Additions, Remodels and Custom Homes – The 5 Phases of The Design Process

Best Practices in architecture and construction manage a project under five phases that we will review here.  All projects, whether a $5,000 bathroom remodel or a $5 billion dollar stadium have these five phases.

The phases are defined as:

Phase 1 – Program Development: Defining what your goals are, what you want to do, what is in budget and what you are allowed to get permitted by the city or county.

Phase 2 – Schematic Design: The design of the floor plan, layout, exterior drawings called “elevations”

Phase 3 – Design Development: The selection of heating and cooling systems as well as interior design elements such as appliances, materials, furniture, paint etc…

Phase 4 – Construction Documents: The technical “blue prints” and engineering that is needed to get a building permit and build the home.

Phase 5 Construction: Getting bids, hiring a contractor and building the home.

Architecture is critical in all 5 phases.  We usually introduce a contractor at Phase II, Schematic Design as they can provide an estimate at that time.

Design is not a perfect march forward. There will be back and forth and changes to designs and specs all the way through the completion of construction.

 

 

 

The Right Way to Start a Project: How New Avenue seamlessly brings together owners and architects to start a remodel, addition or new home

At New Avenue, we make it as easy as possible to start your project right.

We have found that just one meeting in your home with an architect is the perfect way to begin.  Architects see things in minutes that many of us will never see!  Design talent, matched with countless hours in a studio during college and thousands of hours more studying other homes in your community makes a difference.

You can get free visits from architects and contractors. They will come by and give you a sales pitch by trying to impress you with their past work while not giving you new design work for free.  We save you time by charging a small fee to justify making the first meeting a working meeting. We don’t make a sales pitch in your home, we come ready to work for you.

Here are our first steps in the New Avenue process. We recommend you follow this process matter who you consider working with:

Step 1: Owners fill out a Goals & Ideas questionnaire on New Avenue.  These questions are based on our experience with thousands of clients and architects and they are designed to get owners thinking about the right

Step 2: Set up a call with New Avenue project manager to discuss the goals & ideas and the New Avenue process. You can tell us a time to call you here.

Step 3: Sign up for a $250 in-home design session. You can sign up on the New Avenue site here.

In this meeting an experienced architect will listen to your goals, share their design ideas, and review zoning and building codes.

We commit to having an architect follow up within a day and we can meet with you within a week.

Step 4: The architect will introduce themselves using your project page.  Here is an example of an introduction:

Hello Rachel & Laura, My name is David. I am a New Avenue partner architect. Your project sounds really exciting! I would like to suggest that we meet at your property so that we can meet, look over the home and discuss your options for design and development. Are you available in the early evening sometime next week? At the moment Tuesday, Wednesday, and Thursday evenings are open for me. Do one of those dates work for you? David
Another architect said this:
My name is Brad. I’m an Architect with New Avenue. Your project sounds very exciting and I’d love to meet you at your property to hear more about your vision. Do you have any availability to meet next Wednesday between 11AM and 1PM or the following Tuesday also between 11AM and 1PM? I look forward to meeting you.
These messages are posted in a private message on your project timeline
Private Message on Timeline
Step 5: After the meeting you’ll receive a detailed Design Proposal that will list every step in the project, the hours and cost for each step. You can click approve to hire the architect and we automatically provide a design agreement the delivers the industry’s best practices in design, permitting and construction administration.

Trust us! Seriously. Use These 3 Essential & Free Tools Every Addition, Remodel or Custom Home Needs: A Design Agreement, Construction Agreement and Budget

If you are planning an addition, remodel, or custom home then save this message.  Seriously. Save it and use these three documents.

This is the most important article we can share with you.

Communication is always stressful and challenging.  Every remodel or new construction project has questions that need to be answered or changes that an owner, inspector, architect or contractor want to make. Some of these changes are great improvements, some are in response to discoveries, some are just part of the creative process (picking, kitchen pulls, paint colors etc…)

Anyone who promises not to make mistakes and not to have changes is over-promising. Sometimes over-promising is caused by optimism and enthusiasm while other times people may just outright lie to you.

