Homebuilding 101: The Ultimate Guide to Planning and Building Your Dream Home

Marwa Hasan
Written by Marwa Hasan
Reviewed by Robert Tschudi
Updated January 26, 2022
A home exterior in evening
Photo: Bmak / Adobe Stock

Highlights

  • Sourcing land can be easy once you pinpoint size, zoning laws, and the location.

  • Hiring a good contractor experienced with the type of home you want to build is key.

  • Floor plans will determine your permitting needs.

  • Obtaining a building permit is essential before starting the construction process.

  • There are many different types of insulations you’ll need to consider.

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Have you heard? The details and choices of building your dream home don’t have to be stressful. Actually, building your home can be one of the most rewarding things you do in life. Before starting your home building journey, you need a plan—from sourcing land to insulating your house. After all, this is your chance to build a home that you’ll enjoy for years to come.

Tips for Finding Land To Build a Home

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Building a home is a dream for many, but you need to buy land before hiring a contractor. Here’s what you need to consider in your plot.

The Lot Size

How big do you want your home to be? Do you want acreage? A garage? Space for a garden, or a playground for your kids? Answering these questions will help you determine how much land you need to buy.

City vs. Countryside

Buying land within the city limit means restrictions on the size, type, and design of the house you can build on. The farther you venture from the city, the cheaper land becomes. Once out of the city, you will often have to provide your own water source (well) and waste disposal (septic tank and field). You’ll also typically find cleaner air, bigger lands, and more freedom to build a custom home.

Zoning

Ensure your land is zoned properly before you make an offer. Check with the local authority or homeowners association (HOA) for any potential restrictions or pitfalls, such as ordinances restricting owners to build on a percentage of land only. 

“We look very carefully at every plot of land that we consider buying,” says Bob Tschudi, Angi Expert Review Board member and general contractor in Raleigh, NC. “Not all land is buildable, and not all land outside of city limits can support a septic system for the size house you want.”

Property Taxes

Property taxes are an important thing to consider when budgeting for your home building journey. If you’re working with a real estate professional, ask them about property tax rates in the area, since they vary depending on the state and the property value.

Tips for Finding the Right Building Contractor

You got the land. Now, the fun part begins. But you’ll need to find the right building contractor to make your visions of kitchen island layouts and bedroom and bonus room ideas come to life

Choosing the right contractor guarantees that the construction process will go smoothly and as planned. It’s not worth it to hire a builder who won’t deliver. The type of home you want will help narrow down your contractor choices. If you buy land in a preplanned neighborhood, they might have contractor recommendations for you.

  1. Spec: Houses that are built in a new community by big companies

  2. Tract: Identical homes in a neighborhood built by large contractors that cost less than custom homes

  3. Custom: A built-from-scratch option. You choose everything from the floor plan to the tiles in your bathroom. An experienced contractor is a must.

Don’t Go for the Lowest Price

A lower price doesn’t equal a better contractor. Low bids, fast timelines, and steep discounts are often red flags. Choose a reputable contractor you can trust, even if it means spending more money.

Get Recommendations

Ask friends, family, neighbors who have experience working with licensed builders. Read reviews about local contractors in your area, and make a list of the potential builders.

Interview Several Contractors

Pick at least three contractors to meet in person to discuss their qualifications, the types of projects they tackle, references, and what to expect from their quotes. Prepare a list of questions. A contractor should answer any question you have enough to make you feel comfortable.

Check Licensing 

Browse your state’s consumer protection agency before hiring a contractor to ensure they don’t have any history of disputes. The Angi licensing tool will help you determine if your contractor really carries the right license for your build?

Do They Have General Liability Insurance?

General liability insurance protects against third-party injuries and third-party property damage. 

If they don’t have insurance, you’re on the hook if your builder won’t provide coverage in case of any damage.

Put It in Writing

Finalize your agreement with a contract that describes every step of the project, such as:

Payment schedule, proof of liability insurance, the construction starting date, and the expected completion date, materials, and a requirement for lien releases from all subcontractors and suppliers(to protect yourself if the contractor doesn’t pay their bills).

Hire an Architect to Create Floor Plans

Hiring an architect or a designer is a good start if you’re unsure where to start. They will help you design your new home's floor plans with functionality and building codes in mind. A designer can consider the floor plan and help you pick building materials and colors.

Obtain a Building Permit

To be granted a construction permit for your new home, you (or your architect) must draw up a set of plans detailing what you're going to build, how big it will be, and what kind of materials are needed.

The building department will need to see and approve the final floor plans of your new house before granting you a building permit. You may need to obtain other permits during the construction process, such as structural, plumbing, HVAC, and electrical. 

A building permit may cost you a fee between $425 to $2,300. Be sure to obtain a permit three to six months before construction and notify the city if any changes occur during the construction process. 

An inspector from the city will visit the construction site at key construction points to make sure the work is done properly and according to code. Starting work without a permit or skipping out on hiring a home inspector may subject you to a fine and a significant delay.

Common Types of Insulation in New Houses

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Photo: artursfoto / Adobe Stock

Choosing the right building insulation material will make your home more energy-efficient and free from annoying drafts. Insulation can account for around 30% of a home's heating and cooling costs.

Here are the most commonly used insulation materials in new home construction.

Cellulose Insulation

Made of recycled newsprint or denim mixed with a bonding agent, cellulose can be installed as a loose-fill on the attic floor or as a blown-in material. However, cellulose is more expensive.

Fiberglass Insulation

You can install fiberglass insulation material in your wall cavities or between joists, beams, and studs. It's one of the most affordable options, but it’s less effective at blocking airflow and tends to sag over time. A professional must install fiberglass (or reinforced down the line) because the glass fibers can be dangerous when inhaled. 

Spray Foam Insulation

Spray foam insulation seals gaps and cavities inside existing walls. It starts as a liquid and then expands—up to 100 times its original size—and hardens once applied into a solid foam to fill the nooks and crannies. It's great for adding final touches to existing finished areas, as well as irregularly shaped or hard-to-reach spaces.

However, spray foam can be much more expensive when compared to other traditional insulating materials. In addition, foam consists of chemicals, which can cause respiratory problems if inhaled. An experienced professional will be able to handle this task safely.

Foam Boards

Foam boards insulation (aka rigid panels) is great for insulating almost any part of your home, from the roof, floors, or foundation. They are very effective in floors, interior, exterior walls sheathing, and attic hatches. 

They provide two times better thermal resistance than most other insulating materials of the same thickness. 

“We used foam boards in a historic renovation because the joists were smaller than in contemporary construction,” says Tschudi. “We discovered that the boards provided superior insulation, with reduced heating and cooling costs.”

Mineral Wool Insulation

Mineral wool insulation is similar to fiberglass material but more expensive. It can tolerate higher temperatures and has soundproof properties as well. Mineral wool comes in loose fills and is easy to install. Again, it’s best to leave the installation to a professional because the tiny slivers are dangerous if inhaled.

Reflective Barrier

Reflective or radiant barriers—also known as attic foil—work differently than most insulation materials. While standard insulation materials reduce heat flow in a home, reflective insulation reflects the heat away from the house and prevents heat gain. This makes it an excellent option for warmer climates.

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