Construction cost DOUBLED. We have a cash crunch.

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gordon9775
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Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

Hi all—

We're selling our house in one state, building a smaller one in another state. Our builder has built a handful of houses and is just starting to get into the ADU (granny flat) market. They're local and this house will be extremely efficient. We support their mission and want to make this work. So do they.

However, they are not great at passing along bad news. And today we got some really bad news, which is that the 249K budget is now 485K. :oops:

Of course, we have been reading the news, we know what's going on in the world. The near-doubling of our project budget, however, is unacceptable, so we now have three choices: pare the current budget, redesign the house, or find a new builder. We're starting with option 1, and have told the builder to find 85K in cost savings.

Since we'd expected to finish work on the new house before selling and moving, that leaves us in a cash crunch. Our bridge loan doesn't come anywhere near covering the new construction costs. Here are the numbers ...

Goal construction budget (after cuts, minus fees paid to date): 389K
Available in HELOC: 230K (LTV 80%, low appraisal)
Current home value (estimated, by our realtor): 435K
RMD remaining for 2021: 10K
RMD available for 2022: 30K
401k and IRA for me: 548K
Roth IRA for me: 12K
401k and IRA for her: 733K
Cash on hand: 10K

I'm in my 50s, wife is in her 70s. We're boring Bogleheads with a handful of big funds, 65/35 stocks for me, 35/65 for she. She has mild dementia and this house will be ideal for us.

So my question is, what's the least painful way of getting this done? If you have a loved one with dementia, I don't need to explain why I'm trying to avoid making two moves next year. But it may come to that. :confused

Thanks for any insights, happy to fill in any blanks.
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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vanbogle59
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by vanbogle59 »

gordon9775 wrote: Thu Oct 14, 2021 1:00 pm Our builder has built a handful of houses and is just starting to get into the ADU (granny flat) market.
...
the 249K budget is now 485K. :oops:
I am not a general contractor. I am just a consumer of housing.
If I were to come across a builder with very little experience and found that they couldn't price a project within 100%, I would run, not walk.
flyfishers83
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by flyfishers83 »

What gives you confidence that the new budget is any good? I would not be comfortable just trying to shave money without having a really complete understanding of the differences and expectations about how to meet the new budget.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Lee_WSP »

I would cut my losses. Sorry if that’s not what you wanted to hear.
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gordon9775
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

No that’s good feedback. But I’d still like to know how folks would deal with the finances.
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by adamthesmythe »

It's not clear what stage you are at (has anything been started?) and whether this is an ADU on your existing property? And WHY the cost has increased? Were there unexpected site preparation problems?

It is extremely typical for costs to increase during construction. Maybe more so right now than usual. But 2X is very considerable, and given that there may be other unexpected increases it seems unlikely from your numbers that the new house will cost less than you will realize when you sell your existing house.

This calls for a considerable rethink, and a rethink that does not consider "supporting a mission." Unless, of course, you can afford a considerable charitable contribution.
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8foot7
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by 8foot7 »

The simplest (but certainly not easiest) answer here is to cut your losses.

So many red flags

- new builder in a new market segment - clearly did not price well from the beginning, may not understand what features are important vs what savings to achieve by cutting
- communication issues (the increases did not all hit him last week; this has been building for some time making it more difficult for you to hit the eject button)
- massively incorrect estimate -- things are going on in the world, yes, but raw materials have not doubled and his labor costs may have increased but can be contained by lengthening the timeline of the project or doing some of the work himself

Unclear how far along you are but it is almost certainly worth it to end the current project and rescope/redesign/rebuild with new builder.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by ivyhedge »

@8foot7 is on point.

This is either an egregious underestimation, or a cash grab. Both suggest dissolution of your agreement, possibly using legal representation should you not receive what is due you.

I waited 80 days for my Tesla. Had the car's price doubled on delivery day, I'd have walked.*

You're talking about another order of magnitude: wow. Sorry to hear this.


*Note: for those thinking that Tesla has increased all vehicle prices...they have - several times - but once you lock your purchase price, changes don't affect you.
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Mr.Chlorine
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Mr.Chlorine »

How many weeks (months?) between the $249k and $485k budgets? If you have nothing in this but time, I would press pause on this builder and talk to a few more.
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gordon9775
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

OK, a little more context.

We are building in the backyard of a church property. The church is where the wife and I married before we left the states. And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it. We are happy to do this. We are meeting a specific need in the community.

What we are not happy with is the current project budget. I just ran some numbers and realized that we are paying per square foot twice what any ADU that I know of is costed out at.

There were questions about the level of our involvement so far. So far we have paid a design fee and a plat of survey. Not much at all. This is a contract that we can get out of. Of course it means that we will be starting over and likely not getting an ADU built until 2023.

