. It is going to cost him $125,000 just to get power.
So, if you haven’t already purchased a lot for your custom home, keep in mind you want to know just how far you are going to have to run power because it will definately effect the bottom line cost of your home.
Rich Egly, Canyon Home Builders
—rich | no comments
(posted in the Uncategorized category)
Saving Money on Your Custom Home
March 6, 2008, 9:32 amThis is a subject that we could talk about for days. How do we save money when we’re building a custom home?
Let’s start with your plans. Here at Canyon Home Builders we use a term we refer to as “Value Engineering”. Architects are like artists, they have their own niche or own way of designing homes that makes them different from other architects. They design things in your home that maybe different from any other design, which is what a custom home is all about. Your building a custom home because it’s probably your dream home and you don’t want a home like anyone elses. However, a lot of times they design things in your home that are expensive to build. With minor changes to those plans you may save thousands of dollars when you go to build.
Another way of saving is to insure you get multipul bids for every job. Here’s an expample of what we just experienced on a home we are building in Goodyear. We sent bids out to four framing contractors for labor only on a 3,900 square foot home. This bids came in as follow:
Contractor #1-$42,000 Contractor #2-$37,000 Contractor #3- $27,000 Contractor #4-$23,000
As you can see, the prices varied substantually. Now, imagine having 20 different subcontactors bidding 20 different items. Imagine how much money you can save.
You can also save buy building a shorter ceiling heighth. If you were to build a home with a 12 foot ceiling vs a 14 foot ceiling you save 2 foot of material and labor on your entire home.
All of these different items can add up to thousands of dollars. It is not one major item that will save you a lot of money, however, if you save a little hear and a little there throughout the entire home, you will save thousands of dollars.
Rich Egly, Canyon Home Builders
—rich | no comments
(posted in the Uncategorized category)
The Big Easy
February 19, 2008, 3:43 pmWe talk to a lot of people everyday about building a new home. For the most part, people believe that building a new home is a daunting task and too much work. The truth is, building a new home can be a very easy and enjoyable process. The overwhelming feeling of where to begin and what is the next step can make this process very difficult. With a good builder, one that has a process, this feeling can be overcome and the custom home building experience can be rewarding.
The process of building your new home starts with location and land. This might be the most difficult process, knowing where you want to live and finding a good, affordable site. Once this process is complete, it is as easy as knowing what you want in your home and how much money you have to spend. Good builders will be able to help you from the very first step and guide you through the process until the end.
The rewards of building a new custom home are plentiful. The first is, you have a home that has everything that you want and is built to suite your needs. You have designed all aspects of the home, it is a reflection of your family and their needs. The next reward is equity, building a custom home often comes with built in equity. Most custom homes, when done correctly, are worth more than what the market says.
For very little effort, you can build a home that is tailored to your needs and is worth more than it cost. The process is easy.
—Kevin Montgomery | no comments
(posted in the Uncategorized category)
Costs in Building a Custom Home
January 24, 2008, 10:11 amI have received many questions about what up front costs there are in the building of a custom home. Even though we budget everything in your home and the construction loan for your home covers everything, there are certain costs that customers have to pay up front and then are reimbursed in the first draw of the construction loan.
These items include the house plans, grading and drainage plans, and any engineering that needs to be complete prior to start of construction. Starting from scratch, a new home design will cost between $2.00-$3.50 per square foot depending upon the architech you hire, grading and drainage plans may run from $1,500 on up depending upon you lot size and engineering will also run about $1,500 on up.
The cost of all these items will be reimbursed to you at the first draw which is when the concrete foundation of your home is complete.
If you have any other questions about what up front costs there are, or if you like and estimate, please don’t hesitate to contact me for the most up to date accurate information.
Rich Egly, Canyon Home Builders
—rich | 1 comment
(posted in the Uncategorized category)
What is R-Value
January 14, 2008, 5:56 pmMany home owners have questions regarding Insulation R Value Ratings. Most of us know that the higher the number the better, however, there is more to it than that. R value insulation ratings are used to measure the ability to resist heat flow. The higher the R value, the more effective it is.
R value performance testing is done in a 70 F environment with no air movement. Ironically enough, when you need insulation the most you’re generally not in these ideal temperatures or conditions. This can result in the rated house insulation R value being higher than the actual effective R value.
When considering insulation, think in terms of a whole wall system. A whole wall system takes into account the Doors, Windows, Drywall, Framing and Stucco/Siding System. Each of these items have an R-value rating and make up the Whole Wall System R-value.
It is my opinion that traditional construction methods in conjunction with High SEER Rated HVAC units, New Efficiently designed HVAC Systems, R-23 Insulated Wall Systems, R-49 Attic insulation and Low-E Glass are the best bang for the buck. There are other products out there but do not yield a high enough rate of return for the cost.
—Kevin Montgomery | no comments
(posted in the Uncategorized category)
Cost Plus vs. Fixed Price
January 7, 2008, 2:18 pmMany people have asked what’s the difference between a “Cost Plus” and a “Fixed Price” .
A ”Cost Plus” estimate is where a builder passes the actual cost of the construction to the customer and then charges a fixed fee per square foot to manage and supervise the construction of your home.
A ”Fixed Price” estimate is slightly different in that the builder gives you a fixed price of what your home is going to cost you and it will not exceed that price.
Now you may ask, “Which is better”. Well, it depends on you situation, but in most cases the ”Cost Plus” will save you the most money and here is why.
