Building without GC Savings ?

[twolabs]

Making plans to build and wanted to know how much the savings would be? I know every situation is different just curious what I could possibly save by being my own GC. Not worried about coordinating with different subs.
Or keeping an eye on them.

 

[turbowoodworker]

Wide range, lots of variables.
Twelve to 18%, excluding land cost

Not going to show my bias much except to say that permits, municipalities, HOA, subs, contracts, etc etc etc. That is worth different amounts to different people. Oh yah, I wasn't going to show my bias.

 

[turbowoodworker]

BTW, might help to know what it is you are building. Shed, shop, detached, heated, plumbed, whole house, estate, budget, overall sq ft, finishes, all are a part of a more accurate answer. Profit margin for GC has to balance out their hassle factor.

 

[kd3pc]

15-25% depending on how good they are and up to date their contacts are.

Value to the homeowner - depends on what you can and will do. Correctly.

 

[CrashmanS]

When I built my house, I was the gc. But I work at a vocational center with a background in some construction projects. Although I don't teach construction, I had access to the trades via the instructors that do teach in these fields. I was also off during summer vacation and lived on site during construction (house trailer), I was always on site. I saved probably 50% because I did what I could and helped with the stuff the contractors didn't want to do (carrying blocks to cleanup to building my own decks and trenching for utilities). So my answer would be, how handy are you and how much time and effort will be put into the project by you. This will have a direct impact on cost savings across the entire project.

Sent from my SM-N920P using Tapatalk

 

[Dirtydan69]

The GC typically works with proven subs. That can be worth a good buck. It can take quite a bit of effort for the person who is not in the trades to find the right ones. Often it is the luck of the draw. That being said you can save 15% or more GCing it yourself. You WILL earn it.

 

[Catadj78]

I'd say if you don't at least know someone well that could assist you or know a lot about construction to just go with a GC

 

[kaiser715]

The same sub that gives the contractor (where he'll get repeat business) one price, will likely give you another (higher) price. The contractor is going to get a better deal at the local supply houses, builders supply, etc.

So...you'll save 10-20 percent on the GC fee, but you may pay 5-10-15 percent more to subs, suppliers, etc.

Makes the savings margin thinner than you would think.

 

[GTO]

I would say GC it yourself if you know your subs.

 

[brownbagg]

saving is not in gc but in labor, pay a person 100 dollar a day to build, roughly there be ten guy on site per day. $1000 a day. takes 45 days to build that $45,000 in labor.

it took me 18 months build my house, save over $100,000 in labor, pay cash so no fiance, another $100,000 in 30 years.

my house ten year ago cost $49,000 in materials. that it, pay for the day i moved in. worth $200,000 today

 

[Radix2]

In today's market where all the good subs seem to be booked solid, I am sceptical that the savings will be large. And I think it is an absolute certainty that keeping to a schedule will be difficult...if time is money, there is another loss.

If you were going to do it, get yourself set up as a builder so that you can represent yourself that way.

 

[ishiboo]

The same sub that gives the contractor (where he'll get repeat business) one price, will likely give you another (higher) price. The contractor is going to get a better deal at the local supply houses, builders supply, etc.

So...you'll save 10-20 percent on the GC fee, but you may pay 5-10-15 percent more to subs, suppliers, etc.

Makes the savings margin thinner than you would think.

If you have a bit of time and you can keep an eye on, I've had very good luck hiring professionals from Craigslist who are simply laid off, between jobs, etc. Also some bad luck, but I see pretty quick if they're not doing things correctly and they're out if they don't make the change.

I usually have an idea of how long something will take, so I pay hourly instead of by the job. If it takes two guys to frame something it's not a big deal.

This requires a lot of attention to detail. But I check references/what people did, work that they've done, etc. One of my best guys was too young to officially retire, but had some pancreas problems that required occasional flexibility... for $10/hr he worked his *** off and did the best work I've seen. Unfortunately we became good friends and he passed away a few years back.

 

[LXCam]

Spent my entire life in construction. Everything from basic structures to custom swimming pools to running 100+ million dollar structures. 40 yrs from digging ditches and hammering nails to being the first guy in line to sign the check.

My advice is unless you have a thorough knowledge of all the sub trades you need to hire and the ability to self perform some major task of whatever it is you want to build you won't save a dime. Oh it might look like you will when crunching the numbers but having a single entity being responsible for the final product as well as the liabilities along the way will normally save you money in the end.

But if you do have some of those abilities as well as buddies that are good contractors or knowledgeable tradesmen you can save 10-20%. The key component here is your ability to schedule the job. The next big item you have in your back pocket is just that, your wallet. Cash flow goes a long ways when dealing with subs, you keep the cash flowing and you will find guys willing to drop their prices. One of the major drawbacks to being a sub is being the bank if you're dealing with a GC sometimes. As a sub if you're having to finance the job for 60-90 days there is a surcharge that gets calculated into the final number. With my contracting business I looked at 30 days being the same as cash. If I knew I'd be held out an additional 2-4 months on payment I didn't give any deals. And back when I was nothing more than a one man show with maybe a couple guys and you paid me at the end of each week, ya got the deal of a lifetime

Good luck bud.