I appreciate the feedback. For the record, I don’t think that there is anything nefarious going on here, but incompetence isn’t much better.
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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ResearchMed
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by ResearchMed »

gordon9775 wrote: Thu Oct 14, 2021 1:58 pm OK, a little more context.

We are building in the backyard of a church property. The church is where the wife and I married before we left the states. And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it. We are happy to do this. We are meeting a specific need in the community.

What we are not happy with is the current project budget. I just ran some numbers and realized that we are paying per square foot twice what any ADU that I know of is costed out at.

There were questions about the level of our involvement so far. So far we have paid a design fee and a plat of survey. Not much at all. This is a contract that we can get out of. Of course it means that we will be starting over and likely not getting an ADU built until 2023.

I appreciate the feedback. For the record, I don’t think that there is anything nefarious going on here, but incompetence isn’t much better.
And you don't want to add insult to injury/etc., by then having incompetence in the build by a contractor who hasn't done this type of property before.

Unless you MUST move - and must move HERE (?) - it sounds like a great opportunity (that you found out this early!) to find someone else.
ETA: Have you already completed the sale arrangements on the current place?

Is there any chance that the builder doesn't want to do this anymore (or realizes they can't) and they are trying to force you to cancel rather than backing out themselves?

I'd strongly suggest that you move on.
And find someone who has done these before, and some that you can actually look at.

RM
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vanbogle59
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by vanbogle59 »

gordon9775 wrote: Thu Oct 14, 2021 1:58 pm And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it.
The plot thickens.
Is that really a charitable contribution? (I don't work for the IRS, but the free rent sure sounds like income.) You may want to solicit professional advice.

If it were me (and it's not) and I wanted to have a place to live and to make a contribution, I would keep control and separation.
Build what I need. Use it till I'm done. Then, either donate the actual facility or sell it and donate the proceeds.

Good luck.
Be sure you lead with your head and not let your heart get you into a situation you don't want.
Last edited by vanbogle59 on Thu Oct 14, 2021 2:08 pm, edited 1 time in total.
pizzy
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by pizzy »

gordon9775 wrote: Thu Oct 14, 2021 1:29 pm No that’s good feedback. But I’d still like to know how folks would deal with the finances.
I wouldn't deal.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by pizzy »

gordon9775 wrote: Thu Oct 14, 2021 1:58 pm I don’t think that there is anything nefarious going on here, but incompetence isn’t much better.
Incompetence is worse.
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ResearchMed
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by ResearchMed »

vanbogle59 wrote: Thu Oct 14, 2021 2:05 pm
gordon9775 wrote: Thu Oct 14, 2021 1:58 pm And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it.
The plot thickens.
Is that really a charitable contribution? (I don't work for the IRS, but the free rent sure sounds like income.) You may want to solicit professional advice.

If it were me (and it's not) and I wanted to have a place to live and to make a contribution, I would keep control and separation.
Build what I need. Use it till I'm done. Then, either donate the actual facility or sell it and donate the proceeds.

Good luck.
Be sure you lead with your head and not let your heart get you into a situation you don't want.
I think part of your answer may be here, above ^^

Buy a house wherever you want it to be, next to the church, across the street, across town, where you are now...
Make it an ADU or not, depending on location. Make it "perfect for YOU" if you are building or remodeling. Don't worry about how the church would use it.
Then, later, leave the house (wherever it is) to them or sell it and leave them whatever $$ you want so that they can build the ADU or do something else.
After all, the *church* isn't going to be using the ADU until that time.

Now, maybe reading between the lines, was the proximity to the church for some additional reason, such as help from other members later, or such?
If so, then buy nearby... or just pay someone when/if it's necessary.

Is there a reason that this two-stage process wouldn't work, for you and then later for the church?

RM
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Sandtrap »

Exit everything.
Reset
Reboot
Purchase an existing home in your area with more known than unknowns.

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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gogreen »

gordon9775 wrote: Thu Oct 14, 2021 1:00 pm
However, they are not great at passing along bad news. And today we got some really bad news, which is that the 249K budget is now 485K. :oops:

Of course, we have been reading the news, we know what's going on in the world. The near-doubling of our project budget, however, is unacceptable...
Welcome to the brave new world :oops: I wouldn't put any extra details about inflation b/c such posts are considered political somehow but I think you know it without me :sharebeer
Here is the thing - if they'd build it in time for new double budget you could consider yourself REALLY lucky.
There are 2 more possible outcomes however - request for new chunk of money after some time or 1 yrs plus delay :oops:
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8foot7
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by 8foot7 »

My wife tells me all the time that I have many thoughts I deem Good Ideas that really do seem like logical Good Ideas to me, but that she says are terrible ideas in the real world. Your plan may be an example of that.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by FarmWife »

gordon9775 wrote: Thu Oct 14, 2021 1:58 pm What we are not happy with is the current project budget. I just ran some numbers and realized that we are paying per square foot twice what any ADU that I know of is costed out at.