Every project needs a Design Agreement, Construction Agreement and Budget. These three documents help the owner, architect and contractor communicate expectations.  That’s it.  That’s the goal!

Owners, architects and contractors use New Avenue’s innovative system to manage projects that cost between $50,000 to over $2,000,000.  Current projects are located from California to New York.  Our software system collects insights throughout the design, permitting and construction process. In one year we see more transactions, proposals, and changes than most most architects and contractors see in a lifetime.   We incorporate those lessons in the industry’s best agreements and budgets and we provide these to you for free.

We are genuinely afraid of any project that does not have a clear agreement and budget in place.  In fact, we won’t work with anyone who doesn’t want to use these.  Without this expectations are guaranteed to be wrong.  We recommend that every project use these three agreements to set the right expectations and establish a healthy working relationship:

New Avenue Construction Agreement

New Avenue Design Agreement

New Avenue Example Budget Format For $100,000 – $5,000,000

Project are easier to manage, more efficient, and more affordable when the team has a clear understanding of the work to do.

  • This saves you time and headaches.
  • When you save the architect time, you save money.
  • When you save the contractor time you save money.
  • When mistakes go down the owner, architect and contractor will have fewer mistakes and this improves quality.

Everyone is happier as a result!

Following the guidelines set forth in these agreements requires discipline and the New Avenue project management system makes that part easy.

You can sign up and use the New Avenue system for free here: Get Started

9 Construction Communication Gaps – How to Talk to a Contractor

Construction lingo can lead to confusion before your job even begins. This often creates cost overruns and frustration.

This article tells you what to look for in a construction bid so you can avoid surprises.

Anywhere you see something you don’t understand you should expect to be surprised by a cost that you didn’t anticipate. If you don’t know an acronym or brand name or word in the bid, just ask. That’s the goal of reviewing the bid with a contractor.

Here are 9 common communication issues that can cause you pain that is easily avoided:

Allowance: This is a dollar value that a contractor has noted for something in your project.  For example, your allowance for your bathroom tile is $2,000.00.  If the cost of the tile goes up or down then you pay or save the difference.   A large number of allowances means that the contractor is shifting the responsibility of getting certain products for a specified price to you.    Be careful of more than 5 allowances in any bid and make sure you know how to buy something for the allowance price noted.   Often times an allowance for windows is just a small fraction of the windows that you probably want to buy.

OPCI:  Owner Provided Contractor Installed.  You will be paying for these products and storing them on site for the contractor to install.   The contractor is responsible for installation costs. This can be a great way to save money, but you certainly want to be aware of what you have to buy. If you buy the wrong thing or too little then the contractor is justified in charging you hourly to go out shopping for you.

PBO: Purchased by Owner.  This is the same as OPCI.

NIC: Not in Contract.  This is work that the contractor is not responsible for.  You will have to accept a change order and pay additional money to get this work completed

By Owner: This is the same as NIC.  You are responsible for all materials and labor to complete this work.

TBD:  To Be Determined.  There will invariably be something needed that costs you money.  TBD should rarely if ever be part of a construction bid.  The point of a contractor is to eliminate TBD.

Verify in Field or VIF: Danger!  The contractor will verify if some work needs to be completed after he or she starts and it will then be your responsibility to pay for it.  It’s better to pay them hourly to remove any VIF conditions before you sign a contract and before they start work.  Be very clear that the site slope, soil conditions, plumbing, underground utilities, electrical are all included in the bid.  We’ve heard contractors complain that the dirt was heavier than they expected.  While possibly true, it’s their job to deal with that.

Existing Condition: The current condition of anything such as underground utilities, underground rock/soil issues, mold, asbestos, dry rot.  These should almost all be determined prior to accepting a bid.   For example many roofers will say that dry rot (which is a visible fungus) is an existing condition and is not part of their bid but they could easily look at rafters from outside and see that dry rot is an issue.

