The answer to this question is the same as it is for many, which is “that depends.”The amount of time it takes to build your home depends on the type of home you’re building and various other factors, like labor supply and weather.
According to the 2016 Survey of Construction from the Census Bureau, the average completion time of a single-family home is around 7.5 months.
It’s important to note that factors, such as the complexity of the project — the land on which the home is being built, the area where the home is being built and the intricacy of the home’s floor plan — will affect the building timeline. Custom homes can take longer to complete than production homes, while manufactured homes typically can be completed in a few months.
After speaking with the experts, we’ve identified the five most commonly cited factors influencing construction time: pre-construction and permits, environment, workers and supplies, changes and construction style. Although knowing what to expect may not speed up the process, it might just help you maintain your sanity.
Pre-Construction and Permits
Before a builder can start building your home, the home’s lot must be prepared. That means clearing trees, rocks and other items, rough grading and leveling for the foundation. Depending on how much work is involved — say there’s an unexpected issue while clearing the lot — there can be delays during pre-construction.
Getting proper approvals and permits can also cause delays. “Factors like approval on building permit and inspections process can vary between locations and can lengthen the time to a completed home,” says Matthew Gaudet-Walters, a sales representative for Walters Homes.
Depending on where the home will be, building times can be affected by region of the country — homes in the Middle Atlantic Region averages about 9.5 months from start to completion, while the Mountain Region construction averages around six months. Construction in metropolitan areas is usually quicker — seven months, compared to nine months in more rural areas.
“Although construction workers can do a lot of work in the rain, such as trenching or cutting down trees, there are some things that can be held up because of the rain,” says Kyle Alfriend, a Realtor with the Alfriend Group in Dublin, Ohio. “Primary weather factors — including the winter freeze — prohibits the pouring of concrete for the foundation and spring rains saturate the ground so much that holes cannot be dug for basements without walls caving in.”
Availability of Workers and Supplies
The summer months are generally the busiest time for home construction, so you might find your new home’s construction delayed while waiting for the necessary labor to be available.
“One element in our construction time calculations is the available labor pool and how which specialists are needed among the subcontractors, like the electricians, plumbers and framers that the design calls for,” says Peter Di Natale, president of Peter Di Natale & Associates, a New York-based homebuilder and contractor.
Changing the Plan
Change orders will usually extend the build time, especially if they occur in the latter part of the process.
Di Natale also notes that when buyers wait until the last minute to choose their finishes, this can cause delays. “For example, cabinets usually take six to eight weeks to order and one to two weeks to install, so selecting cabinets when it is time to install them will cost you two months or more.”
To limit the amount of time lost to decision delays, you should maintain open communication with your builder. After all, throughout the construction process, there will be many decisions that you must make along the way.
The style of your home will also influence construction time. Custom-built homes average 10 to 16 months, while personalized production plans average four to six months. Because the floor plans used by production builders have been built many times before, there are generally fewer delays. “Choosing a standard floor plan will quicken the building process, because it eliminates any variations that the builder will need to work out,” says Gaudet-Walters.
Ask at the right questions about New neighborhood developments:
Contact Kelly Kassab for Metro-west Massachusetts Real Estate development advice. She is on the Boston Board of Realtors with twenty years construction planning and development experience. 617-835-5533
Date: 12 September 2017
The Immediate and Long-Term Impacts of Hurricanes Harvey and Irma on the Construction Industry
Although the full extent of damage from Hurricanes Harvey and Irma has not been fully realized or assessed, the impact on construction costs will become swiftly apparent. We will attempt to identify the greater economic and logistic issues, as well as key specific short-term, long-term, and regional construction impacts.
REGIONAL AND NATIONAL IMPLICATIONS
The severe damage and flooding to the Texas Gulf Coast, Florida, Georgia, South Carolina, and the remaining Southeastern United States has national implications. As a result of Hurricane Harvey, more than one million people have been displaced. As many as 400,000 homes and 700,000 vehicles were significantly damaged, and more than 300 miles of coastline in South Texas have been affected. Texas accounts for half of the country's petroleum and gas exports, and 20% of the country’s chemical exports. The Texas Gulf Coast is home to roughly 30% of the country’s refining capacity as well. Major production centers for oil, gasoline, natural gas, chemicals, and manufactured materials have sustained long-term damage. Property damage estimates range as high as $190 billion, which, if true, would make Harvey the most expensive natural disaster in U.S. history.
