Dream Homes Ltd. Nearly Famous Rebuilding Blog –
Atlantic Northeast Construction LLC
7 – 13 -14
Happy summer Sunday to you, Sandsters!
So many things to write about and so little time…seems Sunday mornings every 2 weeks are the only time for creative writing exercises, so here we go.
Today we’ll talk about some of the immediate effects of the recent RREM changes eliminating Path C, scheduling notes and comments for your project, getting started (once again) and builder capacity issues. We’ll sadly write a few sentences about scams and other contractor errors which have cost some of my Sandster friends significant amounts of money and give you some ideas to avoid being taken advantage of. Of some importance to everyone is our next Nearly Famous Rebuilding Seminar on July 23rd at the Manahawkin Holiday Inn, which will be excellent and useful for you if you are either planning or have started on your project. Finally, we’ll write about how to efficiently get the estimate or estimates you need from qualified builders in order to move forward.
At least, that’s what I have planned…1500 words later, we’ll see where we wind up. No pretence today about a short blog, since I blabbed a half page for just the intro…brevity is a constant, rarely attained goal of mine.
Anyway, let’s roll…
RREM Path C No More – Path B is the only Path to Rebuilding Happiness (other than winning the lottery and abandoning the RREM program – note that this is a partial repeat from the 6/29/14 blog): As all of you already know, or should know, the DCA announced that as of 7/1/14, Path C is no more. As of June 30, 2014, if you haven’t already signed up for Path C, you will not be able to (trust me – you are better off). There will be only Path B. As an important note, anyone who has signed up for Path C already is grandfathered in and your project will proceed normally under state guidance. To any Sandster stuck in Path C, we will keep you in our prayers. Please see the 6/29 Blog for more detail about this subject or give me a call.
Nearly Famous Rebuilding Seminar Date – 7/23/14 at the Holiday Inn in Manahawkin: Our next Nearly Famous Seminar will be held at the Holiday Inn in Manahawkin and will happen on July 23rd from 6 – 9 pm.
We’ll have Evan Hill from Dewberry Engineering offering advice on engineering and structural issues and Kathy Dotoli, Esquire sharing some legal tips and reminders about safely moving forward with your project. I’m also trying for Scott Lepley, from ARL Architects and Steve Brasslett from Ivy League Mortgage, but both of these gentlemen are (wisely) enjoying the summer and might be in Bimini (or Vermont in Scott’s case). We will see who wanders in. As always, I will be moderating and providing building commentary and comic relief.
Last year’s Manahawkin seminar was very popular and this year should be even better, so please call me at 732 300 5619 to reserve your space. We currently have 14 people confirmed and capacity of about 35, so sign up if you want to attend. Light refreshments will be served.
RREM – More Money!! In any case, now RREM is free to push people to make decisions since there is no more ability to rely on Path C. You’ll have to take a position – either run with the big dogs or stay on the porch. That’s the stimulus that will get the money spent in time for the November deadline. I figure we’re about $150 – $200 million or so short of the goal of $450 million, which is achievable when you consider it’s going out in $75,000 chunks. 1500 or so new Sandsters in the mix and all of a sudden you’re getting it done, and now we have another $800 million to spend on those Sandsters who are on the wait list. This is a really outstanding development for all of us. Please see the 6/29 Blog for more detail about this subject or give me a call.
Material & labor shortages & Builder Capacity Issues – Partial repeat & New information:
As we’ve said previously, prices for both material and labor have increased quite a bit in the last 6 months and they will continue to do so. The upside of steadily increasing amounts of business in the economy is greater competition, which causes a ceiling on material and supply pricing. The downside is that skilled labor and management talent is always and will continue to be a concern.
If you are trying to get a real, accurate estimate from a builder or contractor, try and be as clear as possible about what you want quoted, what is your time frame and most importantly, if you are shopping around to everyone under the sun. No one wants to waste their valuable time with the knowledge that you will be getting 10 estimates before making a decision and that it may be based on nothing other than price. If you communicate this to your prospective general contractor, you will find it hard to get an estimate.
The irony is that RREM will tell you to get three estimates for your home elevation or rebuild project and often you will be really lucky to get one, especially for an elevation project. As much as you may want to compare pricing between various builders, you must consider the other important aspects of that decision: reputation, experience, time to begin and complete, responsiveness, financial strength, and construction knowledge.
As a note, I am generally running about 2 weeks after a site visit for an accurate estimate. I tend to focus on prospective clients who I know want to use our services as opposed to clients who start and end each conversation with “I only care about the lowest price”. Most people don’t know what the total price will be when presented with an estimate, since most estimates are not comprehensive.