 T&M: Time and Materials.  The contractor will work by the hour and will bill you for their hours plus their materials and then will typically mark it all up by 15%.  This puts all the risk on you as the customer and gives them an incentive to take their sweet time while running up both labor and material charges.   There’s no reason to use T&M for anything other than a small job that takes just a few days.

Sign up to see example budgets, example floor plans, or to use the New Avenue system for free here: Get Started

 

 

 

 

How Long To Build a Custom Home or Remodel a Home

We reviewed all of our completed projects and found the following timeframe for construction:

  • The maximum construction time was 13 months
  • The fastest build was four months (this was during the 2010 recession and everyone was ready to work at a moment’s notice) 
  • The average time to build a project is 8 months.

This includes projects that cost between $100,000 and $500,000. 

Screen Shot 2016-10-21 at 9.55.16 AM

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18 Common Budget Busting Construction “Change Orders” That Occur During Additions, Remodels and New Construction

The New Avenue online project management system reviews hundreds of projects at any given time.  We track all of the change orders submitted by contractors in these projects.

This post highlights the 18 most common change orders.  These are changes that may be called “surprises” on your project and often times they shouldn’t be surprises at all.  You should be planning on these changes.

You can review this checklist and check if your project budget includes them.  Do this and you can be prepared to review any bid.   You can make sure the full scope of work is included in the price you are quoted.

First, a note on what a “Change Order” is.”Change Ordering” is a verb used in the construction industry and it’s something that many owners are completely unaware of.  One of the unfortunate facts of many remodels is blown budgets. One cause of this is that unscrupulous contractors use change orders in a strategic and deceitful way to offer low bids.  They then make your project a miserable experience as they introduce additional hidden costs.  Some (and certainly not all) contractors make all of their profit off of these “Change Orders”.  This is true for projects ranging from small $1,000 projects to billion dollar bridges.  The good news is that many contractors have noble motivations.  They became contractors because they want to build beautiful homes – and they want you to be happy.  Even a perfect project can have 20+ change orders that you willingly choose to make.   In fact, you can have 20 or more change orders and still complete the work on budget.  With a well prepared bid the changes can be fun ways to add things that you love. Use this list to improve your next or only remodeling experience.

In our review, 13 of the 18 most expensive change orders were “discretionary”.  Discretionary change orders are changes the customer asked for. This was not part of the original bid.  It is an add that the customer requested. We consider those good change orders. They often pop up as a project is progressing on budget and the customer had a little reserve money socked away and they decided to add something nice.

However, five of these change orders were “non-discretionary”. These are the unpleasant changes. These changes are difficult to manage because sometimes the cause is beyond the owner’s or builder’s control. A building inspector may exercise their authority and request something that is not in the plan or the budget. In this case disagreeing with the inspector is an issue of fighting City Hall.  From what we have seen, City Hall never loses that battle. Other times, a designer, engineer or contractor overlooked something. Again, in a complex project this if common and a little leeway is fair.  But if this happens too often then it becomes a real question of competence or even integrity. This varies wildly by professional and most professionals are very fair and honest. However the bad apples are also very good at figuring out how to get you. It might be that you didn’t read the plans or it may be that you love custom woodwork… or both.

A well run project will stay within 10% of the bid.  If an invoice is 25%, 50% or even 100% over budget then you should tell your contractor these two things: 1) “I’m paying what was in the bid, I’m sure you can make it up on the rest of the project” or 2) “I’m canceling the contract and going back to bid with different contractors”.

Here is the list of top 18 Change Orders. This list is from all of the projects reviewed not just one project! The average of 8% increase from the original construction bid to the final completed project cost with the 8% split evenly between discretionary and non discretionary changes.

