New Homes & Rebuilds in Ocean, Monmouth & Atlantic County

Dream Homes Blog – 4-9-13 – Costs, Perceived Cost, and Total Cost – 5 Key Facts about Saving Money with Consultants

Dream Homes Blog 4-9-13 – Rebuilding after Sandy

          Costs, Perceived Cost, and Total Cost – 5 Key Facts about Saving Money with Consultants


Hello NJ –

Hope this post finds you well and enjoying the beautiful weather. That’s why we love NJ.

Today I will write about something near and dear to everyone’s heart – money and the saving of same. First a note from our sponsors… and then 5 Key Facts about Dealing with Consultants.

FREE Rebuilding after Sandy Seminar: Mark your calendar:Thursday 4/25/13 at 2:30 at Kate & Ally’s Restaurant in Forked River. We will be hosting an architect (Scott Lepley), realtor (Tracey Giery), attorney (Sandra Guage), mortgage professional (Steve Brasslett, Ivy First Mortgage) and myself (Vince Simonelli, Dream Homes Ltd., builder). We’re trying to get Matt Bonaventura from FEMA also, but he is not confirmed. It’ll be an open forum for discussion so come get your specific questions answered – bring your surveys and flood elevation certificates. Seating is limited and refreshments will be served. Call 732 300 5619 to reserve your space. Click here for more info.

Ok, back to our regularly scheduled programming…J


Here are 5 Key Facts about Rebuilding using consultants. We’re all conscious of budgets in our rebuilding pursuits, and rightly so. Today I want to introduce and discuss the concept of total costs, which is not something we often consider.  I’m not specifically referring to homeowners here either – builders and contractors are prone to the same shortsighted approach to costs as anyone else.

When I as a builder, hire Plumber 1 to plumb a house and his price is less than Plumber 2, but he doesn’t include the water and sewer connections to the house, he doesn’t have email and it’s a challenge communicating with him for service or inspection calls, he doesn’t show up on time or complete the job in a timely manner (or at all), it actually costs me much more to deal with him. I haven’t considered total cost. There are dozens of excellent examples of this in our every day life.

My grandmother used to say, “Penny wise and pound foolish.”

When a homeowner decides to general contract their own home renovation, it reminds me of the old adage, “A person who represents himself has a fool for a client.” Be warned – do not try this at home.  It is complicated, will cost you more to do yourself, and you will risk going slightly insane.

Fact 1: When a homeowner thinks they will save money being their own general contractor, unless they are really experienced, they will often wind up spending 10%-20% more in total costs on their renovation than if they hired a consultant to navigate and steer the ship for them. When you retain an attorney, an accountant, an engineer, a real estate or mortgage broker, or a builder or general contractor, they save you money. When you hire a building consultant to lift/move/reorient your home, whether it be architect, attorney,  engineer or general contractor, they will easily save you in excess of the cost of their fees, and allow you to sleep at night knowing someone competent is overseeing the process.

Fact 2: Most subcontractors do not wish to deal directly with homeowners. No offense, gentle readers, but client contact and discourse is an art, and requires time and a semblance of personal skills. One must be able to communicate effectively. Some (most) contractors are lacking in social graces and efficient communication skills. This makes your life miserable. Remember: you have to live with the person you choose to help you in this process for a 5-7 month period.

(Incidentally, I think that having bad communication habits in any business is poor practice. IE: you may be offended by breathing air, but it is certainly difficult to go without it.)

Fact 3: As a homeowner, you will definitely receive higher prices from contractors and sub-contractors than your general contractor will. I have dozens and dozens of examples where the homeowner obtained a quote from a subcontractor and I obtained a quote for the same work on the same home, which was significantly cheaper than the original quote to the homeowner. And I’m not talking a few hundred dollars. In most cases, the amount of the difference exceeded the fees we would charge for general project management and oversite as well as actual contracting work. To repeat, subcontractors do not like to deal with homeowners – their preference is to deal with other businesses. In addition, when a professional utilizes wholesale buying services, like the Home Depot Bid Room,  there are normally material savings of 3%-8%.

Fact 4: General contractors get much quicker response from sub-contractors, by 2 or 3 orders of magnitude (that’s 200% – 300%). More importantly, 40%-60% of all contractors will not even respond to your inquiries – and of those that respond, 75 % will not even bother to visit your home. Truth. Everyone knows this and complains about so stop and think about it and how it will impact your life.

Fact 5: If you are rational and value your peace of mind, you will not try and general contract your own project. It can cause divorce, impotence, general marital discord and a severe loss of sense of humor. Custom home projects involve a 17 % divorce or separation rate – that is an actual sad statistic based on my experience. Be warned. That being said, there are degrees of unpleasantness – if you are reasonably competent, very organized and you are on a crawl foundation in an A zone with a relatively simple lift, you might be able to do the project yourself without completely losing your mind. Doubtful but certainly possible.

An excellent qualified building consultant costs anywhere from $125 – $250 an hour. This would include an architect, engineer or general contractor. We are working with a number of (brave) clients on a retainer basis where there is a fixed not to exceed cost for project management and oversite, which includes a number of hours of consultation work on our end, advising and guiding the project. That is not what I suggest for most clients, but some hardcore do-it-your-selfers think this is a great deal. It’s another option for you to consider.  

So think carefully about total cost. It’s an important concept and definitely something to consider in your calculations.

Off subject and a repeat from yesterday: In your remodeling project, consider installing a natural gas (or propane) backup generator. It’s the ultimate feeling of independence when the power goes out. This happens in many areas, especially those prone to flooding, and you want to be That Person whose house is lit up while the neighborhood is dark.

Gas backup generators are a logical extension to a storm damaged home rebuild. A 2 kw generator will run your house at about 70% of current capacity. The entire installation is about $6,000. Unless the natural gas stops flowing (much less likely than the electricity to go out), you are not affected in a storm event. You sit there comfortably in your house, watch the water run through your pilings and hope you don’t run out of wine.

Stay well NJ.


Rebuild, Renovate, Raise or Repair Your Home from Storm Sandy

Rebuilding NJ One Home at a Time…

Residential Construction & Development for over 20 years in NJ

314 Rt.9, Forked River, NJ 08731 Mailing: PO Box 627, Forked River, NJ 08731

609 693 8881 x 102 Fax: 609 693 3802 Cell: 732 300 5619



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