As a note, though we do not charge as of yet for this service (since we wind up doing most of the projects we estimate), However, it is not unreasonable for a builder to charge $250 – $500 for an estimate, which should be deducted from your estimate if you proceed with that builder.
Be wary of anyone who gives you an estimate without visiting your project first – it is almost impossible to estimate accurately without going to the site. Remember – “You never Know until you Go” and “The Map is not the Territory”.
Estimates – Pay Attention to Total Cost: As I’ve said in the past and want to stress again, it is not the individual price you receive for an item or a service, it is the total cost to have it installed and working in your house.
Likewise, it is not the number at the bottom of an estimate that tells you total cost, it is what is or is not, included. Sadly, we are now working on rescuing 5 projects where the previous contractor either slipped out in the night, drastically underbid the project or simply doesn’t know how to move forward. In all cases, the amount of money received is far in excess of the work that has been completed.
Key question – Ask your builder or contractor “Is everything included in this estimate in order for me to get a Certificate of Occupancy?” It is common to have line items with pricing and amounts to be determined as the project moves forward, but it is not fair or ethical for your contractor or builder to deliberately exclude items that he or she know are needed (and you don’t) in order to offer you a lower estimate. You wind up going with the low bid, only to be confronted with repeated additions that are necessary to complete your project. Sandsters, this is the oldest trick in the building and contracting book and has been around since the time of the Phoenicians. Don’t fall for it. Ask questions until you understand, or don’t proceed.
In addition, let’s all say it together – “Smart Sandsters are careful to not pay too much ahead of time”. Deposits are certainly necessary and a 5% deposit at contract signing in order to start a file and book a date is quite reasonable.
However, prudent practice dictates that both you and your builder adhere as closely as possible to the payment schedule in the contract or signed estimate. Deposits are sometimes necessary prior to work being completed, with the most common instance being the deposit for the house lifting portion of the project. This might be 20% – 40% of the value of that portion of the estimate and is needed to lock in the date for the elevation. Other than that item and an initial deposit to get started, Smart Sandsters pay for work in place and inspected (if appropriate), not for work to be done. Write this down and post it on your fridge. You are the only one who will know when you are comfortable bending or changing this rule of thumb. If you’re comfortable and live in a neighborhood with 5 other people who have used your builder successfully, that offers comfort and less concern. If you are not comfortable making a payment or are confused, call me, your attorney, your architect or another professional who can offer an objective view of what is happening.
As a note, Kathy Dotoli, Esquire does a great job on this topic at the seminars with sound precautionary advice that is useful for everyone. Visiting your builder’s office and completed and current job sites is always a prudent idea.
Capacity – Can Your Builder Handle Your Project? All businesses have capacity issues and are organized (or not, as the case may be) around a certain projected yearly volume. There are 3 general sizes for builders and general contractors, as follows. Small builders or general contractors generally have a capacity of between 5-10 projects a year and deliberately will not exceed that number. The company will work with the same small subcontractors who will follow from job to job. This is the most numerous category and there are many competent small builders out there. (There are also too many general contractors and modular home builders who have little or no idea how to elevate a home or demolish and reconstruct a new home.) The only downsides to using an excellent small builder other than the fact that you will wait until your project can be scheduled is pricing may be slightly higher than with a large or medium builder. Neither of those reasons is a tragedy – you can wait for the person or team you like or try to find someone else.
Medium size builders & general contractors generally have capacity of 50 – 100 projects a year. We fall into this category, with current yearly capacity of about 125 projects, including new homes and elevations. This year we will complete 45 – 60 projects. Advantages include better scheduling, generally more responsive subcontractors and quicker completion times. As a development and production builder for 20 years, I find it easier to operate at this level because I have a much greater pool of qualified professionals from which to draw. We also enjoy efficiencies of scale and more rapid response times when we have 4-5 projects active in a town or area. This size is small enough where you can enjoy good communication and access to your builder, but large enough to offer the financial resources and depth of construction expertise that is needed.
Large Builders & general contractors have capacity of 150 + projects a year. There a few large NJ contractors & builders that are good and a number of former RREM Path C contractors who come from out of state and should be avoided. There is nothing wrong with dealing with a large local company, other than the experience may not be as personal, you will not be able to change anything once you’ve started without paying significantly for it, and your pricing may be slightly higher than normal due to greater overhead. If you go this route, choose carefully and try to find someone who is currently and has been working in your area. Avoid an out of state contractor if possible.
