Hello everyone and welcome back to Building with Brevin. We are in a new year. It is now 2024 and this is episode #19. We're excited to be back for another week and a new year actually. You know we've got a lot of cool podcast episodes and ideas and content for y'all. So definitely be sure to stay tuned and listen to the podcast throughout the year. We're going to continue to do everything we can to provide the
most value for you guys. But before we kick this episode off, Brian, how was your How was your holiday season? You know, it was nice, really relaxing and fun to spend time with family and friends and and I love this time of year just because of that, But also the downtime when you talk, when you talk work, because when you're not working, most everybody else isn't working this time of year. Every other time of year you take time off, but everybody else is still still bombarding
you in a in a good way. I don't mean that in a bad way. So really nice to just relax and have a lot of downtime all around you. How about you? Yeah, no, I couldn't have said it better myself. It's it's great time of year. It's always exciting. Christmas is always fun, the holiday spirit. But yeah, we had some really good family time and got to spend some time with my wife Sydney's family up in their new lake home up in the Dallas area. So yeah, it was beautiful and
got to enjoy some time off. Quick reset and now we're ready to hit it hard in 2024, as I'm sure most people are, you know, these New Year's resolutions are a real thing. So anyways. One, one of our, I don't know that we'll call it a resolution, but something that that Steve and I've talked about for the business is, you know, a lot of people come back into the New year with a lot of energy, a lot of optimism. Hey, I want to change some
things. I want to be a better husband, wife, spouse, person, whatever it is I want to do. I have career goals. I have personal goals. But you know something for us is we're extremely grateful for our listeners, for the people that have worked with us in our business, in all aspects of our business, whether you're a home owner, a past client, just people that talk to us for advice, contractors, suppliers, all that.
So really what it's about is just making sure that as you said at the beginning, we continue to add a lot of value to to all of our listeners. But just really keep that energy up right when when you're when you have a lot of a lot of energy it's contagious and and people around you get more energy and then we want to pass that along.
So I know it's going to be hard to quantify that but while we have a lot of energy to kick off this year something that I want to make sure we maintain a conscious effort to just stay on top of. So hey we're we're grateful to be in business really really proud of where we are in 24. Obviously we have aspirations and goals and want to grow, but let's let's keep that inner energy high this year. Love that. Yeah, I love that. And just like you said, that energy is contagious.
So hopefully we can pass that through these microphones and on to the listeners that all of us will be better off in this new 2024 year. So without further ado though, this is going to be a great episode. I, I hope for everybody. We really wanted to kind of recap one of the episodes we've already talked about, but in a different spin. And so I think it was one of our
most popular episodes. This is going to be some great value and it's going to have some different golden Nuggets as we like to say or some different insights. So it will be kind of quicker pace and we're just going to run through basically the gist of this episode, which is how do you turn your dream home concept into reality in this new year. So it's a new year. Like we said, a lot of people have that high energy, they've got these high hopes for the
year. How do we keep that going and take that concept of a new home and turn it into an actual reality? So, yeah, I guess that being said, Brian, I guess I'll kick it over to you to start this thing off. I mean, where should people start when they're, they've got this idea in their head they want to turn the stream home into reality. What's the first step? I I think it all starts with understanding your own wants and needs and finances, right?
And I know that sounds extremely basic, extremely elementary, but everybody has a budget no matter how much money you have or will have, everybody has limitations on on a lot of different
aspects. So you know I I think it starts with what am I comfortable in paying for a project all in and then starting in a in a sense starting to work backwards right from there and then quickly beginning to look at OK, what's my timeline, where do I want to be starting to look at land whether you want to do that on your own or you engage a a realtor in that market so that you can say OK, this is my budget, how much am I looking at for land and does this add up?
And I think a good metric here Steven is you know we don't like the the land cost to be any more than about 20% of the build ideally lower than that. But 20% is seems to be a number that's thrown around. You know, for our homes that we build, we try and stay under that number and sometimes it gets close, but that's just a good ballpark when we talk about early on budgets of what you're comfortable with and as you start to think about OK, what what's my land look like.