Hurricane Irma is currently working its way through the heart of the Southeast. It has ravaged the Caribbean, created mandatory evacuation orders for more than six million people in Florida, and knocked out power for more than 10 million in Florida and one million in Georgia (to date). It may take weeks or months to get power back to these regions. Torrential bands of rain and storm surges are creating flood conditions throughout Florida, Georgia, and South Carolina, and the extent of damage has yet to be fully fleshed out. Unlike the damage caused by Harvey in Texas and Louisiana, most of which was related to flooding, much of the damage caused by Irma has been from extreme winds that damaged roofs, windows, and power lines. Evacuations from Irma were much more extensive. Early property damage estimates for Irma put the cost at $100 billion.
MAJOR FACTORS IMPACTING THE ECONOMY
Many factors have combined to create short-term and long-term volatility in the economy. These factors include:
In terms of demand, the items most impacted by the repair and rebuild effort will be sheathing and roofing products, as the effort to protect partially damaged structures begins. The remaining demand-related impacts will trail by a period of 12 to 18 months, following the timeline of the flood recovery efforts.
Historically, rebuild projects from natural disasters have been slow to materialize. Depending on how many evacuees return to their original homes, the home building industry could feel definite pressure to build new housing and infrastructure throughout the South and Southeast, not just in Florida, Georgia, and the Texas Gulf Coast. This will take a number of years to accomplish.
SPECIFIC TRADE AND MATERIAL IMPACTS TO THE CONSTRUCTION INDUSTRY
Fuel and energy — The cost of energy affects every aspect of construction, from production and shipping to installation and labor mobility. The volatility in the price of oil and natural gas will have immediate ramifications. The Texas Gulf Coast represents roughly 20% of U.S. oil production capacity and 30% of the nation’s refining capacity. Per the Department of Energy, at least five refineries in the Gulf Coast are operating at reduced rates, which accounts for eight percent of U.S. refining capacity. Six refineries are in the process of restarting, accounting for 12 percent of U.S. refining capacity. Five refineries remain shut down, accounting for six percent of the country’s refining capacity. The restarting process can take several days or weeks, depending on the extent of the damage. The Colonial Pipeline continues to experience a delivery delay of up to a week to Mid-Atlantic states. States along the East Coast can expect gas prices to remain volatile because of already tight supply levels stemming from Harvey, combined with the yet-to-be-known impact of Hurricane Irma.
Oil costs have remained relatively flat. West Texas Intermediate is currently at $48.58/barrel, $0.51(-1%) lower than one month ago. Positive news about oil production capacity, as well as a world-wide glut, has helped contain the price volatility for crude oil. However, refining and pipeline constraints has put pressure on gasoline prices. Diesel prices have surged $.20/ga from one month ago nationally, stabilizing at $2.72/ga. The increased cost of transportation and shipping may be passed on to consumers in the form of delivery surcharges. Subcontractors in past disasters have added surcharges ranging from 1% to 4% on products such as steel, lumber, concrete, roofing materials, and piping.
Labor availability — Rebuilds following natural disasters have been historically slow to GRAND OAKS, SAN JOSE
materialize. The nature of the Harvey and Irma disasters will not allow the complete rebuilding effort to fully mobilize for at least eight to twelve months, if not longer. The initial effort to bring power and access to regions of the Southeast, and to clean up the worst water and wind damage, will delay full demand on regional building labor. The Texas Gulf Coast has a construction labor pool of 210,000 workers, many of whom have been displaced by the hurricane. The immediate workforce required for clean-up and repair will absorb much of this displaced labor. The rebuilding of properties and infrastructure will create a demand on the highly mobile regional construction workforce. No one is certain when, and at what pace, this work will materialize. Depending on the timing and level of funding provided by the insurers, private entities, and the federal government, the ramp-up could peak roughly one to two years from now. A more deliberate rebuild could take a decade or more. According to Engineering News-Record (ENR) and Global Insight, Harvey will further tighten an already tight labor market in Houston, which had a 4.9% unemployment rate in July. The initial push will come in trades such as flooring and drywall, followed by demand for higher-skilled workers such as electricians and ironworkers. Expect strong boosts in overtime. However, higher wages may take several years to unfold. Based on studies of Hurricane Katrina, two years passed before a 10% increase in wages for carpenters in the storm area was measured. The damage and impact from Hurricane Irma is still being assessed, but we expect a similar sequence of events.
