Dream Homes Ltd.
Atlantic Northeast Construction LLC
Nearly Famous Rebuilding Blog –
Hello Sandsters –
I hope this blog finds you and yours healthy and well and enjoying your Sunday.
We have some interesting items for you today in the world of Sandy rebuilding and RREM. We’ll mention again the excellent article in the Asbury Park Press from several weeks ago where I was quoted and send you a link. We’ll speak on the difference between estimates and contracts. We again mention a few ugly communication habits and how to avoid breakdowns in communication. Finally, we talk about our next Nearly Famous Rebuilding Seminar which is Thursday night September 10th at Tuscany Bistro Bar in Toms River.
Nearly Famous Rebuilding Seminar – Thursday, September 10th, 2015 – 6 pm:
Our next Nearly Famous seminar will be held on Thursday, September 10th at the Tuscany Bar & Grill restaurant in Toms River, across from the Ocean County mall on Hooper Avenue. We were last there on June 25th and it was great. As we did during the last seminar, out theme will be Getting Started, and we will focus on Sandsters that are early in the process, and have not completed design work, or chosen a builder or architect. We will continue to concentrate on engineering & architectural design advice, RREM guidance at the initial stages, and information about choosing the right builder or contractor. It really helped to focus the topic for the Sandsters that are just getting started and need specific advice, and that will be where we focus at this seminar also.
We will be in the Fire Room, which is an indoor/ outdoor space. Our speakers vary, but we will most probably have Kathy Dotoli, Esq., Scott Lepley, architect, and myself. The last seminar was really great and being able to have a glass of wine and some hot pizza was a nice touch. The room only holds 25 people so if you are interested, please call or email me to reserve your space as soon as possible.
Estimates versus Contracts – What is the difference?
Often Sandsters will request an estimate from us or a builder of their choice, prior to any design work being completed. This is primarily due to RREM demanding it prior to your grant signing and partly due to Sandsters needing a general idea of the monetary scope of their project. I have several thoughts to share on this subject.
First, many builders will not estimate a project without finished, or at least preliminary plans from which to work. Over the years, I’ve realized that though it is more work for us, many Sandsters have no idea of the scope of their project and cannot imagine what it will cost. So we regularly prepare estimates without plans, working with information from each individual Sandster, on site measurements, and available flood elevation certificates and surveys.
This approach is good because it makes people happy, but has its limitations. It is always preferable to work from final plans.
Without a soil boring, foundation inspection and finished plans, many items are estimated using experience and the best assumptions about construction methods. One of the key unknowns is foundation construction, which cannot be definitively ascertained prior to a soil boring and foundation inspection.
Generally, our estimates are very close to the final scope of work. As long as the type of foundation is correct in the estimate, an estimate that is accurate to within 10% is very good. We generally fall within 3%-5%, and slightly under half the time the estimate decreases once final engineering is complete.
The largest item that causes changes in the estimate is the type of foundation construction. The good news is that if the RREM estimate is incorrect, once you start design work, you can present the findings to your PM and request more money. In the 3 years since Sandy, I have never seen a client refused additional funds when this was the case.
Remember: If you have a concrete block foundation, RREM always starts with the assumption that you can add block to your existing foundation. That is fine to use as an assumption across the board, but it is a best case scenario and does not generally comport with reality in the field. RREM often ignores or misses other major items such as slab portions of the house that need new floor systems, as well as duct in the basement that will necessitate elevating the house an additional foot or 2.
A good builder will not estimate your project based on preliminary RREM scopes of work alone, but rather will determine what is needed to actually build your project through to completion. IE: I will tell you what you need to get your job done based on my professional opinion, since I have to actually build it in the town you live in. RREM program managers don’t build things and are not responsible if their assumptions and calculations are incorrect. I do and am.
So when your design work (soil boring, preliminary architectural and engineering) reveals that helical piles are needed, or an existing foundation must be completely removed and rebuilt, you can and should go back to RREM with these findings and request additional funds. Example: If you are adding 4 courses of concrete block to a foundation it might cost $15,000. If you need to completely remove and replace the existing foundation and footing, that same category in the scope of work might be $40,000. If you need to remove the old foundation, install helicals, pour a grade beam and block up a new foundation, it might be $65,000. If the RREM estimate dictates a 32” elevation and you need to elevate 48” because of local code or existing conditions at your house, costs increase. These are material differences and items that RREM will pay for.
