Considering alternatives

After the disappointing news from the delivery assessment the other day we have been exploring other possible options for building a house on this land.  Of course if Blu Homes is going to have difficulty delivering it's more than certain that the other prefab companies will have the same or an even harder time considering the others require wider roads and have similar weight constraints.  This leaves us with building a conventional or "stick-built" home on-site.

We are starting to talk with some architects and builders in West Marin to figure out how costs might vary with a custom home.  So far we have received building estimates from $300-$350 per square foot.  This figure is somewhat comparable to what we spent when we built our addition in San Francisco in 2006.  There are a few downsides to building a stick-built home:

The project will take longer

Building a home on site requires construction to happen in succession.  The foundation and other site work must be complete before the home framing can begin.  The prefab house manufacturer can save time by sequencing the site work and module building in parallel – largely independent from one another.

Project timeline (from Blu Homes' information booklet)

Construction loans will be carried longer

Construction loans are more risky for lenders and so their interest rates are higher.  While building conventionally might take months and be delayed by bad weather, prefab construction takes weeks and can be installed and ready for occupation in days.  This means that a higher-interest construction loan can be more quickly converted into a lower-interest conventional mortgage, thus saving money.

Costs are less predictable  

Assuming that you let Blu handle the site work, by the end of the detailed design phase the costs for a Blu home are fixed.  This is a pretty sizable advantage over working with a traditional builder where costs seems to shift around and there are almost always budget overruns.

Impact to the neighborhood is greater

When building on-site a construction crew will be traveling to and from the job site 5 days a week for however many months construction is occurring. This can add up to quite a neighborhood disturbance – not the way you'd typically like to introduce yourselves to your new neighbors, am I right?

The fewer days you are making construction noise and blocking road access the better, and installing a prefab home generally minimizes this disruption.




The main advantage of stick-built

It should go without saying that there are also advantages with a custom stick-built home.  First off, it's customized!  You are not bound by a menu of options and materials.  You pick the architect and you inform the design from beginning to end.  I should note that Blu homes can also be highly customized, but you lose much of the efficiency of prefabrication and the cost goes way up.

Custom home designed by Bercy Chen Studio

Today we are meeting with Blu in order to do a preliminary financial breakdown and discuss how lender financing works with Blu.  I'll post updates on what we learn from that meeting.