Dimensional Lumber and Sheathing — Prior to the hurricanes, lumber and sheathing prices were steadily climbing because of strong demand and countervailing duties (as much as 20%) on imported Canadian lumber. Canadian producers were getting a temporary reprieve at the end of August, pending a decision from the U.S. Department of Commerce, which is expected to be finalized by November 14th. The market was anticipating a decline in lumber prices nationally; however, the impact of the hurricanes will most likely nullify the decline. Since the hurricane, panic buying and speculation has driven up costs for dimensional lumber, plywood, and oriented strand board. East Texas, Louisiana, and Mississippi generate most of the yellow pine used in this country. Fortunately, most of this region was spared by Harvey. However, we may soon see as much as a 50% price increase for sheathing in the regions affected, due to panic buying and immediate demand to secure and weather-protect existing facilities. Similar price spikes occurred following Hurricanes Katrina and Rita in 2005.
Roofing materials — Roofing, visqueen, and sheathing are the three items that are in highest demand following natural disasters, as facilities are closed in to protect from future weather damage. Immediate demand will have great impacts on the price for roofing, and the effects will be regional in nature. In addition, many roofing materials are either petroleum- or cement- based, and will be price-volatile due to the cost instability of the raw material components. Per Global Insight, as much as 90% of U.S. production capacity for resins used in other plastic products is either confirmed offline or has the potential to be impacted because of Harvey.
Structural and Reinforcing Steel — The port of Houston is the largest importer of steel products into the country. Per ENR and IHS-Markit, the combination of a disruption of imports, lost inventory, and increased demand from rebuilding could check steel prices, which were weakening before the hurricanes.
On a positive note, the probability of a tariff on imported steel has greatly subsided. The U.S. Department of Commerce had been investigating under section 232 of the Trade Expansion Act of 1962 to determine whether U.S. imports of steel and aluminum are a perceived threat to national security. Latest research by IHS-Markit believes this tariff will not go through. Expect steel prices to remain stable.
PVC products — One of the largest impacts may be to PVC products. As of yesterday, 25% of the U.S. production capacity of PVC was offline, and another 57% has been potentially impacted. Although production is expected to ramp up quickly, impacts to production and distribution will put a crimp in availability nationwide. Upward price pressure will come from additional demand due to the need for infrastructure repair. Compounding this issue is the fact that FEMA-installed temporary housing has historically had high PVC component content. Expect a double-digit price increase for these items in the next three to six months.
We will continue to monitor the previously identified factors for any changes. We believe the disruption to supply and logistics will be the primary immediate cost driver, with the demand aspect of this event ramping up slowly in the next 12 to 18 months. The impact to each project must be looked at individually based on the type of construction, as well as the timing and location. This story is evolving on a daily basis. The impacts can be summarized by the following chart:
SHORT-TERM AND LONG-TERM COST PRESSURE IMPACTS OF HURRICANES HARVEY AND IRMA:
If you have any questions regarding this report, please call Bill Rodgers at 916-276-4201, or email firstname.lastname@example.org.
Prepared by Cumming Page 4
Buying new construction is often a long, drawn out and stressful process for new buyers. Select a buying agent with proven experience and professional knowledge in new construction. Over the past decade there have been a lot of changes in building materials and a flood of products that vary on quality and longevity.
Selecting and Working with a Builder
A good builder will have strong industry connections with solid, long standing relationships. Allowances are cosmetic, but the bones of the home matters with respect to upholding value and efficiency. A new construction buyer agent should be able to handle due diligence and be qualified to ask the right questions about building materials and practices.
