Building a dream home means building a house with the amenities you and your family desire and offers a place for your family to live comfortably and grow. Everyone has a dream home in his or her mind, but when the time comes to build your perfect home, the process can be less than magical. Thankfully, Lincoln offers aspiring dream homeowners with resources for constructing a quality home from scratch.
Why Build?
Jim Christo of Christo Design Build explained, “This is a perfect time to build! Interest rates are still at historic lows. Material and labor prices will never be lower. But buyers beware—once the homebuilding industry really starts heating up so will the prices!”
Bob Schultz, owner of Schultz Construction, advised, “One of the biggest advantages of building is you can get what you want.
When you buy a house you can’t get everything you want. When you build a home, you can build a home to fit your needs and your family needs. I’m seeing prices for building lower than it was five and six years ago. It is more efficient to build now than a few years ago. A lot of people think it is a hassle to build, so they will buy existing and live with what the home has instead of what they could have with a custom home. With a build, everything is new, and you are the original homeowner. You are putting your own signature on your home.”
Where to Begin
Owner of Christo Design Build, Jim Christo, explained that the first step of homebuilding is talking to a lending institution and getting pre-qualified for a home mortgage. Next, establish a budget with which you are comfortable. Third, choose the location that is right for you. Jim suggested that you “consider the neighborhood and opt for the one that best fits you or your family’s lifestyle, based on whether you have children in the home or have an empty nest. Consider the following:
–Desired school district
–Travel time to and from work and amenities
–Desired type and style of home (one, one-and-a-half or two-story, flat, daylight or walkout lot)
In order to get a better idea of the style of home you would like, Jim suggests collecting photos of exterior styles of homes and looking online for ideas of floor plans and exterior designs. The fourth step is to choose the right the builder for your home.
Choosing a Builder
Once you make the decision to build your own custom home, the next step is to choose a builder to bring your dreams to light. Bob Schultz advised, “I think one of the biggest things to do is research. Research the area and research the builder.” Make sure that the builder is reputable and successful. Many builders and subcontractors are no longer in business, but the ones who have made it through economic difficulties are likely not going anywhere now. Thus, make sure that a builder is financially sound. Bob suggested checking with banks and looking at how long a particular builder has been in business. Bob explained that he often gets calls from someone who owns a house built by someone who isn’t in business anymore. It’s important to know that your homebuilder will be there for you to offer support after the home is built.
Jim Christo advised, “Find a builder who has been in business for at least five years. Spend time researching—more time than you spend researching a car or furniture purchases. This will be the most important and largest purchase you have ever made. Make sure you do your homework so you are not disappointed. Check references, ask everyone you know, ask building supply firms, call the BBB and make sure the builder is a member of a professional organizations such as the local Homebuilders Association.
You will be entering a life-long relationship with your builder. It is critical that you have trust and easy communication with him or her. You should also make sure they are good listeners to your wants and needs.”
Stonybrook Homes owner and builder Troy Karsting recommended choosing “someone who listens to want you want, will communicate with you directly and lets you know your home is special to their program, it’s not just another house.” Troy explained, “I am extremely involved in each project I work on. Building a relationship with each customer is very important to me so that I know we will have a satisfied buyer when the home is complete. I always tell the buyers I work with that building a home should be fun!”
Randy King with King’s Home Inspections inspects completed homes and he had some additional insights to offer about choosing a builder. He said, “When selecting a builder, interview several of the builders’ clients to see what their experiences were like. Be realistic in what you can afford for finish levels. You can always finish a basement later or upgrade fixtures or cabinet faces as finances allow, but adding or enlarging rooms, changing quality of windows, etc. can be very costly. Good planning and foresight is the key to happiness in your home building experience.
“Bottom line is: Do your homework. Seek out past clients of a builder, interview them and learn from their experiences. Take notes. Make a plan, but be open minded and flexible. Interview several builders. Look at their warranty plans. Use a checklist and ensure the details are covered in the agreement with your builder. Be realistic. A home is a combination of thousands of individual components, assembled by tradesman. Occasionally a component will fail. If you call your builder and they back out for every minute repair, your relationship with them will quickly deteriorate. Then when a major issue arises, they will be less enthused about solving the problem. Homes, even new ones, require ongoing maintenance and occasional repair. Have your home inspected for Termite/Wood Destroying Insects and tested for Radon gas at least every two years. These issues can arise at any time.”