That's so funny you say that, because I was literally thinking about this show and what we should talk about. And when you mentioned land, that's exactly the number I had in my head too. We've always talked about that. But that 20% rule is kind of a, it's not hard and fast, so don't hold us to that, but it is a good benchmark, right. So if you're looking at $1,000,000 home, just to put this into numbers, you're looking for probably $200,000
lot or less. Now if it's got special features, of course, if it's on the water or it's in the Rocky Mountains in Colorado or on the beach or something, of course that's going to shake those numbers up in those proportions. But a general custom home and a custom home neighborhood somewhere in the suburbs, you know of any semi, semi big neighbor or city, yeah, that 20% benchmark is is a really good rule of thumb. So great point.
That's a great point though. If you're going to be in an urban area where you have a tear down and you're paying a lot of money for a piece of land, it's a fine balance of OK, well, I don't want if that's 20%, you don't want your home to be worth, if you could even afford it, 5-6 million when every other home around you is worth a million or two, right. Be within reason of the other. So again, not a hard and fast
rule. It's going to vary significantly based off of the market you're in, where you're looking, but predominantly on where we build being in the the Hill Country of Texas and in the the suburbs where you know acre lots, 2 acre lots, 3 acre lots even smaller than that, that 20% is the number that comes to comes to mind. Yeah, absolutely. And that's a good distinction too, that if you're in the city, yeah, of course it's going to be
higher. If you're out in the in the rural areas outside of the city, then it could be very well lower, right. But you also may be looking at more land and like you said, something to definitely keep in mind is that you don't want to be building a 2345 million dollar home in a neighborhood that only supports homes in the 800 to $1,000,000 range, right? You're going to be out building the neighborhood and it's a bad decision. So anyways, yeah, that's quick notes on land.
So after land, so you've got your budget identified, you've potentially started working with a local realtor. We recommend, you know, try to find the best realtor in the area. They can be a huge asset, a a not so good realtor can also be a liability for your land search and they could also talk you into a piece of land that's not in your best interest, but it is in theirs and you know it.
It could be a bad deal. So before you sign any contracts with purchase of a land or a lot or piece of land, we absolutely recommend that you need to be vetting builders and starting to narrow down your builder list. Now as you've got that narrowed
down, this is the next step. You need to find your builder that you feel you can trust to build your dream home on that lot that you're seriously considering and about to close on. Any builder that's reputable and in your area can give you valuable insights on land in that area. A realtor doesn't build homes, just like most builders don't sell real estate, you know, like Realtors do. So it goes back and forth and it's they're not interchangeable.
So don't take your realtor's opinion on what's a good lot for a custom home built that takes a builder to tell you what that is, right? So there may be a solid rock underneath your lot, or it may be on bad soil, or there may be other things that you're not aware of, but your builder is. So definitely a good idea to get your builders insight before you close on that lot. I I can't stress this enough.
I mean I think that talking to builders even if you haven't formally selected a builder to to get you all the way to the finish line with a with your custom home is really important.
Steven. We can't stress enough that the the delays and unexpected cost that that we have seen both we've experienced personally in our business but also in talking to other builders on people getting too far down the road without a builder and then they have to go back and do some work all over again because something didn't didn't work right or hey this isn't going to on paper this looks good but when a builder gets involved, hey that's not feasible when we
build it or hey the house can't sit this way because you have a big drainage Creek in the in here that's not shown on paper, right. So the sooner you get a builder involved, I think the smoother the process is going to be. We can't stress that enough. You you can't bring in a builder. Soon enough, Absolutely. Absolutely. Yep.
Good good additions there. And then once you feel like you've got your land locked in, you've got your builder stamp of approval on that land and you feel good about the builder that you selected. Which if you're not sure how to select a builder, we've done at least one episode. I know of maybe even more that where we've talked about how to select a custom home builder for your new build. So definitely go back through our previous episodes and and
listen to those. But you've got your land, you've got your builder, you've addressed your budget with your builder, and that's when it's time to rope in an architect. So you start working with an architect and probably even an interior designer for most cases. Custom homes take an architect, a designer, a builder, a whole team of people. But this is where you want to start working with that design team to really start to customize your lot, to fit the home that you want.
And you need all the needs and wants in that home and within your budget. So yeah, that's definitely something that the architect will help you with. The designer will help you with in the builder as well, you know. So don't think that you can get through all this stuff without a builder, because the builder can put pricing to all this stuff. They're going to be the ones who can match your budget with your dreams. Any insights there? Any input?
Anything I missed? Yeah, I think that it can be challenging for for homeowners at this stage to say, well, how do I choose a builder when I don't know how much this is going to cost. You told me to have a budget. Well, I have a budget, but sometimes it's that chicken or egg approach like, hey, I feel like I'm getting ahead of myself and there's there's different orders you can do this.