SHRAP Funding – Many of you know about it and some of you don’t. SHRAP can help pay for rent or mortgages, provide appliances and supplies and pay for other additional soft costs. Go on the http://www.renewjerseystronger.org
Website for more info. Everyone is qualified – you just have to apply.
Extremely bright note – Repeat – GAP funding will shortly be available to Path B recipients! That is outstanding news and long overdue. (I mean, one would rationalize that without a Path C towards which to artificially direct valid Red Cross funding, GAP funding will now be available to Path B Sandsters, but that is unconfirmed though broadly acknowledged as of this date). Once again, great news. Remember, GAP funding is income based, so if you qualify you get it. $30,000 is $30,000 and I specifically know it will help bridge the gap for a lot of people.
Repeat from 6/23 & 6/29/14 Blogs – Sandsters – Call to Action! If you want to enjoy your house this summer but still want to be back in your elevated home before Thanksgiving or even the end of the year, you must start your design scope very soon. You will want to have your final plans, survey, plot plan, flood elevation certificate and permit packages ready to go immediately after Labor Day (for Thanksgiving) or October 1 (for end of year), which means you should have started already or be getting started in the next few weeks. If you still need a soil boring and geotechnical analysis, make sure you order it soon. You will need to call for electric, gas, phone and cable utility disconnects yourself, and your builder will generally handle water and sewer cut and cap services. When you do call for disconnects, make sure you request a date certain for the shutoffs.
The point is to not procrastinate too much longer if you want start in the fall and be back in your house before Thanksgiving. So stop pondering and pull the trigger!
New Sunset Beach Model arriving soon in Toms River! For those of you thinking of designing a new home, we’ve recently introduced a new model called the Sunset Beach. It’s a very different house with a distinct island look and feel. This model is being done in about 1800 square feet but can be as small as 1400 and as large as 2500 square feet. Send me an email if you want to check out the new plan. We’ll be starting the house soon on Rt 37 West in Pelican Island so stop by and see us.
Elevation – Repeat – Definition: Remember that elevation refers to “height above sea level” and not the height above grade at the house or distance the house is being elevated. It’s easy to make a mistake with these descriptions and it causes much confusion. Example: If you are raising to elevation 11, your finished floor is 6 and your grade is 4.5, you are raising your house 5’ to elevation 11, or 6.5’ above grade. When you use the expression “elevating my home 5 feet” that means you are lifting it 5’ from where it is now. The expression “building or raising the home to elevation 11” refers to the height above sea level, not the distance you are lifting.
You Tube Link to the last Nearly Famous Rebuilding Seminar: If you’ve missed our seminars and can’t easily attend, here is a link https://www.youtube.com/channel/UCVI69KoM8DRXqoEblHd94xg
It is not edited and is about 2 hours so feel free to fast forward and skip around to watch what you like and need to know.
Searching the Rebuilding after Sandy Blog for Your Topic: One of the (few) nice things about WordPress is the Search function. Just enter a key word and it will take you to blogs where the subject you’re interested in was discussed.
Special Feature for clients from Dream Homes: We take photos of all of our jobs on a regular basis and upload them to Dropbox. We then send a link to each client with their houses folder, so they can see what’s happening each day. Everyone seems to like this – you can feel very connected to the process even if you can’t be there.
Remember – if you have a specific question, send me an email or a text. You don’t need to wait for a seminar or a site visit to clarify a point or two. The same goes for those of you under construction. Whether or not you are Dream Homes/Atlantic Northeast Construction client or not, I will always try and help you or guide you in the right direction. If you’ve sent me email or left a voice mail and have not received a response within a day or so, please try and contact me again. I do miss messages here and there.
Note to Sandsters: Though I began and continue to write this blog to help as many Sandsters as possible, Dream Homes Ltd. and Atlantic Northeast Construction LLC are new home builders and general contractors who are actively renovating and reconstructing projects up and down the shore. We actually do all of the work that I talk about in the blog. We work with private clients and Path B in the RREM program. Call, text or email to set up an appointment for an estimate on your rebuilding project.
That’s all for today Sandsters – generally good news and I hope it helps you. As always, call or write with any questions.
Dream Homes Ltd.
Atlantic Northeast Construction LLC
Licensed NJ New Home Builder License# 045894
Licensed NJ Home Improvement Contractor License# 13VH07489000
PO Box 627 Forked River, NJ 08731
Office: 609 693 8881 F: 609 693 3802
Cell: 732 300 5619