 

[bjcouche]

I was my GC for my shop build and I like making sure things are done properly. However one drawback to being your GC is finding subs. I don't mean finding a sub, I mean finding one who will return your call, let alone show up for an estimate. The large GC's have better relationships with the trades and keep them busy so they have better luck getting them to show up for a smaller job.
Each area of the country is different in this regard as well and also varies by time of year...

Brian

 

[Thumper68]

IME the most savings on any job is in Labor, if you can do things yourself acting as GC, you can save quite a bit.

One big thing is daily clean up, at the end of each working day on one of my projects I or my kids went around doing all the clean up, wood scraps, bits of wire etc...

There is no way I am willing to pay someone $20+ and hour to sweep.

As a GC for one job the others are correct in that finding the best subs is an issue. however if you have the time then it can be done. I used to have a great electrician who did side work on the weekends, so I would get him in there when he was available, he also had no issue with me putting in all the boxes, drilling holes, pulling wire and he would do all the terminations. over the course of a job this saved me thousands.

This worked for me because I was on site most days anyway to solve issues with other subs.

Another spot I saved $$ was drywall, I would hang it all and just pay the tapers to do the finish work.

One last thing is that you can save a lot by sourcing materials yourself, where a GC will order all materials from one place you can use your time to find the best prices, of course to do this you have to know what you need and when you will need it. Wire is a good example, knowing that you will need say 2000' of 12-2 you can watch sales and pick it up in advance and have it ready for the elec.

I have a friend who built his entire home from materials from RR auctions, yes he had to buy entire car loads of damaged wood, windows, etc. but he paid pennies on the dollar for them and had a nice big pole barn to store them in.

In the end after selling the extras he built his 3000+sf home for under $25k

 

[Milzo]

I've GC'd my last 3 houses. I made right about $100,000 on each house & roll the equity into my newest house. I have a construction management degree and worked for a top 3 national homebuilder for 15 years. If you have little experience assembling a budget, creating a schedule and hiring contractors I would recommend you get at GC. It will be very difficult to control subs timelessness quality and cost if you don't know them. Also you most likely will pay more than market price for material and labor than a GC would. For example brick labor in Cleveland is about $1/brick or more. I paid $.75/brick because I had given the contractor hundreds of jobs over the last 15 years. I got my concrete floors for $2.25/sf when the normal market price is $4.

I opened an LLC last year to build my latest house and do projects for friends and family. At the moment all of my time is consumed trying to finish my new house. After my house is done I am going to do some projects for people. One person in particular is interested in hiring me as a consultant so he can GC his own home. If you can find someone in your area that offers the same service that might be the best of both worlds.

 

[Streetbu]

My wife and I are thinking of doing the same thing. Our situation is slightly different though. We live in a small town and know all the subs personally. As in, they owe us favors. We helped build our friends house two years ago, from the poured foundation, to the exposed timbers in the living room. He subbed out the electric and plumbing, but did the rest himself with many friends help. We're going to do the same thing, but with a much smaller house since it's just my wife and I after our son graduates in June... We anticipate saving almost 50% because of this but that is definitely NOT the norm.

 

[klassenl]

I am in the trades. I know all of the trades and I still had a contractor/GC help me with things. It made things move forward much quicker.

 

[twolabs]

Thanks for all the insight. Lots of good info. My thinking is just because GC gets better price from subs doesn't mean those prices are reflected in the price to the homeowner just means GC is making more money. I won't be financing and am not on a strict time table and have contacts for most subs. I think it will be a fun project I was just was looking to see what the savings would be.

 

[Smoker]

I would say at least 25%, maybe more. As you correctly stated, the GC is going to take a cut of the $ and mark up the subs prices so their "better price" doesn't pass through. Same goes for materials. Everything gets marked up. I bought all my material direct and hired the subs myself. Worked out great.

 

[theoldwizard1]

My daughter's father-in-law has been a been a very handy guy. He did major renovation on a 100+ year old farmhouse. Excellent quality.

When they retired he bought a trailer on a small lake with enough property to build a nice house. The wife retired, so he started working on plans. Once the plans were finalized (I am sure they were approved by an architect), he surprisingly hired a GC. His logic was, the guy knew all of the subs, so it would help a lot.

Just the opposite. The GC never would put himself between the subs and the owner. (Remember, the owner was retired and lived next door.) It was not a smooth build. Last I heard the basement floor had to be replaced plus hundreds of other small items.

It might have taken twice as long to find and hire the subs himself, but it would be done to his satisfaction, with one less hand in his pocket.