But again, pull a builder in as early as you can, ideally before the design phase because that builder will help you. We talk about the term value engineer, but the, the the builder will help you make sure that you stay within that budget, right. Early on professional builders including ourselves, we talk in ranges, right. It's going to be, it's a very fair question to ask early on, what's your price per square foot?
OK. Well, that's that's a, that's a question that I would ask, but it's a very, very challenging question to answer early on. Now we can give you that, but it's going to be a range because there's just so many variables and we can't. It is our job to do our best to not misguide your expectations. So you want to make sure that's
in line. And the other thing I would say is you know you you're working with a builder and an architect and most if not all builders that that we've dealt with or have have experience with at this point you're not, you're not liable or tied to again building that home with them. You can this. These are just all steps in that
pre construction process. So you know if something goes sideways or unfortunately something goes the way you didn't expect it to it's not like you're just in this this the the the state of an agreement that you don't like and and you can't get out right. That's all too often we we hear about the nightmare stories and and you know you just want to make sure that everybody's protected and and there's there's ways out at the right times.
Yeah, I really like that you brought that up that just because you've consulted with the builder for these preliminary or pre construction tasks or items throughout the design process. You're absolutely right. Don't feel like you're locked into them as long as you have not signed any building contracts with them.
They may have had you sign design contracts or pre construction contracts of some sort, but just be very aware of what you're signing and don't sign a full build contract before you get to the starting point of that build. So you know that's why we implement a a design contract where we'll help you work with the architect and the designer and come up with a realistic budget for everything that you want and help tie all those pieces together.
Then we have our PBA process which actually leads us into our next point. PBA for US stands for a preliminary building agreement basically that's going to cover everything that's in the pre construction process. So we're going to take that plan in those selections that you made. We're going to take those all the way through engineering, get them basically all the way to the point where we have a fully buildable floor plan set.
We've got engineering, we've got design, we've got budgets, we've got timelines, we've got everything we need to give our clients an accurate estimate of how long is this home going to take to build and what's it going to look like and how much is it going to cost. You know, and those are all things that any builder that our listeners are are talking to, they should definitely ask those questions and make sure that they're getting those answers that they need.
So yeah, that pre construction process is the next step. After you've worked with an architect, you've come up with the design, you've had your builders input. Everybody feels good about those preliminary numbers or those estimates. Like Brian said, the ballpark estimates you move forward with the pre construction process and that like we mentioned is a lot of different things, but
engineering is the big one. And you know after the builder has all that information, then they can put that into a formal proposal. And in in our case, we give a fixed price contract at that point. So we can give the homeowners, future homeowners or you know buyers at this point the exact cost that it's going to cost them to build that particular home on their particular lot. Of course that fluctuates as change orders occur or other unknown and unforeseen circumstances happen, but it's
all in the contract. So anyways, yeah, that's the pre construction phase. And then, yeah, after that, go and do that. Then we get. To the fun stuff we go right into, ideally we can the the our preliminary building agreements can be structured many different ways. It could include permitting if you say we're ready to go. But really what we often times do is get everything up to the permitting phase and then present you with a fixed price building contract proposal.
And at that point if you say, hey, we're ready to proceed, then we would begin immediately with permits, ACC, architectural control committee, architectural review board approvals because at that point we're ready to start building. So you know all the while you're working on financing which we can guide you on that that can either if you have cash obviously that makes it a little more simple.
We would just have a draw schedule in the contract of when we would we'd pull the money but working with the bank that's very common as well. And you'd be you'd be basically getting to the starting line about the same time we would working on your the the construction loan and things like that. So then we get to the fun part permitting and and actually building. So that's where you get to see your your dream come to life and
it can be a long, long process. Up to that point Steven, we've seen some of our projects take 40 to 50% of the entire time since people start talking to us to when they close on the home can be prep, work preparation, pre construction work, moving dirt building retaining walls, doing lot cuts where we have rock in the grade is too steep. So we've we've seen that happen
where 30 to 50% can seem crazy. It it depends significantly on the project, but 30 to 50% of the time with the builder could be pre construction, then the rest is actual construction of building a home to to the actual closing date and then movement date. Yeah, that's a fantastic point. And I think that's a a really good percentage for listeners to keep in their head as they're taking steps down this custom home journey. Yeah, I mean I had it broken to
me at one point. You know, it was very early on and it was one of the first custom homes that I built. I got all the way to the point where we were about to start the actual building and one of my mentors said congratulations, that's 40 to 50% of the work right there. And I was thinking, oh, OK, cool. You know, that seemed like a lot of work and it was, you know, it's like you mentioned it's 30 to 50% of the build.