1-13 Discretionary Change Orders: 

1) Add a new bay window to the home.  Since windows were being added in the addition, it made sense to add a bay window to the existing living room at the same time.  Amount: $5,684

2) Upgrade window quality Marvin windows and Velux skylights.  Amount: $4,086

3) Landscaping:  Install a fenced in trash area and stone flatwork in the yard. Amount: $3,393

4) Add a gas line to a backyard cottage to upgrade from electric stove to gas:  $3,000

5) Change siding from Hardi board concrete to wood board and batten.  Amount: $2,325

6) Add tile to main home entry stoop.  Amount: $1,880

7) Add crown molding to living room and kitchen.  Amount: $1,761

8) Install a new skylight in a loft.  Amount: $1,487

9) Additional tile wainscoting in bathroom and tile nook in shower.  Amount: $1,050

10) Change from stained concrete floor to tile floor throughout 610 square foot space.  Amount: $1,050

11) Add false wood beams to living room.  Amount: $996

12) Addition of extra lighting fixtures throughout house.  Amount: $835

13) Provide and install 8’x4′ fence and lattice made of redwood for trash cans.  Amount: $771

Non Discretionary: 

14)  Foundation improvement: Excavate an additional two feet for foundation improvements, fill with compacted gravel, additional concrete.  Amount: $6,042

15) Fire proofing of laundry room.  Amount: $2,151

16) New water line from the street to the main home in order to increase capacity for fire sprinklers. Amount $5,505

17) Add fire sprinklers due to a new building code requirements. Amount $4,360

18) Replace electrical panel in main home with a new 200 amp service, including a wire from the street, new panel and all breakers.  Amount $3,272

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Speed, Quality or Money: Be Wary of Fast Growing Websites That Are Overrun by Shady Contractors

NBC just investigated a contractor matching service and found that 60% of the contractors providing bids are unlicensed. Many ripped off clients by running away with the deposit money or not completing the work.  At New Avenue we are not surprised. We built a project management system the eliminates the risk of these scams happening.  Then we recruited a network of architects and builders who we can trust. We work with our partners for years to create efficient processes and verify that the trust we put in our architects and contractors is well placed.

Matchmaking sites don’t help with the significant risks of quality, licensing and payments.  New Avenue protects owners from all three of those risks.  The nightmares and theft noted in this piece by NBC won’t happen on New Avenue.

These three lessons are critical to remember:

  1. If you focus on speed you sacrifice quality
  2. If you focus on large numbers of vendors you lose the personal standards of licensing, insurance, and integrity.
  3. If you focus on just matching people you overlook managing the project and managing payments and people get ripped off.

New Avenue makes all three of these risks go away.  We replace them with a quality experience, proven contractors we’ve learned to trust over years, and a payment processing platform that makes sure you only pay for the work after it is done.

http://www.nbcbayarea.com/news/local/Popular-Website-Allows-Unlicensed-Contractor-to-Solicit-Business-423198104.html?_osource=SocialFlowFB_BAYBrand

The reporters sum it up well.  Take your time, check their license and by law contractors can only charge up to $1,000 or 10% of the total job up front. The rest is paid as the work is completed.

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Top 3 Challenges in Remodeling or Building New: Clarity, Knowledge and People