Hire A Buyer’s Agent
Besides conducting a town-wide survey, one of the smartest things you can do is to hire an independent buyer’s real estate agent, preferably one with lots of experience in new construction. While buyers today can do a lot of their own due diligence and research on prospective builders, an experienced Realtor knows all the local builders in town and knows who builds castles and who builds shanty-shacks. A good buying agent will guide you through the big picture and not leave it up to the listing agent or builder based on their agenda.
A buyer’s agent will also provide a much-needed buffer between the builder’s sales agents and listing agent, many of whom unfortunately engage in high-pressure sales tactics and fast-talking. Many buyers don’t realize that if they visit a new construction site without a buyer agent, they run the risk of having to work directly with the builder’s agent whose job is to work in the best interest of the builder. A buyer’s agent will watch out for the buyer’s interests.
Amenities, Allowances & Upgrades
The builder should provide you with a detailed specification sheet with a standard panel of features and options for flooring, appliances, paint, trims, HVAC, and lighting, etc. These will be built into the purchase price. Most builders also have allowances for things like additional recessed lighting, upgraded stainless steel appliances, decking, and fancy hardwood floors. Typically specification lists lack a lot of detail about the home on models, trim work and small details that really add up when you begin shopping for hardware or lighting.
It’s imperative that all allowances be spelled out in writing and attached to the purchase contract documents. Change orders are common during the construction process, and these too should be defined in writing. They will be added to the purchase price or paid in advance.
New construction purchases in Massachusetts follow the same basic legal process as already-owned homes. The parties first execute an Offer to Purchase which spells out the very basics of the transaction: down payment and purchase price, closing date, and financing contingency. After the offer is signed, the parties will sign the Purchase and Sale Agreement. As a buyer, the detailed specifications, amenities and agreed upon allowances must be incorporated into the contract, along with the floor and elevation plans, if any.
The proposed purchase and sale agreement will likely track the so-called “standard form,” but the builder will typically add a detailed rider, which is completely different than the usual seller rider seen in existing home contracts. The builder rider will have provisions dealing with how change orders are handled, that the builder is not responsible for cracking due to climatic changes, and may attempt to hold the buyer’s feet to the fire with respect to getting his financing in place. A lot of builders will try to limit the availability of holdbacks at closing. I would push back on this important item of leverage for buyers. Some of the large national builders such as Pulte will even claim that their contracts are “non-negotiable.” This is nonsense. Everything is negotiable these days.
Hiring an experienced real estate attorney will tip the balance back to the buyer, and the attorney should have a comprehensive buyer rider in place to protect you in case there are title issues or you suddenly lose your financing. Because there are often delays with new construction, one of the most important rider provisions for buyers is a clause which will give buyer’s protection in case they lose their rate lock due to a delay.
Most new construction buyers in Massachusetts will take out a conventional mortgage loan, with the builder responsible for financing the actual construction through his own construction loan. Some builders, especially national ones, will have their own mortgage lending for their projects, but they often don’t offer the best rates and terms. Sometimes, buyers will finance the construction through a construction loan under which the borrower pays interest only through the construction process, and is then converted to a conventional mortgage once the home is completed. I would counsel buyers to avoid taking on the financial responsibility of a construction loan. As with all lending, shop around and compare apples to apples.
Inspections & Warranties
For new construction, home inspections must necessarily be delayed from the usual timeframe (7-10 days after accepted offer) where the home is not yet completed, and buyers should absolutely reserve their right to perform the usual comprehensive home inspection prior to closing. (If the home is already done, get in there with the home inspector). During the construction phase, builders don’t want buyers on the construction site, for obvious liability (and annoyance) reasons, so resist the urge to buy your own hard-hat and hang out with the construction guys.
Contrary to popular belief, Massachusetts law does not require a 1-year builder’s written warranty for new construction, however, most builders will provide one, albeit littered with exceptions to coverage. Fairly recent Massachusetts case law does impose a 3 year “implied warranty of habitability” for certain undiscovered construction defects. Again, selecting a reputable builder in the first place is “the ounce of prevention worth the pound of cure.”