It's just getting to the starting point where you can break ground on that lot or get it ready for your foundation. And so from there, I mean, hopefully all the pieces are in place that the rest of the build goes fairly smoothly. You know, of course, there will always be Rd. bumps and things
throughout the build. But yeah, I mean that preliminary planning process is so important and doing it properly and doing it right is it makes the rest of the build and the whole experience so much better. Yep, Yep. Couldn't agree more. And you know, I think it just reminds me Steven, that no matter what builder you choose, understand the custom home building is a journey. There are things that are going
to go wrong, right. This is a major project and most and with most people the largest asset that they that they purchase in their lifetime that they get to see come to life in in construction, things go wrong. But often times many of those things that go wrong can be
fixed. They will be fixed and and if you're working with a professional builder, you get through it in a lot of those hiccups you don't even remember after after closing because hey, it was there, but it's been corrected and we're very happy with the finished product, right. So no, no two homes are built the same, even if they're identical, right. And so it's it's not not to say that oh every builder out there
is is bad. It's just it's just part of construction that that's the nature of the industry of construction, you name it residential, commercial, industrial. That's just how it works. And so I think people educating themselves through podcasts like ours and others before they get into it just helps them with the the proper expectations and allows them to set their expectations in a better place so that they can just enjoy the
the build. That make it more enjoyable throughout the the entire process. Absolutely, absolutely. And I like what you said there that you know it's there's so many different phases of the build in itself once the home actually starts construction that yeah, if you've chosen the right builder that you feel like you can truly trust, it should be an enjoyable process.
From there, of course there's going to be hiccups and other things along the way that Run foreseen, But overall it should be an exciting process to watch your new home come to life. And there's fun phases where the home seems like it's making leaps and bounds of building. And then there's also phases where it seems like nothing's going on. But we can assure you, as a builder, there are. There are things going on for the most part, you know.
Now if you've got a builder that the house is sitting for weeks or months on end with very little progress, then something else is going on. But you know, the home is in sheetrock phase. It's not common for sheetrock to take 3456 weeks, depending on the size of the home. And that's from the time they start hanging it. They can hang the sheetrock in anywhere from a couple days to a week. And then it's a lot of tape and float and dry and tape and float and dry.
And so you get my point that, you know, there's ugly duckling phases of the home. There's times where it seems like nothing's going on, but if you've truly picked a builder that you can trust, it should be an enjoyable process and you should know that your build is being taken care of as it needs to. Now, I do say you know, as a client you still want to make sure that everything that has been discussed with your builder is being implemented.
So if they've told you things that they're going to do and they're doing it, great. If they're not, have a discussion with them. But also, all the selections that you've made, you've got to keep in mind that this is your your home. This is your opportunity to make sure it turns out the way you want it. If there's a change order or something different you want to see, feel free to speak up. You know, that's definitely not uncommon in custom home building.
And any good builder would want you to, you know, get everything that you want in this new custom home of yours. So ask your builder and talk through those kind of things. Good communication is key. And that goes both ways. Yep, Yep. For sure. And really, that's the fun part of it. I mean, to wrap it up, you get into the warranty phase, which is really important with all professional builders. There's going to be things that need tweaking after you move in,
right? Nobody's ever lived in that house. There's things that, hey, this is a little bit off, there's adjustments that need to be made. That happens in 100% of the houses that have ever been built. The important thing is that you have a builder that is happy to come back that is wants to make sure that you're beyond satisfied and just gets those things right. So yes, it can be challenging where you get into some Gray area of hey, we can cover this or we can't cover that.
So there's there's a whole separate discussion on on warranty to make sure that it's within reason and and fair to both sides. Obviously if you say hey there's there's a hole in my wall and you put and you or the one and the homeowner was the one who did it, but you want us to replace the whole wall. You know there's there's obviously the the the warranty requests have to be within reason and then that's a whole whole other separate session that we could talk about for days.