There were questions about the level of our involvement so far. So far we have paid a design fee and a plat of survey. Not much at all. This is a contract that we can get out of. Of course it means that we will be starting over and likely not getting an ADU built until 2023.
Given this information, I would walk away. You're out of pocket is very little so far. There's no reason to pay double per sq ft what others would be paying. Perhaps the contractor is in over his head and is trying to price you out. Either way, this no longer seems like a good fit. Find a new builder, or find a new place. Grieve the loss of the dream if the new timetable is too far out for her, but don't add $250k to the project. Even without dementia I wouldn't want to move twice, but it seems unlikely avoiding that is worth $250,000. Ouch. Not to mention you haven't started the build yet, prices will likely increase even more from there. New builds always seem to add 10-20% by the time they're done anyway, that shoots you even farther above your budget. Chopping $85k off the project will not make you happy in the end. You'd still be above cost goals and have fewer features that you'd set your heart on. Nope, I'd walk.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by tim1999 »

Unless we are talking about the world's largest ADU with very high-end finishes, 485k to build this on a lot that should theoretically require very little earthwork and utility extensions (a developed church property) is completely insane. I'd be curious to see the builder's breakdown of exactly where these cost increases are on a line-item basis.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by dboeger1 »

8foot7 wrote: Thu Oct 14, 2021 2:55 pm My wife tells me all the time that I have many thoughts I deem Good Ideas that really do seem like logical Good Ideas to me, but that she says are terrible ideas in the real world. Your plan may be an example of that.
This definitely sounds like one of those things to me. I know of a few examples:

1) I had a Church friend years ago who kept pouring money into repairing an old car that he had bought used, to the point that he spent way more than it was worth on repairs. It had been heavily modified for street racing by the prior owner and probably had poorly done work, or at least work that wasn't optimized for longevity/durability. Not only that, but my friend felt obligated to take it to a mechanic who was a family friend, primarily because of cultural ties, but who otherwise seemed really incompetent. His repairs were never done right the first time, and he would always charge significantly more after the initial attempt to basically redo his work properly once he really knew what was going on.

2) That same friend was extremely generous to the local homeless population as part of his religious service, so he would keep me up to date on the status of several of the homeless who would show up at Church asking for donations. This one lady in particular had been homeless for years but somehow managed to get a job, and was approved for a low-income apartment, so it seemed like she was finally on track to get her life back together. However, things took a turn for the worse when she let her drug-dealing brother come back into her life, which messed with her mind to the point that she really couldn't make good decisions. One Sunday Mass, we heard a loud glass shattering noise out in the parking lot during the service. At the end of the service, my friend and I went back out there to see what had happened, and there had clearly been a car that left after having one of its windows shattered. I later found out from my friend that it was that homeless lady. She had locked her keys in the car and didn't know how to get in, so the only thing she could think to do was to smash her window. It turns out she was living in her car again after being kicked out of the low-income housing, so we would see her camping out in her car at night with her window smashed open.

3) The same Church had originally been associated with a particular ethnic community in the early 1900s, but over time, the area diversified, and the community associated with the Church in particular had mostly disappeared. [OT comments removed by admin LadyGeek]

You'll notice I specifically pointed out Church-related examples. I'll stop short of painting all religion with a wide brush because I imagine that would violate forum rules, but I will say that in my experience, [OT comments removed by admin LadyGeek].

You want to give your Church something. That's wonderful. You should do that if it's meaningful to you. But what does that have to do with you living in it, or any particular contractor, or any particular timeline for that matter? Live where you want to live with your family. Wait until you have the money the build this ADU thing for your Church. Get multiple bids from experienced builders and pick the most sensible one. It sounds to me like you can't really afford this "donation" at this time, because you're jumping through all these hoops to make it happen, such as living in the ADU rent-free, trying to sell your current house, etc. That's okay, not everyone can afford to build a new building for their Church right away. That's a very generous gift. I think the Church will survive if they have to wait a few more years for you to be in a position to do it comfortably. As for filling a current need, when do Churches ever not have the same ongoing needs? Your Church believes they "need" this ADU today, but they're going to need it tomorrow and next year and 50 years from now, I promise. There's absolutely no need to put up with surprise doubling of costs or having to live in the ADU in order to get this done right away.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Lee_WSP »

gordon9775 wrote: Thu Oct 14, 2021 1:29 pm No that’s good feedback. But I’d still like to know how folks would deal with the finances.
I've read the follow ups. But the advice is the same.