Certain prices fluctuate, such as lumber materials and plumbing materials. Most subcontractors only guarantee prices for 30 days. This does not allow a builder to lock prices in long enough to ensure that prices will not fluctuate and cost them additional money. Therefore, if they agree to do a “Fixed Price” a builder will usually increase or (fluff) their estimate to ensure they don’t end up eating the cost of any price increases. This can ultimately end up costing you a lot more money depending upon how much a builder fluffs those costs.
Here’s an example: Let’s say your building a 3,000 sqft home and it will take 6 months to build. At the time you meet with your builder it’s going to cost $100 per square foot to build you home. The actual hard cost for material and labor is $75 per square foot and the builder is going to charge you $25 per square foot to manage and supervise you home. In this case your home would cost $300,000 to build.
In the time it takes to build your home, framing material and plumbing material costs went up slightly. Let’s say they went up enough where it cost an additional $2 per sqft. If this happens in a “Cost Plus” scenario then it would actually cost you $306,000 for the construction of you home. There was a increase of $6,000 for framing and plumbing materials.
In a “Fix Price” estimate, most builders, if they have to brunt the risk of price increases, will inflate their estimate approximately 10% to protect themselves. So instead of having your home built for the $300,000-$306,000 price range now you are paying $330,000 for that same home (the estimate $300,000 plus 10%). And the builder just made an additional $25,000-$30,000 for the same job as a “Cost Plus”.
This is a great subject to discuss. If you or any of your friends or family have more questions on the subject. Feel free to ask. That’s what this blog is for.
Rich Egly, Canyon Home Builders
—rich | 2 comments
(posted in the Uncategorized category)
Merry Christmas and Happy New Year
December 27, 2007, 2:22 pmAs the new year approaches we at Canyon Home Builders are looking forward to a outstanding new year. A great Christmas launched us into 2008 and we are looking forward to new challenges that the new year may bring. We have a very diversified plan for 2008 as we will face these new challenges and hurdles in the housing industry. We realize we will not see the same market as we have in the past, however, we believe change brings new opportunities and ways to learn and adjust to what people need relative to their homes. We look forward to being able to help families refresh their current home or to build new ones. The opportunities for 2008 are abundant!
We wish everyone a great Holiday Season and prosperous 2008!
—Kevin Montgomery | no comments
(posted in the Uncategorized category)
Buy or Don’t Buy
December 17, 2007, 6:26 pmMany people have asked me if now is the time to buy or should they hold off for a while longer. I think that depends on whether you are purchasing land or homes. If you are thinking of purchasing a home in todays market, where there are 56,000+ homes for sale, I would say that we have not reached the bottom yet and to hold off at least another 6 months and make an evaluation at that time.
On the other hand if you are looking to build your custom home in the next few years or you possibly want to build spec homes in the future now in the best time to purchase land for those investments.
You see, people can build homes until they are blue in the face and you will always be able to build more homes. On the other hand, you can not build more land.
Prices on land right now in many locations are as low as they were 4-5 years ago. I don’t feel they will go down much lower. Currently you can purchase land for as little as $40,000 per acre in parts of the northwest valley.
You may be asking then, “Why aren’t more people buying land right now?” It’s because most people are real estate rich and cash poor. They have a lot of money invested in their real estate at the moment and it’s not selling so they can’t purchase anymore. One of the keys is being liquid enough to purchase land now, so you can capitalize on those existing low prices. Purchasing now will not only make more money for you in the future, but also allow you to get more ’bang for your buck’ when or if you decide to build on that land.
So if you have the money available, and your looking “long term”, consider buying land. I don’t think you’ll be disappointed.
Richard Egly, Canyon Home Builders
—rich | no comments
(posted in the Uncategorized category)
December 14, 2007, 8:49 am
During current research by Realtor Richard Egly, co-owner of Canyon Homebuilders, we have found land prices plummeting. With the decline in land prices, opportunity is abundant for someone looking to build equity in their home or just benefit from a mid term investment. Real-estate has long been a very lucrative investment source for people looking for mid to long term growth. We have all heard stories of our grandparents or parents missing the opportunity to buy inexpensive land, now that land is worth 10 times what they could have bought it for. These kinds of purchases are still real today, we just need the foresight to see them. A friend of mine just recently told me a story of a wealthy real-estate investor, who gave him some advice. He said that his businesses were just a means of buying real-estate, which is where his real money was made.
—Wendy Leslie | no comments
(posted in the Uncategorized category)
December 11, 2007, 12:12 pm
Introductory Blog
As part of our business, it’s our responsibility to be on top of the housing market, not only the home builders market, but the real estate industry as a whole. And, over the past few months we’ve been astounded by the media’s consistent and constant negative spin of what’s going on in the marketplace. It feels like every time I turn on the news I am bombarded with only the negative and none of the positive of our current housing situation. (I know, I know, I shouldn’t be shocked, as this isn’t the first time the media has blown things up for ratings, but I still remain shocked though). And, what concerns me even more, is the stories that the media is repeating on each newscast are now becoming myths. Myths that perpetuate and grow each time they are told. There are plenty of myths that have far outlasted the data that showed them to be wrong (“The Earth is flat”, “Heavy objects fall faster than light ones”) and I don’t want the housing myths to go into the same abyss. That brings me to our new blog. We thought it was time to turn the negative into positive and begin sharing our thoughts and today’s technology is lending a helping hand. So, join us on our journey as we help to dispel the myths, provide you with essential tips and how-to’s, and communicate our random thoughts as it relates to the real estate and home building markets.
—Wendy Leslie | no comments
(posted in the Uncategorized category)
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