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Better Than Bidding

Identifying the best pro to build your new home starts by clarifying your wants and needs.

Should you heed the conventional advice about getting price bids from three builders? Maybe, but once you understand the complexities and uncertainties that go into a bid, you will see why there may be a more effective approach.

The biggest concern with the three-bid method for deciding on a builder is that custom homes are by definition unique. The hundreds of processes and thousands of parts that go into a project make it tough to ensure that each bid uses the same assumptions.

If you already have a set of plans and want apples-to-apples bids, your plans need to be excruciatingly detailed, including written specifications for each faucet, floor surface and door knob. Specs like that are rare, to say the least. To create an accurate bid, the builder would need to ask a ton of questions to flesh out the details. Then each builder will unintentionally lead you in a different direction because their business procedures and preferred products will differ. And each builder will present the bid in a different format from the others, making them hard to compare.

What if your plans were drawn by an architect? That seldom changes anything. Architects are creators. They know how to turn your vision into a plan but usually leave the details and timetables to the person most qualified to implement it: the builder.

If you're determined to get three bids, consider hiring a professional builder to detail the plans and specs before sending them out to bid. This investment would help ensure that every bidder works from the same documents, allowing a more realistic comparison.

Even then, bidding has another drawback in that it reduces everything to cost. Yes, cost is crucial--everyone has a budget--but so is finding a builder with the right experience and personality for you and your project.

If you don't have a builder in mind, an excellent approach is to interview three builders, focusing on identifying a good fit, not on shopping for price. You are committing to a business relationship that could last for several months or longer, so the builder should be someone you like and trust and will enjoy working with. Follow your gut. Part of a good match is personal compatibility, and part is how the builder does business. Make sure the builder communicates effectively and answers your questions and that you are comfortable with their processes and way of doing business.

If you're working with an architect, then it's best to choose the builder before design work starts. With both professionals involved from the beginning, the builder can create budget estimates as the plans get drawn. This is the best way to avoid ending up with a design you love but can't afford.

When the builder and architect work as a team, you can start by walking the site with them. The architect can then develop a preliminary design and the builder can offer a ballpark price. If you don't like or can't afford their first drafts, ask for some value engineering. Once you're satisfied with the general approach and price range, they can work together to create detailed plans and specs. You will end up with a negotiated price you can live with and likely be happier than if you had gotten conventional bids.