Underestimating Cost: How to Lose Money as an Owner Builder

Written by Andrew Morrison

losing moneyNow that I have your attention, I want to talk about a common mistake that a lot of straw bale homeowners make early on in the process. Often the most fatal mistake of any job is underestimating how much it will cost to build that beautiful home you worked so hard to design. Common examples of this are not including enough money for framing materials or electrical fixtures. Not so common is the mistake that comes before the numbers are even run: who will build the house.

I have heard many people say they will build their own house so they can save money only to find that they end up spending far more in the end than they would have if they hired a professional.

This is something most would be owner-builders don’t want to hear. The fact of the matter is that building a house is time consuming and hard work (both labor wise and mental organization wise). Since most would be owner builders have a job, it means either time off work (lost wages) or working on the weekends or off days (lost sanity).

The longer a job takes, the more expensive it will be for a number of reasons. First, if a loan is involved, the bank will often only allow up to 1 year for the home to complete. After that the penalties start piling up. In addition, the interest on a construction loan continues to pile up until the job is done. Another “hidden cost” is that material and labor costs continue to rise over time. If you priced out electrical fixtures at $2000 and they end up costing $2500 by the time you buy them, that is money you did not plan on spending.

What does this mean for a would-be straw bale owner builder? My suggestion to those who are looking to save money is to be one of two things. The first is an “informed owner.” As an informed owner, the client is aware of the details of building a bale home and can walk the jobsite and identify wasted money and effort. By working with a contractor who is willing to support you in this role, you can save money on the job together.

Another option is to be an “owner baler.” Distinct from an owner builder, this type of client recognizes that the work of building an entire home is beyond their scope; however, running or hosting a bale-raising workshop is not. By installing all of the bales with free labor, or even laborers who paid to be there, the client can cut costs and still get a professionally built home. All the contractor has to do is give you the frame on time so that the bales can be installed on the posted dates. Your job is to do the same: deliver the home back to the contractor on time so he or she can continue to move forward in line with their critical path.

This is a new concept for owners and contractors alike, so it takes the right relationship and contract to allow these ideas to flow smoothly. It is possible and it is a better way to save money on a construction site.

Want to learn more about straw bale houses and how to build one? Want to do so for FREE? Sign up for our totally free 16 Day Straw Bale eCourse! Find out more HERE.

8 Responses

  1. I gone through the above article that you have given information about how to maintain home and about remodeling the home building we can help you by keeping aware from frauds by home.

  2. We are building a strawbale house in Indiana. We have an architect who is excited about about plans and designs. However, banks and lending institutions will not allow people to build their own homes. Can you recommend a builder in the Midwest area??? We also thought about doing a strawbale workshop with our house since this area lacks green building and awareness.

  3. I have recently watched your LB video, I have only one question for now: What type, gauge, size, etc. strapping do you recommend.

  4. We want to build a strawbale house in Western NY. The architect doesn’t seem to be a problem, however we need to find a contractor that has the capabilites to complete this in our area. There doesn’t seem to be many strawbale building contractors that advertise in our area. Any insight would be helpful.

  5. Hi Charlotte. Sorry for the long delay in getting back to you. I don’t know any bale builders in New York other than Clark Sanders, but I can’t remember where he is located. Perhaps a Google search for him will help you. Good luck.

  6. In case anyone uses the number for Joe Davis it’s actually 339, not 239. Website is buildwithnature.net. I’m looking into them and if I am able to build with straw I will update.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.