Real Estate Agent
Enlisting the services of a real estate agency will ensure that you are guided through the process of buying and/or selling home. Eric Lemke of HOME Real Estate explained, “Building is a very big and expensive step, usually the single largest purchase in one’s life. Buyers should have someone looking out for their interest in the transaction and making sure all the terms of the contract have been met. There are several aspects of a new construction contract that need to be addressed including how changes to the contract will be handled. An agent that works with new construction knows how to address these issues at the beginning, and they make sure their clients are protected throughout the process. What’s most important is that you, the consumer, is happy with the finished product and you are buying exactly what you thought you were when you signed the contract.”
Eric continued, “A realtor should be involved from day one, speaking to the builder and even before. Agents have a great network of builders that specialize in certain types of homes. Talking to an agent first could save you time and get you in the right direction from the first step. From the initial design stage to move in date can take about a year. With an agent that specializes in new construction they can help you get to move in day faster.”
That being said, choosing the right agent is essential to ensure the proper guidance through the building process. Eric said, “Choosing an agent that knows and understands the building process is important. An agent that is knowledgeable in new construction can save you time and money and keep your interest protected throughout the building process. There is a lot to be said about an agent who knows how to read blueprints, and reads them often. Having an agent be able to look at something on a blueprint that looks perfect and make a recommendation to move something or make something bigger or smaller can save lots of headaches later. As an agent builder, I think it is so important for buyers to work with agents. It is likely there will be unforeseen issues that will come up in the building project. The agent will work as a mediator and can usually help rectify the differences. An agent also makes the process go so much smoother.”
Trends
Bob Schultz, owner of Schultz Construction highlighted some of the trends on home building. Overall, Bob said, “People are starting to come out of their shells. They are starting to look at houses again; they are buying and selling.” Bob explained, “I think that there is going to be a demand for new houses, and that demand is going to cause prices to rise. You can’t find a better time to build than right now. Houses that are priced right are selling overnight, and some higher priced homes are taking a little longer. I think a lot of builders that I know are seeing a turning point. It is very encouraging. In the good days, there were a lot of builders. Through this, a lot have them have gotten out of the business. The ones that have survived in the hard times are going to be here to stay. I’ve gone back to physically working on our jobs, but I don’t mind it. My wife always says to me, ‘If a homeowner sees you working there on the job, laying a wood floor, it will mean something to that homeowner.’”
Currently, Schultz Construction has a parade home that people can view or buy if interested. The company has developed a subdivision called Raven Wood and has been successfully selling lots. Bob said, “We sold four lots in about three-and-a-half weeks weeks. We are down to about a third of our lots left.” This opportunity is valuable for anyone who is considering building in the future, because such opportunities to choose land are infrequent.
Jim Christo’s joint venture with Steve Fulton, South Shore at Waterford Estate, is another new development that those who want to build might consider. South Shore’s Spring Parade home is a resold custom townhome and they just sold a custom single family home with construction starting in May. This home will be one of the largest sold to date and will be their Fall Parade of Homes entry.
Jim Christo Design Build echoed Bob’s observations on trends and provided a few other insights. He highlighted the following trends:
–Open floor plans with properly placed windows for extending views to the outdoors.
–Formal living and formal dining rooms have lost steam to make way for larger, more open great rooms and dining spaces off the kitchen. All new trends in home design are reflecting that.
–Less carpet and more wood and tile flooring.
–Multi-purpose “flex” rooms. This could be a bedroom that can be converted to a Study, Exercise or Hobby Room.
–Soaking tubs or oversized walk-in showers replacing the whirlpool tub.
–Lots of storage spaces
–Energy Star and Green built homes are very important to most new homeowners. The most demanded features are high efficient heating and cooling systems and quality windows
Jim added, “Good home design is becoming more important than ever. It used to be the bigger the better. Now it is smaller, but smarter. Most new home owners still want to feel proud of their home but would rather have a well-designed, architecturally pleasing home with less square footage than an over-the-top mansion. In addition to new trends entering the market, Jim explained that once-popular home design trends that are on their way out are two-story family rooms and two-story foyers.”
