Stimulation

Two things about this are turning out to be way more expensive than I had initially thought. The first is architecture. To have a good architect design us something that will really be a modern gem, it is going to cost in the range of 8% to 10% of the construction budget. Because of my experience in commercial development, I had 6% in mind, but those are much bigger construction budgets, so 6% goes a little further. I can see how a there is probably a lot more fine detail that goes into building a small, compact home, rather than a vanilla shell retail structure. If we wanted to go have a stock home plan converted to our site, it would cost a fraction of an architect, but if we did that, what would be the point in building a house ourselves? Might as well move to a subdivision and steal a house from a bankrupt home builder. We really will have budget constraints though, so we will have to negotiate with the architect the best we can. We feel like we perhaps are a little more prepared with knowing what we want and what is realistic than the average consumer. I have been researching this so long and my every day business does put me a little more in the know, so hopefully that will result in making the job just a little bit easier for the architect.

The second thing that is going to cost more than I had initially thought are all the costs associated with financing. I had never really tried to put a number on it, but I had a number in my mind that was about half to two/thirds what it will actually cost. In the end, we will probably spend as much in costs associated with financing (origination fees, title insurance, escrow fees, appraisals and course of construction interest) as we will spend on architecture. Here's hoping that construction interest and origination points are something that I get to deduct on my taxes. The origination fees should at least count.

I need to figure out a way to get some sort of tax credit or something from the stimulus package. Building a home in this market, there ought to be some sort of gold star from the government. We're just doing our best to turn the wheels of the economy ever so slightly. If we build this house the following economies will be stimulated: loan officer, title officer, appraiser, architect, engineer, general contractor, various sub-contractors, sales reps for various building material suppliers. City planners and inspectors will have something to do. The city will get to collect impact fees and permit fees. The utility companies will get to have a new customer and someone will be employed to make the utility connections. I think someone gets our first born too

So, anyway, all I'm asking is that President Obama call us himself and tell us how grateful he is. That, and no taxes in 2009.