As construction moves forward, the focus shifts from the exterior to the interior, making it harder to track progress from the outside. However, there’s still important work ahead. Tasks like leveling the surrounding area and ensuring proper grading away from the house are crucial. We’re also working on finishing the driveway and utility systems. We completed a significant portion of the septic work when we built the barn to service the RV. Now that the tank is in place at the house and all the connecting lines are ready, we can move forward and meet the requirements for a construction loan advance.
Managing schedules in construction is no easy task, and unexpected delays can throw a wrench into our plans. For instance, the drywall company’s project manager made an error with the delivery date, which could have caused a month-long setback due to their supplier’s prior commitments. To avoid this, the company owner took charge, starting the project earlier than planned and sourcing materials from an alternative supplier, ensuring they arrived the next day and preventing a three-week delay.
A similar situation unfolded with the hardwood flooring subcontractor. Missed deliveries and delays occurred due to a lack of follow-up by the buyer. To resolve this, they secured a better flooring supplier and opted for a higher-quality hardwood, which was transported from Minnesota to Indianapolis LTL, and from Indianapolis to the site by the owner the next day. This saved all but one week of a potential four-week delay.
As the hardwood flooring adapts to the climate-controlled environment inside the house, the cabinet maker and trim supplier now have stain color samples, resolving two major concerns and preventing two possible issues.
However, construction often comes with unforeseen challenges. For example, tile installation took longer than expected due to the complexity of the walk-through shower. Additionally, we had to address issues caused by improper gaps during underlayment installation, which occurred due to moisture exposure before the structure was dried in. The flooring contractor had to hand-plane the seams to ensure they were level, adding several days to the timeline and impacting the builder’s profit margin.
With major systems like electrical, plumbing, HVAC, and septic nearly complete but not yet fully finalized, cash flow management becomes a significant concern. Construction loans require inspections before releasing funds, with credits assigned based on completion percentages for each system. However, these standardized percentages may not align with the progress of a custom home. For example, a 4% credit for a fireplace, which our home doesn’t have, can reduce available credits until the project reaches 100% completion. This means we need to be prepared to cover various costs out of pocket, as contractors often require deposits and progress payments that may not align with the inspector’s credit system. This can range from a few thousand dollars to well over $100,000, depending on the contractors involved. In cases like ours, where the schedule resembles off-site production more than custom home building, significant cash outlays are necessary to keep things on track.
Next month:
Dealing with communication issues