Browse Forums General Discussion 1 Aug 13, 2011 12:00 pm We are looking at kit home companies. The thing is, you buy the materials from them, and then arrange for a builder to erect the home, which requires two contracts. Some companies organise and manage the build contracts and the builders. Some can sell the materials to the builder directly so you only have to use one contract. Are there any issues with using two contracts? I have heard it is difficult to get finance? Re: Building With Kit Home Companies 2Aug 15, 2011 10:09 am i am in no way an expert in any of this but here's what i think from a financial POV... * kit home companies deliver ur house in an ikea style flat pack. builder then needs to put it together. * before this kit is delivered, the kit home company requires a large payment. * Banks see this kit as a pile of sticks, and not the half finished project home that it is, making it difficult to obtain the proper financing to pay the kit home company. its a vicious circle... unless you are able to negotiate something between the builder and the kit home company to progressively deliver and erect the home, making it seem more "project" like... otherwise, you'll need A LOT (parden the pun) of equity or free flowing cash to fund the build... just my 2c... Cheers Dan Building With Kit Home Companies 3Aug 16, 2011 7:17 am Hi As Dan said, it can be a bit tricky. We are building a kit using an independent builder. Fortunately we sold our house and have moved into rental so we had enough money to buy our land outright. The bank is giving us a mortgage against the land so we can purchase the kit and then we will have a standard construction loan for the build. Once construction is complete we can get a valuation and consolidate the two loans into one. It wasn't too hard for the bank to organize, but if we didn't have the equity in the land we wouldn't have been able to do it. We have also had to do a lot more running around organizing things that a package builder would do (such as the DA), but on the whole I think it is worth it. My father in-law recently built with a package builder and they were pretty inflexible - you had to use their suppliers etc. Our builder is happy for us to organize things directly where we want and use him when we want. He is also happy to organize things like electrical on a prime cost (pc) basis where we will only pay the actual cost. Paul Re: Building With Kit Home Companies 4Aug 16, 2011 6:33 pm Yeah two contracts means you have to negotiate terms two times and this can cost you. Thats why one contract is always preferred . We already paid for somfy motors for the blinds. The quote above was purely for “pre-wiring” so the blinds company can install the motors and blinds. That’s why we… 5 16097 go upvc window frames ensure insulation under colorbond. not just sarking, lighter color roof also not sure if you have seen this viewtopic.php?t=5823 last couple of pages… 4 110523 |