Remember, when you request additional funds based on evidence uncovered during design work, you are not frivolously going back to RREM and asking for a nicer deck or kitchen, you are making them aware that the assumptions they worked under when they determined your grant amount were based on incorrect or incomplete data.
Design work and timing: Fall 2015. You should be working now on your design scope or (even better) submitting plans to your local building department so you can schedule for a September / October start to your project. We currently have a dozen Sandster projects we are starting in the fall – all have either completed design scope and been submitted or have been approved with permits ready in late August or early September. Now is the time to make plans to secure alternate housing. Remember, there are much cheaper rentals in the fall/winter at the shore.
Repeat from last week – “Up in the Air – 1000 days after Sandy”- There was an excellent article published on Friday July 24th in the Asbury Park Press, where I was quoted specifically on the subject of delays caused by RREM payments. It is entitled Up in the Air – 100 days after Sandy and has a tremendous amount of detail about RREM progress and the status of many RREM projects throughout the state. The link is below.
Delays in your project II: Why are they happening? See the Rebuilding blog from last Sunday, 8/16 as well as the one from 7/4/15 for good information about this subject. One key point that deserves repetition is that if you see your project sitting idle for a period of time for no obvious reason, that is an indication that there may be money issues and you should proceed with caution.
If you have any doubts, ask for a Lien Waiver/Payment certification from your builder or contractor before giving him any additional money. This document certifies to you that all material and subcontractors have been paid in full to date and should there ever be a claim or a lien filed, your builder will be solely responsible to address it at no cost to you. If there is any hesitation, or if your contractor is unwilling to provide such a thing, do not move forward with any payments before receiving proper legal advice.
Behavior to avoid and how to survive your project – Partial excerpt from last blog – See 8/16 blog for full text
For the record, yelling, screaming, cursing, threatening to call the Governor, the DCA, the President, RREM and your astrologer is not the way to achieve positive results in your project (or anywhere in life0. It is hurtful, non-productive and achieves no purpose. People, being people, tend to shy away from communication with people who are acting in an irrational abusive manner.
Winston Churchill said, “Jaw, jaw is better than war, war.” It is infinitely better to meet, discuss and work out differences than it is to cease communication and man the Bastille. Or “It’s better to be nice and achieve results than it is to be nasty and achieve nothing.” Or, “One catches more flies with honey than one does with vinegar.” Choose your bromide – they all say the same thing.
In recent conversation with several RREM program managers, we’ve heard these direct quotes, “I am handling 220 cases and 207 are unhappy with their builder”. “The majority of RREM clients are unhappy with their builder”. If you as a builder are making more than 50% of your clients happy, you are in the top 3% of all RREM contractors.”
(Author’s note: Currently, 96% of our clients are happy or fairly content with the progress and quality of their project.)
The moral of the story is this: 99% of the time things are not nearly as bad as you perceive them to be. Our perceptions, obsessions and consideration of other’s opinions rule us and cause us to become temporarily insane. Stop drinking the “It’s a disaster!” Kool-Aid – it’s rarely a disaster. Be nice and get results. Be mean and nasty and get nowhere.
Enough said. If any of this resonates with you, take a deep breath, thank God you and your family are alive and healthy, and start behaving in a sane manner. You will live longer and be much happier in the meantime.
Managing Your Expectations – How to Remain Sane II
No elevation project goes perfectly. It doesn’t matter how great your builder is, there will be mistakes and delays. It’s not how to avoid them happening, it is how they are dealt with when they occur.
This whole subject gets a lot of comments when I write about it and bears repeating.
The saying “The best laid plans of mice and men….” is quite accurate and seems to have been created to describe construction projects in general. No project goes exactly as planned, but is rather a fluid series of events which is constantly changing. Having a realistic, flexible attitude about normal delays is necessary if you do not wish to wind up in a mental ward during your elevation project.
