Your builder is your guide for construction and your lender should be your guide for financing. No matter how beautiful the home, no one enjoys living in a home that they really can’t afford. So, it is important to be upfront and candid with your lender about your financial goals, down payment, cash available, monthly payment, etc. No matter how much money you make, building within your means ensures that all the costs are considered before you begin the journey.
In a previous article, we discussed the importance of having the builder involved in the design process to ensure that your budget and vision are aligned. But, even after you have your concepts on paper, there are still a number of decisions that must be made and all of these decisions can impact your budget, your financing, and your monthly payment. Depending on your financial situation, it’s important to ensure this part of the process doesn’t run away from you.
Let’s look at a story that exemplifies “building within your means” perfectly. Have you ever gone to buy a car? You decide on the type or model and a general budget – let’s say $50,000. You do some research on the web and determine that $50,000 is a reasonable budget for your needs. You then venture out to the local dealers to drive and compare. Upon arrival, you notice that many of the cars on the lot have upgrades and features you had not originally considered. After driving the car, you decide to add a few options for an additional $10,000. After all, if you’re going to spend $50,000 on a car, you want all of the bells and whistles! Suddenly, you realize that you’ve added 20% to your initial budget, bringing the cost of the vehicle to $60,000 + taxes, title & tags. This amount puts the car well beyond your budget and perhaps even “your means.”
This same type of ‘building within your means’ story happens when we begin the home building process, sometimes exponentially. You want to maximize the features and benefits of your dream home but the options and selections start to take on a life (and budget) of their own. Often, a homeowner gets so excited that they say, “Well, we are only building our dream home once, and we really want to have this or that.” This can lead to a scope of work that quickly slides into ‘beyond your means’ and that is a situation that neither you or your builder desire.
Your builder’s job is to ensure that your home can be completed for the budget you’ve provided. This requires some honest conversations during the process, about the changes you request, and how they will be paid for. We believe it’s important to be clear about your budget, and as discussed earlier, leave yourself a bit of ‘wiggle room’ for the upgrades and unexpected expenses that will no doubt occur during the construction process.
Most importantly, you want to build a home that you feel good about walking into every day. That is the real goal of ‘building within your means.’ You may be able to afford a larger, more luxurious home, but will you be able to sustain that expense over the next thirty years? It will help to be comfortable with the financial aspects of the building process. You do not want to complicate the process or compromise your overall experience, with a home that is beyond your means.
If you are thinking about building your once-in-a-lifetime custom luxury home, be sure to download our FREE ebook: “Designing & Building Your Custom Dream Home: How to Create an Experience You’ll Love to Remember.” Ready to get started? Contact Mueller Homes today, and let’s talk!