Punch-Lists and Closing
There will inevitably be unfinished items right up to the closing. I’ve rarely seen a new construction transaction without a punch-list at closing. Some unfinished items will be serious enough to warrant an escrow holdback at closing (remember, I had said push back on this during P&S negotiations). Some lenders, however, will not allow a holdback, so the parties will have to negotiate and be creative at closing to ensure that all unfinished work is completed within a reasonable time after closing. If the home is part of a larger project/subdivision, this is usually not an issue. However, for “one-off” single site projects, getting the builder to come back and finish punch-list items after closing can be like pulling teeth. Again, having a real estate lawyer on your side and in control of the funds will give you leverage here.
Once papers are passed, the closing attorney will lastly ensure that there are no outstanding subcontractor liens on the property, which is one of most common hiccup at closings. For this reason and many others, it is imperative that buyers obtain their own owner’s title insurance policy, to ensure that title is clear, marketable and free of undiscovered defects and liens.
Please contact me for a complimentary consultation. As a seasoned real estate and architectural consultant, I can educate you on the process.
Kelly Kassab 617-835-5533
Beige and brown are back!! If you never got around to embracing the grey trend, well guess what? Your back in!
Tribal patterns and color palettes of black, white, caramel combined with organics!
Orange and red are making a swift comeback!
Check out warm neutrals, gold, browns, and organics.
Everybody wants calm. Many consumers are not feeling attracted to bright, cool colors mainly because that doesn’t reflect their mood. They are craving a nest that brings understanding, friendliness and closeness. I wouldn’t be surprised to see this trend manifests fully by fall market.
New Home Construction has obvious appeal with the ability to personalize floor plans, finishes and features. Today homes are more energy efficiency with new building materials making home tighter and yet permeable for balanced heating, cooling and moisture management.
As an architectural consultant and real estate consultant, I've overseen new building construction from commercial park buildings to residential homes. It can be frustrating for any stakeholder to invest in a new property that does not meet their expectations. My name is Kelly Kassab and I grew up in the building industry with my father as building inspiration. After college I entered into the world of commercial real-estate with respect to mergers, acquisitions and construction management. Over the years I've learned a fair amount about architectural planning and building practices.
FAB FIVE CONSTRUCTION QUESTIONS:
1. Ask questions to learn more about the builder's construction process and practices!
Many times builders advertise a home with basic finishes and low allowances which result in price creep. Obtain land plans with detailed specifications and a break down of allowances in writing. Areas that people do not consider to discuss are building envelop materials, foundation drainage, mechanical, electrical, plumbing, energy efficiency testing and insulation r-values.
Builders know cost saving differences and so should you. Quality craftsmanship depends on material differences and performance grades. Cost cutting considerations might be vinyl siding, no sprinkler system, reduced millwork package, carpet or reengineered hardwoods and low allowances.
2. Who will oversees the construction once the building starts?
A good builder will have solid relationships with trade professionals. Analyze the team and their resources for support throughout the process. Understand your project support system once you begin to building through final walk through and occupancy.
3. What are the main features of the homes and consider the extras?
Every home builder has a standard specification list of features, finishes and allowances. Material differences include the type of siding or anything to do with the building envelope. Review interior millwork, flooring, counters, cabinets and fixture budget. Allowances are dollar values that will impact selections on for interior finishes and exterior landscape.
4. How financially stable is the builder?
A stable developer will be well established to survive a dip in the market without substantial financial debt or investors looking for a profitable return. How long have they been in business? Are they an independent builder or do they require partnerships? Do they own their own equipment? Can you get testimonial from trade contractors? Stable builders will have a long standing network of subcontractors, equipment and resources.
5. How long will my home take to build?
Two key areas to determine a construction schedule: pouring the foundation and framing to close up the building envelop. In order to pour a foundation, builders require approval from the town with a permitted plan along with secure road bond and power to the street. A builder should have a good idea of how long it will take to build your home based on when the foundation begins, time of year and caliber of the home. As the buyer, you will need to be somewhat flexible since weather can play a factor in development, however you should get an estimate.
Ask the right questions. Not all agents in new construction understand building beyond cosmetic finishes. It can be hard to envision land terrain, building position, land elevations, retainment walls or sloping topography. Qualified agents will have a background in the industry similar to real estate licensure, but with additional qualifications in architectural design, construction management or construction document technology to be a resource on building materials, u-values, r-factors and energy efficiency.
Please do not hesitate to reach out to me directly for development questions.