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Dan Nagy is the founder of Emmett Leo Homes, entrepreneur, investor, and a retired City of Winnipeg Firefighter. After a catastrophic, near career-ending injury, Dan focused his energy into creating a luxury building company that used all of his experience in building profitable luxury spec homes. Learn more about Dan in the link below.
#1 There is NO such thing as an Upgrade in a custom home.
An upgrade is moving up from a standard.
In a custom home, there is no standard. I have heard so many times that there are builders that are charging people on a custom homes for upgrade EVEN before they start to build.
A custom home is exactly that. Custom. You get to decide everything from the start.
The only thing that a good custom builder will be charging is any fees incurred AFTER the home has started, and you are changing you mind after you have already signed off on thing, and BEFORE it starts to affect the timeline.
#2 Spray Foam is NOT always a better option.
A lot of high end builders will push for the premium products because they are “seen” as a higher end product. Just because something is more expensive, does not make it a superior product.
The installation of a product matters.
Spray foam installed improperly is dangerous.Spray foam is great in certain applications, but is scientifically proven to NOT perform as well over a large wall.
#3 Tract builders make the highest amount of money off of their clients through change orders and upgrades.
So, maybe you are not quite ready to build a custom luxury home yet, and are looking at buying a home in a development from a larger tract builder.
What you will not ever be told is they are hoping that you change your mind after you have signed the papers.
This is because tract builders make their biggest margins on marking up “upgraded” items, as well as charging you a “change order” fee.
Tract builders have their costs down to the penny, and they know that if the client doesn’t change anything, they are making the bare minimum.
But if they can find someone that continuously changes their mind, or wants the full “upgrade” packages after signing off, they know that their profit margins will skyrocket.
#4 Air barrier is the key to efficiency, NOT special material.
Ok, so up here in Canada, the winters are cold. And the key to efficiency is keeping the warm air in and the cold air out.
So, obviously, the building industry sees that as an opportunity to come up with a bunch of fancy shmancy gadgets and gizmos to sell to their customers.
The tighter the house, and the more controlled the movement of keeping cold air out and warm air in, the more efficient a home can be.
Where a lot of issues come up is in the improper installation of products, and not making sure the the installers understand the importance of the installation.
You should be able to take a section drawing of your home, and from the ground up, put a pencil on the inside air barrier, and follow along all the way up and around the entire house until you get to the other side foundation without ever lifting the pencil.
Your Air barriers, either the clear plastic that is typically installed underneath the drywall, or other product such as spray foam, need to be installed properly and in the correct locations.
Once installed, a worthwhile expense would be a blower door test pre-drywall to ensure that the air barrier is installed properly.
#5 You do not NEED a realtor to build a home.
This is a blatant outright lie brought to you by your local realty board.
Don’t get me wrong, there are about 20% of the realtors out there that are worth their weight in gold and can help advise their clients very well getting into a home build..
However, there are a lot of people out there that think that you need a realtor for ANY and all real estate transactions.
That is false.
You don’t need their forms.
You don’t need their certifications.
A purchase contract can be done on a napkin at Starbucks and closed by your lawyer.
A great builder can help you through the build process because we know it inside and out. And so do the great realtors.
So, if you have a great realtor, they will tell you the truth, that you don’t legally need them, but they can guide you through the process.