Clarity, Knowledge, People!
That’s all you need.
New Avenue helps you get all three.
There are three key problems facing every owner who is remodeling or building new:
1) Clarity: It is really hard and time consuming to figure out how to interview, hire, manage and pay an architect or contractor.  You’re basically trying to assess what someone else is thinking, and measure the quality of a design (which is subjective) and that design hasn’t been created yet (i.e., designed)?  Oh my.  Good luck!
2) Knowledge:  The design and construction industry does not share accurate or comprehensive pricing.  It’s partly cultural.  It’s partly because of point #1.  How can you tell someone what something that isn’t even designed yet will cost? You’re best bet has always been to prepare yourself for your project to “Take twice as long and cost twice as much”
3) People: It’s hard to find good people and it’s even harder to trust a good person when you find them.
New Avenue has spent eight years solving these problems, and our system is free to use.
Problem #1: Don’t have years of experience managing architects and contractors?  That’s ok. Nobody does.  Don’t have the time to find, interview, hire, manage and pay them. If you had that kind of time, you might as well DIY.
Solution #1: Our Owner Toolbox makes it easy for you to find, interview, hire, manage and pay your architect and contractor. This system is free to use. It brings clarity to your project, from start to finish.   Clarity reduces confusion, stress and mistakes – and saves our owners 10% or more.  Get a competing bid, and we’ll prove it!
Problem #2: No one knows what things really cost.  Architects and contractors only know their part of a project. Plus creating a new home is really really hard.  It is a bit like raising a child, if you’re honest with yourself, there’s a good chance you’ll have one, maybe two, and then you’ll stop.
Solution #2: New Avenue save the data from completed projects and shares this with you so you know what to expect and you know when you’re getting a fair price.  You can’t get this anywhere else.
Problem #3: It’s hard to find a good architect or contractor. Then you have to figure out how to interview them and figure out if they are right for you.  This takes so much time, and it’s not even effective.
Solution #3:  New Avenue interviewed thousands of architects and contractors, recruited the best and worked with them for years to build up an actual database that proves they do quality work, stay on budget and have happy clients.
Sign up to see example budgets, example floor plans, or to use the New Avenue system for free here: Get Started

5 things you might find in a new $1,000,000 home

We recently bid a 3,000 square foot custom home in the heart of Silicon Valley.  I grew up in a 1910 Sears Catalog home that would sell for $180,000 today.  $1,000,000 is an insane amount of money. Except it’s quite common today.
At $333 per square foot I have to admit, I was surprised this wasn’t more expensive…
Because this home is in the most expensive real estate market in the country. People can spend $1,000+ per square foot in this town.
Because it is designed with magazine quality, fantasy finishes.
So, let’s see what kind of goodies techies drop their money on:)
These are the five big purchases that I find most interesting:
– Fancy staircase
– Special cut hardwood flooring
– 4 exquisite bathrooms (in a three bedroom home)
– Custom kitchen cabinets
– A 10 piece wall of windows and sliding doors.
Here are some details about these finishes:
–  A special order $38,000 staircase.  This is the kind you’ll see in Dwell Magazine.  The staircase has floating wooden steps, a structural steel stringer, steel supports, and a metal wire railing.
Inline image 2
– 35,000 hardwood flooring that is “rift sawn”.  Rift sawn is the most expensive way to harvest wood from a tree trunk, it’s also the hardest and most durable.
Inline image 3
Rift Sawn
– $5,600 in glass shower doors, tile everywhere, waterproof floors throughout.
– $36,000 in custom kitchen cabinets

– 10 part glass doors running the full length of the kitchen and living area.  A truly open living area like this, in earthquake country, with another story above requires that you build the walls like building a steel skyscraper vs. a traditional wood framed house.
Inline image 4
To see some of the design of this home, and the full budget, you can read another post here.
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Cost of a custom home in Silicon Valley

We recently completed a bid for a 2,886 square foot custom home in Los Altos, CA.  This is the heart of Silicon Valley.

This is a just under $1,000,000 for just under 3,000 square feet.  That budget does not include the architecture, engineering and permitting which can be another $250,000.

You can review the full bid 2886 Los Altos Bid

The home was a small ranch home that is being torn down and rebuilt as a 3-bed, 4-bath plus an office.

An elevation, or the exterior view of the home:

Los Altos Elevation

An elevation of the front of the home: Los Altos Elevation 2

The first floor plan:

Los Altos Ground Floor Jpeg

The second floor master bedroom, master bath and office:

Second Floor Master Suite

A quick rendering to get a sense of the size and look – details are intentionally left out of this:

2,886 Square Foot Los Altos Home

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