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The Ultimate Guide on Contracting a Home

If you’re looking to contract a new home, you will need to know the entire contracting process!
If you’re looking to contract a new home, you will need to know the entire contracting process!

In this guide, we assume you are looking to become an Owner builder. If you are looking to hire a subcontractor instead, then this is still valuable information. Just know that when we use the word builder, then this applies to your subcontractor.

What You Need to Know about Contracting a Home!

A subcontractor can oversee much more than just building a home. Before contracting your house, you need to understand the overarching picture of the entire residential process. Will you go being clean or green, or not? So make sure you know all of the big ideas in this guide.

As you move through this guide, you can plug in your own information or think about your own situation as it relates to the points that we are discussing.

We’ll list the essential elements for contracting your home, so make sure to follow these elements in this order to build your home.
1. Perform a Financial Plan
2. Identify and Buy a Lot
3. Prep Your Big Plans and Specifications Lot and Land
4. Crunch the Numbers for a Cost Estimate
5. Look Through Your Construction Schedule
6. Inspect the Site
7. Sign Contracts and Secure Permits
8. Construction. It's time to build!
9. Inspect It the new home
10. Move Into Your New Home!
contracting a new home
Not too bad, right? These are big picture ideas, but you’ll also need to pay attention to and master the details.

We’ll take a brief look at all of these areas and help you to get started.

Perform a Financial Plan

To succeed with contracting your home, you need a financial plan. Since financial resources are limited, it’s essential to create a plan and stick to it.

First off, we begin with a budget - this is before even having plans made. Having a budget ensures you are building the home within your means. The budget gives you the ability to balance the costs of the land and the construction.

If you’ve already got a plan in place, then you need to figure out the budget next.

To have a budget, you need to first get a cost estimate. This will show you the estimated costs for your project and everything that is included down to each item!

Identify and Buy a Lot

Many people tend to already commit to a lot before even looking into planning, budgeting, and contracting a home.

But just know that’s a big mistake! Don’t worry, this is very common and can be fixable. I mean one out of every ten people have their homes built, so this has been done many times.

Most people tend to go by instincts on how much they can afford. People tend to pick a lot they love, in their desired area, and just run with it. Typically this can work out.

We encourage that you do the planning first when building your home.

Identify and Buy a Lot

The plans and specifications are going to be the documents that you work off of. They display exactly how the home will be built. Don’t be the type of person that is making plans as their building; otherwise, it can be disastrous.

There are so many choices to be made before you even build. For example, you have to think about the size, style (contemporary or cod), how about having a split or ranch? Also, think about whether you’d like a one-story or two-story.

Also, make sure you learn how to read a set of plans if you don’t know already.

As an owner, you’ll need to know all of the parts within a plan and what requirements are needed from the building department to be able to proceed.

When it comes to preparing your plans and specification, you need to be organized because it can be quite demanding.
new home contracting

Crunch the Numbers for a Cost Estimate

You need to create a list of all the possible material you need to contact your home. In addition, you need to find the labor or subcontractors that are required for making it all happen.

As the contractor or owner-builder, you have to work with suppliers as well as subcontractors for cost estimates. We will also go over the ways to find subcontractors and to inquire about their bids.

You also need to look for the necessary forms to deal with subcontractors and to organize all of the cost estimates.

Look Through Your Construction Schedule

The construction schedule is one where you can see a diagram of all of the sequential events in the construction process.

It will demonstrate how each event is related to each other and whether activities will overlap. For instance, it’s very likely that two or more events will go on at the same time for efficiency.

In this construction schedule, you’ll also find the duration of the schedule. Because of this, you can identify and schedule the delivery of materials and subcontractors. In this guide, we’re showing you two methods to do this: Bar Chart and the Critical Path Method. Either one will work wonders.

In case your financing hasn’t been secured yet, take your construction schedule with you. It will show your lender that you are taking this seriously and that you have a thorough understanding of all of the details laid out.

You may need third party software and forms to build out your own construction schedule.


If the financing still isn’t completed yet, you must finish it. This process isn’t an exact science. Some people can get an upfront firm commitment from their lender to pre-qualify and quickly receive their financing.

Other times, you may qualify for the financing, but wait for the budget and plans to be completed before following through with the funding. It may vary depending on the interest rates. But once you’ve found a good rate, you should commit as soon as you can.

If they are trending downwards, then you may wait until the last minute to commit.

Just make sure to speak with your lender!

You will also need to know all of the available permanent loan options and construction options. Know all of the required documents needed when applying for a loan.

Also, understand the formulas and things they are looking for when accepting people to qualify for a loan. Understand how to shop for financing so that you get the best loan option possible.

Permits and Contracts

Once you have everything, such as the financing, lot, and plans all set-up, now you’re ready to start the construction. Now all the hard work is paying off.

Firstly, you need to begin the contracts with the subcontractors that you have decided to work with and make sure you have all of the building permits necessary.


The general contractor will oversee the person to direct and conduct everything that’s going on.

What You Control

Schedule - As the contractor, you need to ensure that your subcontractors come to work on time.

Purchase - Make sure you buy all of the materials you need for this project.

Cost - Make sure that your team is efficient by minimizing the theft and waste of materials. You need to also frequently check the expenses such as financial admin, accounting, and have all the documentation ready.

Accounting - You need to keep up with the costs and stick to the budget that you set out earlier.

Oversee the Construction - You must get the subcontractors going, help them with any questions, troubleshoot issues, call for inspections, as well as check for quality and accuracy.

High Standards - make sure you have a standard of accepting high-quality craftsmanship and quality of work. This is your call to judge both the subcontractor's work and supplier’s materials.

Let Go - you need to let go of the unnecessary things that can hold you down. This is knowing what to accept and let go of bad workers, bad suppliers, or things that waste your time.

Although, there isn’t every little detail in this guide, we think we’ve covered the basics. Now you have a feel of the most important things to focus on for contracting your home.

Moving forward: You should comprehend all the parts of your home, so you’re prepared for the next phase, the construction phase.
Let's dive in!

Experts in Contracting a Home

Below, you'll see important features involved when contracting a home. Make sure to give special attention to these extremely important avenues when it comes to contracting a new home.
contracting a home