Note 1: If a projected date for an event is missed, do not panic. Remember: You are not paying to be educated on how to build – you are paying for a finished project. It is the end that matters, not each messy aggravating moment throughout the process. Keeping track of events means following a general time line and not obsessing over each detail. Believe me; you do not want to know each detail in the 1000 step process to complete your project. Again, that’s why you are paying a professional to handle the process.
Note 2: When a contractor or professional promises your builder an item will be ready at a certain time and your builder relays that information to you, he is representing what he believes will be occurring, to the best of his knowledge. If the subcontractor, professional or material supplier does not perform in a timely manner, your builder didn’t “lie” to you. Trust me – he or she is much more annoyed and inconvenienced than you are.
Contingency funds vs. Design scope funding:
I’ve written and spoken extensively about this item but Sandsters are continually confused about it, so I’ve started to include it below in the glossary of definitions which is a part of each blog. See below for more information.
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Definitions & Important Considerations That Can Delay Your Project:
Lowest adjacent grade (LAG): This is an important elevation since the lowest point in your crawl space has to be even or above the LAG. That is important because even if you don’t want your crawl filled that much (so you have more storage space) you will not pass final zoning / final building if this condition is not met. LAG is defined as the lowest grade immediately next to your house. There can easily be a foot or more difference between one side and the other, or back to front, so if you wish to use the least amount of fill (maximizing room in the crawl) make sure you find the lowest adjacent elevation.
Elevation: 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 your home 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.
Survey: An exact depiction of what exists on your lot, from a top view.
Plot plan: A top view of what you are proposing to build, including new heights, stairs, entries, decks, etc.
They are not the same and you will need both for your project.
HVAC Elevation height in crawl space: This must be considered when planning your lift. This is the elevation of the lowest duct, furnace or air handler in your crawl space. Most townships require a minimum elevation of base flood, some townships have no restriction, and some are at minimum BF + 1 to the bottom.
Design scope: These costs are defined as architectural and engineering fees, all survey costs (survey, plot plan, foundation as built, flood elevation certificate and final survey), soil boring & geotechnical costs, cribbing diagrams, permit fees, soil conservation design, and wind load calculations.
Please note – you do not get $15,000 in cash to spend on your design scope. You get up to $15,000, depending on what your actual costs are. So if your design costs are $9,200 you get $9,200. If they are $14,000, you get $14,000. If they are $16,600, you get $15,000. The balance of any remaining money in the $15,000 design scope budget does not go back into your grant and you don’t get to keep the extra cash.
In the “to make matters more frustrating and confusing category”, if you signed your grant prior to October 1, 2014, you are not eligible for the extra $15,000 in design scope funding.
Note: I have seen a number of clients kick, scream & please enough to have the $15,000 added to their grant, even though they had signed before 10/1/14, but that is not the policy.
Contingency costs: This item is part of your grant package and is designed to provide for unforeseen events or conditions that must be corrected in order to obtain a Certificate of Occupancy (CO) and finish your project.
These are not mistakes, omissions or errors on your part, your builder’s part or the design professional that did the plans. Rather they are items that are not knowable or evident in the actual structure until it is elevated, or the result of one of the shore townships deciding arbitrarily to change, invent or augment the existing building code. These items include (but are definitely not limited to) rotten or termite infested sheathing, wall studs or sill plates, twisted, broken or rotten girders, site conditions or changes needed to comply with current codes which were not in place when the house is built, upgrades to water pits or valves required by the MUA, installation of hard wired smoke & CO2 detectors, installation of condensate lines to the exterior from the dryer, and about 50 other items that we’ve encountered. These items should be itemized by your builder in a separate sheet and submitted to RREM. 95% of the time you will be reimbursed.
There is not a monetary limit to this contingency, although it is generally 5% – 10% of the grant amount.
The contingency does not come out of your grant award.
You Tube Link to a 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.
Remember – if you have a specific question, send me an email or a text. Don’t wait for a seminar or a site visit to clarify a point. Whether or not you are Dream Homes/Atlantic Northeast Construction client or not, I’ll always try and help you or guide you in the right direction. If you’ve sent an email or left a voice mail and haven’t received a response, try and contact me again. Messages are lost occasionally.
Note to Sandsters: Though I 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 clients 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. I hope it helps you move forward. 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