But you know something that is important, it's important for the homeowner and that the expectations on the warranty phase are just as clear as everything else throughout the build of what what is covered, what's not before you get to that that point in time. Yep, Yep, for sure. And there's things that are warrantful. There's also things that fall back on the homeowner as homeowner maintenance, as we say.
So don't be surprised if your builder isn't covering 100% of things that happen after closing on your home. And it's not a it's most times not a bumper to bumper warranty as people like to say. So you know there are outside factors and Mother Nature and other things that require some homeowner maintenance and and that's exactly why it's called
that. But a good builder, like Brian said, is going to try to do everything they can to make sure you, the client, are overly satisfied with everything that they're doing after closing and with your new home, because that's what's most important is that you're comfortable and excited and settled into your new home as quickly and as best as possible. So yeah, Brian, what do you say, let's, let's wrap this up. Let's run through this list just one more time, real quick, just to recap it.
So I mean, how about you take us through it just starting from the beginning and maybe one sentence on each thing? So it starts with with a the setting your expectations on a a budget and getting your own thoughts together, collected together in terms of wants needs and your financial picture, right #1 #2 considering land, where do you want to build, what's your, what's your overall cost that that your, that the
land is going to be right. We use that 20% rule of thumb very, very, very wide but very wide range could be there but 20% is is what we threw out and you pull in a builder as early as you can right number around. At the same time you're looking at a bit at builders that you can start to engage really more from a consultative approach. Not so much of, hey, I want you to build my house, but beginning to earn to to trust them to enjoy working with them and building that partnership.
That's essentially what that is and saying hey, if it doesn't work, you know you're you're not tied to them. You can pivot before you actually start construction. Next would be working either with that builder or with their preferred architects or or wherever you're guided in terms of hey, I got to start putting my thoughts on paper and that also is of course in line with my budget.
So getting that getting that plan set together with a with an architect and then the the big bulk of the pre construction work even though there's a lot that's been done by this point is, is really what we call the preliminary building agreement. But that's where all the rest of the work is done in terms of really just trying to get organized on this project before
it starts. So the engineering piece, the the, the timeline, the the rest of the budget, getting things organized for the signing of a contract, right, whether it's fixed price or cost plus every builder has some form or former fashion of a preliminary building agreement at least the professional builders do, right. It may not call it that, but there's other prep work that has to be done whether it's internal or in, in in line with something that they expect of you.
But there's there's there's quite a bit of work there that that needs to be done early on whether it's part of APBA or part of the beginning of a building contract. So just get get some clarity around that with the builders you're talking to and then permitting of course if that's required or or architectural review committee approvals based off of where you're building if there's any approvals that are needed with cities, municipalities, municipalities,
HO as things like that. And then from there, it's, we're only by that point we haven't done anything, but we're we've done a lot. We're like we said 3050% of the way done and we get to build, you get to see the house come to life and move in on your closing date and then get into the the warranty phase, right. So again, really important to
understand the phases. There's a lot more underneath this, but you know we want people to understand the flow because time and time again we talked to people all over the place that are just overwhelmed on where do I start, right and it's a very good question. I would have that question if I was not in the industry. It would be the first question I would ask. Yeah, fantastic recap.
I think you definitely said it well and it's a good way to wrap this up. So thank you for that and hope the listeners got some good value out of this episode today. Like you said, this is really a good baseline for what people need to follow in order to turn that concept of a dream home this year into an actual reality. So let's, like you said at the beginning of the episode, let's carry this energy and continue it through the rest of 2024 and
let's make it a fantastic year. Let's build some houses and hopefully our listeners will do the same. Yep. And what I would ask of the listeners with the energy in mind is if there's any feedback you have on what you want to hear more of, we'd love to hear
from you. If there's anything else that we didn't clarify very well or you want us to dive into that that that will feed our energy and and get us excited to, to really nail a topic that maybe we haven't covered or we've missed or just need to do a better job of of addressing. So please, we want to hear from you. Yeah, that's a really good point. And please do, I mean, we're not just saying that. We really do want to hear from our listeners.
And the best way that you guys can do that is to go to our website. We're www.brevenhomes.com. That's BREVEN homes.com and we've got our contact info on there. So of course this is building with Brevin, but that's our building company's website can reach out to us through there or drop comments in whatever platform you're listening on and we'll be sure to take a look at those. But yeah, we're excited to provide more valuable content to share and hope you guys find
value in it as well. Let's make it a good year. Awesome. Thanks, Brian.