James Lamb with Goings Custom Homes advised, “We are sophisticated enough in our technology to combine our mortgage payment and utility bills so that when making decisions about ‘how efficient to make your home’, you can spend your money wisely and not overspend when you are building.” James also explained that he has noticed more people spending money up front, so they are able to save money throughout the upcoming years of their home ownership. Goings Custom Homes goes above and beyond to ensure the energy efficiency of a new home. James said that what sets them apart is the “attention to the details that will keep your home energy efficient and healthy for your children and grandchildren and the ability to still be standing in 100 years.”
Troy Karsting with Stonybrook Homes explained,“We are seeing buyers go with less square footage yet maximizing the space they have to work with for efficiency and price, yet still keeping high quality amenities such as tile floors, granite countertops, etc.”
Industry Changes
Jim Christo also highlighted some trends in the local construction industry.
–New energy building codes went into effect March 1, 2012. The initial increase in the costs to implement these codes into the home will be result in lower utility costs.
–Building permits for new home construction are showing signs of improvement over this time last year.
–Residential property values have increased approximately 4.77% in Lancaster County in the last year per The County Assessors Office.
Jim also explained that there is pent-up demand for building a home. He said, “We are finding there are people who have been wanting to build and are getting tired of waiting for the market to bounce back. This is especially true for the baby boomers. If they have the financial ability, many are going ahead with their plans to build. They want to enjoy their life now.”
Landscaping
Ken Svoboda of Ray’s Lawn and Home Care provided some insights about the planning the landscape for a new custom home. He explained, “I’m part of the team. Builders and/or homeowners bring me in to the process at the design stage. While this is a very fluid time in the process, I provide input into the exterior design of the home from driveway, sidewalk and patio design to the more elaborate designs of outdoor kitchens and living spaces, retaining walls, water features.” Ray’s Lawn & Home Care can aid in the design, cost and installation of these aspects. Ken continued, “The process begins in the design stage where the customer and the landscaper determine the needs, wants and wishes of their dream home. An early discussion of the costs associated with the project begins and the possibility or need to stage the project over time is discussed.
As the design and costs are finalized, a schedule of construction is set. The landscaper works very closely with the homeowner and their builder, ordering material and watching construction progress, stepping into the schedule when necessary. It has been stated nationally that a professionally designed and maintained landscape can add approximately 15% to the value of the home with a 150% return on the original landscape investment.”
When choosing a landscaper to assist you in the process of designing a home, Ken suggested, “Don’t be afraid to interview a variety of landscapers to ensure a perfect fit since a close working relationship is essential to the success of the project while creating the vision of the homeowners. Have a budget and vision in mind so as not to waste the time of everyone involved. Wasted time leads to frustration, cost over-runs and a poor project. Have the potential landscaper provide you with a list of addresses that you might be able to simply drive by. Ask for references, copies of insurance certificates, and pictures of completed projects. Most of all have fun. When completed, a dream home should be a fantasy-like memory. Don’t let it become a nightmare.
“Ray’s Lawn & Home Care has been creating and maintaining beautiful landscapes in Lincoln and southeast Nebraska for 46 years. Our design work ranges from the very formal traditional landscape with formal hedges, symmetric design and native plants to the more trendy outdoor living spaces with water features, patios, fire pits and the newest plant material available. The personal touch of the designer working alongside the installation team insures a level of quality and perfection.”
Hardscaping and trees are two things that can really add to the beauty and functionality of your new home’s outdoor areas. Depending on where you build, the land may not have any mature trees (or any trees at all, for that matter). Trees not only add beauty, but they also offer shade, windblocks and are, of course, good for the environment. Work with a professional tree service to help you choose the perfect trees for your new landscape, how to plant them and how to care for them.
Hardscaping such as boulders, retaining walls and quality outdoor furniture are also excellent additions to your new home’s outdoor areas. They add beauty and visual interest and create a relaxing and welcoming environment for you and your family and guests to sit outdoors and enjoy the warmer months. Remember to incorporate hardscaping into your initial budget as you don’t want to find that, after the building process has been completed, you have nothing left in your budget and need to put cheap lawnchairs on your new gorgeous deck because that’s all you can afford. Your new home deserves high-quality outdoor accents, so visit with a professional such as those at Precast Products early on in the process to choose products that are high quality, long-lasting and will fit in with the final look of your home.
