How to Prepare to Build Your Own Home

by Rachel Lyon, Editorial Director for Direct from the Designers™

Building your own house is a rewarding experience, but it’s also the most complex undertaking most of us will ever attempt. A lot of people get in over their heads before they know it, but careful planning from the start can avert many of the worst disasters down the line. Even preparing the first few steps out of order can cause headaches and require you to change your plans, so here are the major steps you need to take as soon as you decide to build a home.

Figure Out the Money Situation

It’s no secret that houses are expensive; practically everybody relies on credit to become a homeowner, whether buying or building. We can’t overstate how important it is to review your finances, be realistic, and understand how your own decisions can swing the final price tag. Before you even commit to the idea of building your own home, you need to:

Check your credit – That includes your score and your full report. You don’t want to be surprised by any errors or evidence of fraud when you apply for a loan, and spending the time to improve your score before you apply can help you get a lower interest rate and save money over the long term.

Save for a down payment – While it’s tempting to put as much as you possibly can into a down payment, you need to prepare for other costs, too. Estimate how much you need to put aside to move to and furnish your new home, and think about a nest egg for the unexpected costs you can always expect when you build—like the need for a geotechnical engineer to examine the less-than-ideal soil mechanics of your land, among other things.

Look at construction loans and mortgages – You probably won’t be able to get a loan without your plans laid out—including having blueprints, a lot, and a builder—but it’s worth it to discuss with a lender sooner rather than later to see what they’d be willing to do for you. Consider if you want a one- or two-step construction loan, if a 15- or 30-year mortgage looks better, and the type of interest you prefer. This is a complicated process no matter what you choose, so find a local institution that will help walk you through it.

The monetary aspect of building is critical to your success, so we urge you to pause and get your bearings. Land, house plans, and builders will always be available and can wait until you have a realistic budget. It might not be as exciting now, but it will save you a ton of grief in the long run.

Purchase Your Lot

One of the most common mistakes we see is buying house plans before buying the land on which to build them. Location is the most important part of real estate and if you don’t love where you live, a dream house isn’t going to change your mind. Depending on where you want to build, there could be a wide variety of lots available and one design probably won’t work for them all, so you need to commit to a specific lot to know which homes to consider.

Generally speaking, the ideal lot is flat and square. That gives you easy buildability and plenty of space to fit a house and orient it to your liking. An ideal lot is very hard to come by and might not even exist where you are, but that could actually be to your benefit. Sloping lots make walkout basements possible; not only can you finish them into living space, but they boost the main level for more privacy and better views. If you have an awkwardly shaped lot, you should be especially aware of limited dimensions for your home. We most often see this with crowded urban and beach locations that require narrow facades, but you might also find wide lots that lack in depth. A tricky corner lot can be narrow or wide in the front and will need a very specific house shape. Necessity is the mother of invention, and you’ll find some truly unique layouts that make the most of these challenges.

Remember that it’s possible to find and/or modify a house plan for just about any lot, but it can be difficult if not impossible to alter land to suit a house. You’ll save a lot of time and money when you put the lot first.

Choose the Perfect House Plan

This is the most exciting stage of the process for so many reasons! Considering your wants and needs for now and the future, examining blueprints at your own leisure, making plans for every potential space—there’s a lot to experience and most people enjoy the search and ultimate satisfaction of settling on a home that they’ll make their own.

Just be sure you don’t get so wrapped up in the excitement that you fall in love with a great design that doesn’t fit your needs. Start with a checklist of requirements including square footage, preferred architectural and floor plan styles, and how many bedrooms and bathrooms you want. See our Tips for Choosing the Perfect Floor Plan if you need some guidance, and don’t forget that Direct from the Designers™ has house plan specialists ready to help you sort through all of the possibilities to find the one that’s right for you.

Find a Builder You Trust

We’ve included this as the last step, but finding a builder is the most flexible part of preparing to build a home. Some people wait until they have all of the other pieces squared away, while others seek out a builder who will help them find a lot and house plan.

There are benefits either way. If you choose a builder first, he or she can offer in-person recommendations and point out any potential issues that you would miss. Maybe a lot you’re interested in won’t support the city water and sewer hookups you wanted, or it has bad soil that will require special engineering, excavation, and putting the house on pilings, all of which come at extraordinary cost. Customers who wait until the end to find a builder do so knowing that they can choose based on their exact requirements and find somebody who has already tackled projects like theirs with success. That could mean they want an experienced individual to build on a steep lot chosen for its views or to perfectly finish the style of their architecture.

Whatever the case, you need to find a builder that you trust. Treat this like the business transaction that it is and interview some candidates until there’s a good match. Ask questions about their insurance, relationship with subcontractors, and if they think your budget and timeline are doable. Follow up with references and ask how their builds progressed and if there were any issues. Builders should be forthcoming and any evasiveness is a red flag. At the end of the day, trust your gut; you want to be comfortable and confident in a decision that your future home depends on.

If you don’t know where to start, you can search for builders in your state using our Builder Directory. We list plenty of choices, but it’s still up to you to interview and select the one you trust to make your dream home a reality!