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Hello, my spouse and I are building a home in the western burbs.
It is currently under construction. The purchase price in the contract was 740K. We paid him a check for 9K extra for some more things to be done. Was going to be 15k, he gave us a 6K break in price at time of negotiating.
Now allowances. Compared to those building in the western burbs, homes between 700-1mil all the other contracts have much higher allowances, esp on cabinets. Here is a breakdown
Front door - 2,000
Lighting/electrical fixtures 2,000
appliances - 8,000
cabinets and vanities - 10,000
stone 5 ton , 300/ton allowance
carpet -25 per square yard
tile material 3 per square foot
landscaping and sod - 5,000
Fireplace - 2K
Counterops -7,000
Front porch up to 150SQFT
So the big one we knew was super low is the cabinetry. We checked out all referrals and they were happy with the builder and they were all quality homes. He said he would not be the cheapest, but would not cut corners. Now included in our contract outside of other builders is that he paid the 10K architect fees, all ther permit and survey that we were to pay for others that would be anotehr 10K Whave 3200 sqft with 9 foot celings on basement, 1st floor, 2nd floor 8 3 large bedrooms all with walk in closet and full bath coffered ceiling in family French doors going to office Hardwood floors included in house, except bedrooms molding all downstairs Three car garage, front porch Fireplace is prefab The cabinetry, lighting/electrical is just really making us feel bad. Feel awkward bringing it up to him and the contract is a contract. Just trying to feel good about the purchase. Anyone see good in the contract?
I guess we just have to look a the facts that we did get a break on out of pocket fees like architecure, permits, et.
compared with other homes allowances are pretty much in line minus a thousand or so outside of cabinetry which we just dont gt.
If the allowances are low- either you choose cheaper stuff or you pony up more money. Will you be happy with what these allowances will buy? Will you end up picking nicer stuff and paying extra?
I am not sure where the "western burbs" are, but a $700+k house is likely on the high end in most markets. So, I would not expect you are looking at builder grade materials. I just remodeled my very small kitchen in an expensive area and your allowances for appliances, countertops, and cabinets are all low. And I was just doing a kitchen, not bathrooms, as well.
The "allowance" is a placeholder number to actually be able to compare GC bids "apples to apples". Your actual specific selections determine what you are paying; but those numbers reflect a low range of materials/ appliances for a house that is no larger than 1500 SF, IMO.
The "allowance" is a placeholder number to actually be able to compare GC bids "apples to apples".
Exactly! If you want a more accurate estimate of the final cost, you need to specify all of these items up front.
When you're working with contract allowances, you have full control of how they're spent by the choices you make. Using countertops as an example (say 100 sf), you can pick material that costs $30/sf or $100/sf. The first one reduces the bottom line by $4000, the latter adds $3000 to the total. There should also be a clear understanding if the allowances are strictly for material costs. Basic installation should be included in the contract, but some allowance item choices could also have a labor premium.
And I also agree that you're likely to blow through all those allowances with no trouble at all. Plan on having some contingency money set aside to cover the overages.
The western suburbs of where? I immediately think of the western suburbs of Chicago because that is my reference point, but it could be any place in the U.S.
For reference I paid $15,000 for new granite countertops 18 months ago in southern IN. It was more than the average sq. ft. The island alone is about 12 x 4 ft. The counters are are about 20 x a lot.
Lighting_what does the 2K include? When we built out house we budgeted about 7K for all non-recessed lighting fixtures. We had a really good idea of cost since we'd built 6 years earlier. The 7K was assuming a 50% discount on the list price of fixtures.
Thanks, will add clairty, Western burbs of Chicago.
130 a square foot. 3200 + square feet is our home, can lights included as well as all installation for lights.
Front Door budget is not bad, appliance budget is a few thousand less than others, quartz is in line with other people we know in western burbs. Tile and carpet just a little lower.
At time I did the math and 10K cabinetry I knew was small, but as I mentioned our builder paid the archetincure fees and permits. Other builders did not. That probably added 15K-20K so in reality it is kind of break even. Most people we know cabinet allowance is 20-25K. All go over as others have said.
Just curious other thoughts. That is all. Thank you.
$130 sq ft is WAY, WAY low for a decent house. You need to get closer to $200 to get decent stuff.
What does your contract say?
Sounds like you bought a "fixed price" house, with a couple of "budgets (which are way low) for you to "select" a few things like cabinets, appliances, bath fixtures, etc. Judging from the allowances he gave you the stuff he budgeted is junk and you need to pay up to get decent stuff. BUT, do you want to put higher end fixtures into a crappy shell?
Unless your contract lists everything which will go into your house (and it should), then you have left it up to your builder, and he is going to maximize profit. YOU should know every nail, every board, every shingle, every fastener, every knob and handle, furnace/air conditioner, and on and on which is going into your house. Make, model, etc. so you knw what you are getting. Otherwise, you are getting builder grade stuff. Ten year life.
And BTW, you should typically budget a minimum of 10% of the project for overages, upgrades, etc. They creep in by the 10's and 20's...thousands !!!
$130 sq ft is WAY, WAY low for a decent house. You need to get closer to $200 to get decent stuff.
What does your contract say?
Sounds like you bought a "fixed price" house, with a couple of "budgets (which are way low) for you to "select" a few things like cabinets, appliances, bath fixtures, etc. Judging from the allowances he gave you the stuff he budgeted is junk and you need to pay up to get decent stuff. BUT, do you want to put higher end fixtures into a crappy shell?
Unless your contract lists everything which will go into your house (and it should), then you have left it up to your builder, and he is going to maximize profit. YOU should know every nail, every board, every shingle, every fastener, every knob and handle, furnace/air conditioner, and on and on which is going into your house. Make, model, etc. so you knw what you are getting. Otherwise, you are getting builder grade stuff. Ten year life.
And BTW, you should typically budget a minimum of 10% of the project for overages, upgrades, etc. They creep in by the 10's and 20's...thousands !!!
So I want to pay more per square foot? We have gone to every home he has built and they are all quality. Some living in 12 years.
We know allowances low, contract does lay out. Crappy shell? I dont think so. Getting off this site. Thanks for the replies though, I think.
Never mind I was wrong, excess square footage would be 130 a square foot. 740K price, 3200 square feet, that = 224 a square foot.
Again, he is about all quality. Said low on allowances upfront, like I said with we got 25K of fees waived so it evens out.
Problem is COVID has hurt my business subsatially. Did everything right, saved, budgeded. My income was cut from 400K to 100K this year.
So 20K+ on cabinetry out of my pocket would have been nothing pre covid. Now different.
Dont know if he can work with us or not.
Also have medical bills, lots of kids, etc. on why budgeting so important. Dont know if anyway he could work with us on cabientry. Might not.
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