Financing
Planning for financing a home can be a daunting task for new homeowners. Mike Barrett, Vice President of Cornhusker Bank explained some of the financial options for homebuilders. He said, “Construction loans are available and range from six month to 12 months. With new construction, the builder will take out the construction financing and the buyer purchases it once complete. Otherwise, the owner of the property will purchase a lot and take out the financing and have a general contractor build the house. Once complete, the construction loan is refinanced into permanent financing. Interest rate locks on permanent financing can be taken out for as long as 12 months with upfront fees. Otherwise the borrower can wait until 60 days from completion and lock into their permanent financing with no extra upfront costs. We also offer a miniperm construction loan, which automatically converts to permanent financing once the house is complete.” Mike suggests that homeowners meet with a banker as early as possible in the home-building process to make sure the project works within the homeowners’ budget. He added, “With interest rates expected to remain low thru the end of the year now is a great opportunity to build a new home. Lot costs are reasonable and financing is available.”
Shawn Lang, AVP Lending at Liberty First Credit Union, also provided some insights. Shawn explained, “Both government and conventional financing exists for new homes. Qualifications and need will dictate the best option for each individual buyer. VA and Rural Development loans offer up to 100 percent financing for some borrowers with conventional buyers able to finance up to 95 percent of a new property.”
These loans do not differ from those for buying an existing home. Shawn said, “The permanent financing for a new or existing home will not vary by product. A first-time homebuyer may have an additional option with NIFA should they qualify.”
Shawn advised those who are looking to build a need a loan to get pre-approval first. He added, “Evaluate the loan options when considering the best- and worst-case scenarios. A good loan officer will help to not only evaluate ability but also provide information and education for all aspects of the process. For permanent financing there are lots of options including FHA / VA / USDA Rural Development/ NIFA / and Conventional loans. At Liberty First we work with the member to discover the right loan for their specific needs.
“It is best to get pre-approved for the loan prior to writing the builder contract to purchase the home. The builder/construction lender will need this ‘pre-approval’ letter when the initial contract is written to secure the construction financing.”
Regarding the difference between securing a loan with a bank and a credit union, Shawn said, “Credit Unions and banks both sell to the secondary market and both have competitive rates. Some differences are historically Credit Unions have lower upfront closing cost and lower mortgage insurance premiums. Currently the Credit Union’s mortgage insurance premiums are less than the Banks due to lower delinquency rates, which in turn allows the Credit Union to offer lower premiums to its members. Lower premiums mean lower payments for members.”
Shawn added, “Lenders are looking a maximum of 80 percent LTV which may be a challenge for the consumer/member who is trying to purchase a new construction home with FHA or VA for their permanent financing with lower minimum or no down payments. The additional risk on these construction loans are carried by the builder, taking under leveraged builders out of the market place. Rates and Value in the market continue to drive refinancing and new purchase business.”
Gary Carbaugh with Union Bank & Trust echoed both men’s statements about securing financing early on in the process. He also had this advice for those considering building a new home: “The best advice I can give is to take your time with this process. Too many people get in a hurry regarding purchasing a lot, choosing a builder and making decisions regarding the house you want to build. A lot of time should be given to all of these choices. This will be something that you will live with for a number of years and will have a great impact on your personal life. You’ll enjoy it more for years to come by giving it proper thought and planning.
New Home Inspections
When a new house is built, an inspector will need to check the home for its quality, safety and adherence to building regulations. Randy King of Kings Homes Inspections explained, “My role is to ensure that systems in the home work properly, are safe to use and are installed/of the quality commensurate with the home. I don’t look at an $80k house the same way I do an $800k house.
“The process of inspecting a home is a bit like working a picture puzzle. First, we turn over the pieces and find the border and get that put together. Then we find and assemble the major pictures, then fill in the gaps. I inspect the various systems in a house (electrical system, plumbing system, HVAC system, etc.) for function, safe installation, etc. and how they interconnect with the other systems throughout the house. I look at quality and installation commensurate with age and value of the property. Finding defective items and recommending repair is not the same as identifying ongoing maintenance items and making recommendations on those.
