Today thousands of new home owners are bypassing traditional general contractor agreements and choosing to be owner builders. With the advent of building technologies (such as Castle Gate Homes panelized home packages) and the acceptance of the practice by lending institutions, owner builder projects are sprouting up all over the United States.

But what's the difference between an owner builder project versus a traditional general contractor project?

Let's first talk about general contractors:
Under the traditional general contractor (GC) relationship, the general contractor is responsible for everything required to build a house to the specifications outlined in a contract. This includes obtaining permits, managing all phases of construction, paying subcontractors, purchasing appropriate insurances and lets not forget working in change orders. For this effort, the home buyer agrees to give the GC a sum of money. Once completed the general contractor hands the keys to the new homeowner. They didn't get their hands dirty and hopefully everything went off without a hitch, everyone walks away happy.

What did they exchange for not getting their hands dirty in this traditional relationship? A completely finished NEW home purchased at or near the fair market value (i.e.- the homeowner contracted the home to be built for $200,000 and they could sell the home tomorrow for the same price).  It's common knowledge that many general contractors typically make 15% to 20% profit on projects. While this sounds expensive general contractors are worth every penny for those not up to the challenge of being an owner builder. One thing is for certain, not everyone is cut out to be an owner builder, even people who are experienced in the building trades.

Cue the owner builder:
In essence the owner builder is really a general contractor. They are responsible for everything the general contractor is traditionally responsible for; permits, planning, accepting bids, scheduling, managing subcontractors, paying vendors and labor…. you get the picture, everything. The success of the project rest squarely on their shoulders. Successful owner builders are first and foremost good managers and know how to offset these responsibilities to the appropriate team members.

Owner builders must determine their role early in the planning process as to where they are going to contribute to the project. They must be realistic about their abilities and with their available time. Some owner builders find out the hard way that they should have hired a professional general contractor to build their home. Lack of time, organization, planning, experience in managing people and money (notice that construction knowledge is NOT listed!) can send an owner builder project down the tubes fast. It's important to understand that just because someone chooses to be an owner builder does NOT mean that you are completely on your own.  When you purchase a Castle Gate Home we will guide and assist you through every stage of the building process as needed.  As an owner builder using our Builder Assisted program, you are the GC for the project (building your home) and Castle Gate Homes will serve as your building consultant and Site Supervisor for your bank or construction financing lender.

How much involvement?
Owner builder projects can be complete ground up construction with no outside help, hybrid owner builder / general contractor relationships, or complete subcontracting of the project with the home owner being the main overseer. In the end, the more involved the owner builder is the more money they will save, typically. Remember poor workmanship and planning can be costly. Site supervisors can be helpful and are usually REQUIRED if you are going to finance the construction.

Most banks will require a Site Supervisor, and with good reason. Banks want to know the owner builder has someone available to help in the planning and organization of the project. They also want to make sure the owner builder has someone to pull them out of a jam when the going gets tough. Having an experienced professional general contractor (Castle Gate Homes) as your Site Supervisor can be your best asset.

Know the rules...
The tasks of an owner builder are not to be taken lightly. By signing a building permit application an owner builder assumes full responsibility for all phases of the project and its integrity. Before beginning the journey of becoming an owner builder check local and state regulations. Special restrictions may apply to owner builders. Follow this link to find out more about your state's requirments Contractor's License Reference Site.