Owner builder/builder engagement models

Hi Folks. I'm new here so please forgive if I say something dumb.

Anyway, we expect to undertake an owner build project in the near future and I'm curious and somewhat confused about the different ways that owner builders can contract with carpenters/builders/projectmanagers or whatever to actually do the building.

I will try to give some background of what might be relevant.

4 bedroom, 2 storey, 3 bathroom house. Mainly timber frame. Generally fairly simple, conservative build. Flat level block on NSW Central Coast. All cash, no finance. No time pressures, we have a house to live in till the build is done. I'm retired (early) so plenty of time. Wife also retired and available to do sourcing, phonework etc. I have done several renos, kitchens, bathrooms etc as hands on.

We are expecting to engage a legit builder to do the house up to lockup stage. My name and OB permit will be on the DA, but really I will be owner building in name only at that stage. I will probably be doing clearly delineated jobs (the staircase, external joinery, all painting, cleaning) but basically I expect the builder to be fully confident and experienced at handling the construction stage. I understand I am not an expert in this area so don't intend to be looking over his shoulder.

After lockup, I expect to project manage the fit out. I expect it will be mostly managing trades, though I would like to do the kitchen and bathrooms after the tiling is done.

I expect there are different ways to engage builders to do the lock-up stage under my OB permit. Can anyone elaborate on these. What sort of arrangements did you have ? How well did it work ? Was it easy to find interested parties ? etc

cheers

Don't engage a builder unless you have a fair idea of what you are doing?
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cheers

No response !

Does that mean there are no owner builders on this site ?

Or are they simply too busy building to take the time to respond ?

Hi Godwit. Not sure if I'm answering directly what your after but I'll have a go.
By employing a builder to build to lock up under your OB licence you are essentially just using him as a project manager. Problem I can see is that any builder will still want to be making his typical margin (otherwise why do it) but will carry no responsibility as you are technically the builder and will have to deal with any issues long term.
The savings to risk benefit for someone who isn't experienced may not make it practical.
The other option is to find a builder who will build to lock up. This way he has to provide a warranty on the structural component of the build. Many builders don't like doing it as there is a certain amount of cross over with trades. The electrical and plumbing for instance has to be roughed in during the initial construction but is finished after lock up, so does the builder do it all or do you do the final fit off? What about waterproofing etc, it can get messy if clear roles aren't set out.
Your going to have to find a small independent builder who is prepared to work with you whether as a builder or PM and then negotiate an outcome that works for both of you.
If the builder uses his licence to build to lock up (giving you a structural warranty) then you use an OB licence to finish would be one option or see if the builder will let you act as the nominated trades for the parts you want to do. He will still add his margin even for the things you do, all you would save is the labour costs.
Hopefully that helps somewhat.

Thanks Chippy, that’s very informative.

Our original preference was to get a builder to do to lockup stage, under their own licence and warranty. Then we would take it from there and do the fitout under my ob licence. The problem is that the local council doesn’t allow two builders licences on the DA (or is it the CC). So presumably it has to be the OB licence all the way through. It’s not ideal but my brother, my parents and several of our friends all built their houses that way and i don’t get the sense they have regrets.

Or we may just get a builder to do the lot. We’ll see what happens when we have the CC in our hands. If we find a builder we really trust and the price is right then we’ll go that way.

Another option I like is to get the builder to do everything except cabinetry (kitchens, bathrooms, laundry) and me just do those. I’m very particular there in terms of quality but it’s mostly an issue of design.

Thanks for your reply

Hi, I'm owner building at present in NSW. I had a builder who builds extensions and the like. I worked with him and his apprentice to the point where upstairs walls and floors were up and ready for roof trusses. I'm now fixing the roof trusses myself as he had another project and prior planned holiday.
I had a contract where I paid an hourly rate plus 10% margin on his purchases, however, not on things I sourced (which was the bulk of it). I couldn't understand why there is a margin on something I can usually purchase at a very price. The builder doesn't have an incentive to get the best price as he will get it back plus his kick. If he tenders for the job, he is more likely to be looking for ways to cut costs.
In the end, if you're not going to be involved with the actual construction, I would get a fixed price to lock up and renegotiate at that point.
The home warranty insurance is one big load of rubbish and not worth the massive fee the owner has to pay. There is little chance you can claim on it as the builder has to be dead, bankrupt or disappeared. You can't claim legal costs arising from trying to get work rectified and these costs will probably out way the claim.

Thanks Searching.

Ok, that makes one for ‘hired builder on hourly rate, with 10% margin on items he supplied’.

How did you find the builder, and how did you evaluate him before taking him (or her) on.


Plus I’m aware of what a scam the Home Warranty Insurance is. I have some exposure through helping some older folk through the process. Tragic.

Hi godwit sorry for not replying earlier. I did a build the same way . Don’t forget you have to insure workers on site you hire if they don’t carry their own insurance. i had a problem with that when an uninsured guy had a minor accident. Regarding the overall build I hired a guy on recommendation but he was expensive and did the build frI’m go to whoa. I had to take out builders insurance just in case I moved in the 7 years of required warranty. This was a waste of money. The trades won’t work if some other trade hasn’t finished or is on site and found they rushed some of the work and had to be called back. Remember as you are holding the licence you are in command no matter what.

Hi TGW, for workers it's more who you know than what. If I have a tradie working or I'm talking to one, I'll quiz him about other trades he can recommend. So far this had worked out well. I keep a list of phone numbers and if you can get the tradie to contact them, even better.