“I would give advice on designing the exterior with components that are minimal to no maintenance, long lasting materials and installations that are easily replaced as each component reaches the end of its designed life. I do new construction inspections, and I look for proper operation of all systems of a home. Frequently, things get overlooked. A dishwasher gets installed but someone forgets to hook up the power or water, or forgets the air gap in a drain line. An outlet or a recessed light gets installed, but doesn’t get wired up before sheet rock is finished. The gas was never turned on and air purged from the line to a fireplace. Sometimes builders forget to do a final inspection before they declare the house ‘completed’. That is where I can help on new construction.
“I have owned and operated King’s Inspections for more than 14 years and have inspected thousands of homes in Lincoln, Beatrice and Southeast Nebraska. I have a customer satisfaction rate of more than 95 percent. I have more than 30 years of experience in building maintenance with an emphasis in electrical. I offer competitive prices and a quick turn around. I also do Radon Measurement, being State and Federally licensed. I am a Certified Home Inspector with the International Association of Certified Home Inspectors (InterNACHI).”
Home Electronics
Lance Nelson of Sound & Security Innovations explained the process of planning and installing custom home electronics in your new dream home. He said, “We will meet with the homeowner or their builder to get an idea of their vision. We can review their blueprint or walk through the framed house and, using our experience, are able to provide suggestions or ideas on how we can materialize that vision. The design is then created and approved around that vision and their budget. Before the house is insulated and drywalled, we install the wiring and any other behind-the-scenes projects are completed. When the building process is further along and painting has been completed, we will install the finished products such as speakers, TVs and security. Once the project is finalized, we meet with the customers and demo how to use the system in a way that makes today’s electronics simple and easy to use.
“The ideal time to get in touch with Sound & Security Innovations would be when the framing stage is nearly finished. We prefer to meet at the house with the homeowner or their builder to come up with a collaberated design before the electrical wiring is completed. This ensures that the customer has time to make decisions and assists us in best reaching their goals. However, we are able to assist our customers at any time of their home-building process.”
Electronics are often cherries on top for a new home, and they have a hand in making the house your true dream home. Lance said, “It is becoming more popular for customers to connect to their WiFi network with their TVs or other devices, such as iPads or Blu-ray players, to stream audio and video to their home theater or home audio systems. We set up these devices with their network to allow them to stream Netflix or Pandora and show them how to use the new features available.
“Another trend being implemented is the clean and simplistic look of a flat screen television mounted on a wall with no equipment or wiring in sight. All equipment, such as cable boxes or Blu-ray players, are placed in a closed cabinet or closet out of sight with the same functionality as if they were still in the room. This look enhances the environment of a room by providing more free space and aesthetics that please the eye.”
Caring for Your New Home
It’s important to realize that after your home is finished, it doesn’t mean the work is done. Your new home is a beautiful showcase, but it will need to be maintained and that duty falls to you and your family! Here are a few things you need to consider:
Alarms The last thing you need is to have your new home broken into and vandalized or have items stolen. Having an alarm system is important, and something you should consider before your home is completed. However, if you have not done so previously, you should definitely meet with a professional in the alarm business when your home is completed to have a system installed. Working with a professional will ensure that not only will the correct system be chosen, but that it will also be installed properly and that you and your family will be taught to operate it effectively.
Cleaning Your new home is pristine with shining floors, gleaming windows and sparkling countertops. However, once your family moves in, the dogs start tracking in mud and the kids start drawing on the walls, your home is not going to stay in that new condition. Do you want to spend all of your free time cleaning? Probably not. Hiring a cleaning service early on is one of the best investments you can make in your new home. Whether you choose weekly, bi-weekly or monthly cleaning, knowing that you have a professional helping you keep your home looking its best takes a lot off your mind and helps you just enjoy your new home.
Housewarming Party You put a lot into your new home, now it’s time to show it off! Scheduling a housewarming party is a great way to show your family and friends your new place and celebrate with those who mean the most to you. Plan a party for soon after you get everything moved in so you can show off the ‘newness’ of your home to its best advantage.