I'd just hit the reset button. I always hit it when things go fubar, take a step back, let it go cold and old, then reassess what the options are and what the best course of action is.

The good news is that it doesn't sound like you're under any sort of time constraints to make a decision. So I'd just hit pause and start over from finding the builder etc. The plans will still be good for a while I'd imagine.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

Lee_WSP wrote: Thu Oct 14, 2021 3:56 pm
gordon9775 wrote: Thu Oct 14, 2021 1:29 pm No that’s good feedback. But I’d still like to know how folks would deal with the finances.
I've read the follow ups. But the advice is the same.

I'd just hit the reset button. I always hit it when things go fubar, take a step back, let it go cold and old, then reassess what the options are and what the best course of action is.

The good news is that it doesn't sound like you're under any sort of time constraints to make a decision. So I'd just hit pause and start over from finding the builder etc. The plans will still be good for a while I'd imagine.
Thanks again to you and everybody else. I knew I was posting this in the right place.

We hear the room and we think the room is right. Especially the fact that the costs can go higher, which isn’t a very politically dangerous thing to say after yesterday’s report. Once the loaf gets punched down, it will rise again.

I’m happy to discuss religion but I doubt I’d persuade anyone. The salient point here is that the church is builder neutral. These aren’t their guys. They are a group of highly educated green architects who, we are discovering, are also green builders, as in greenhorns. We like them, the church folks like them, but I think they have priced themselves out of our range. And they’ve raised enough red flags that I don’t think we can proceed with them. I know they will have no problem finding business.

Dang, is all I can say right now. :annoyed
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

tim1999 wrote: Thu Oct 14, 2021 3:41 pm Unless we are talking about the world's largest ADU with very high-end finishes, 485k to build this on a lot that should theoretically require very little earthwork and utility extensions (a developed church property) is completely insane. I'd be curious to see the builder's breakdown of exactly where these cost increases are on a line-item basis.
We would too!!! We have requested a meeting and there will be builder dudes from the church at that meeting.

I wish we were in California where they have all kinds of prefab options. That might be the first time in my life I’ve said, I wish we were in California…. :D
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by sailaway »

gordon9775 wrote: Thu Oct 14, 2021 4:12 pm
Lee_WSP wrote: Thu Oct 14, 2021 3:56 pm
gordon9775 wrote: Thu Oct 14, 2021 1:29 pm No that’s good feedback. But I’d still like to know how folks would deal with the finances.
I've read the follow ups. But the advice is the same.

I'd just hit the reset button. I always hit it when things go fubar, take a step back, let it go cold and old, then reassess what the options are and what the best course of action is.

The good news is that it doesn't sound like you're under any sort of time constraints to make a decision. So I'd just hit pause and start over from finding the builder etc. The plans will still be good for a while I'd imagine.
Thanks again to you and everybody else. I knew I was posting this in the right place.

We hear the room and we think the room is right. Especially the fact that the costs can go higher, which isn’t a very politically dangerous thing to say after yesterday’s report. Once the loaf gets punched down, it will rise again.

I’m happy to discuss religion but I doubt I’d persuade anyone. The salient point here is that the church is builder neutral. These aren’t their guys. They are a group of highly educated green architects who, we are discovering, are also green builders, as in greenhorns. We like them, the church folks like them, but I think they have priced themselves out of our range. And they’ve raised enough red flags that I don’t think we can proceed with them. I know they will have no problem finding business.

Dang, is all I can say right now. :annoyed
Maybe the plans are already technically yours, but if not, see if they would be willing to let you contact another GC in the area with their plans to get pricing from more experienced hands.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by 123 »

gordon9775 wrote: Thu Oct 14, 2021 1:58 pm ...We are building in the backyard of a church property. The church is where the wife and I married before we left the states. And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it...
If you don't own the property you want to build on a builder may be reluctant to get involved. Perhaps he's upped the price to get out of a deal that he belatedly realized had some insurmountable obstacles (for a builder). He may not want to advance funds for any work or materials when there is a chance he would be unable to enforce a mechanic's lien if you don't pay. He may have recognized that it could be very difficult (in a number of respects) to collect on a judgement against a church.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

123 wrote: Thu Oct 14, 2021 4:20 pm
gordon9775 wrote: Thu Oct 14, 2021 1:58 pm ...We are building in the backyard of a church property. The church is where the wife and I married before we left the states. And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it...
If you don't own the property you want to build on a builder may be reluctant to get involved. Perhaps he's upped the price to get out of a deal that he belatedly realized had some insurmountable obstacles (for a builder). He may not want to advance funds for any work or materials when there is a chance he would be unable to enforce a mechanic's lien if you don't pay. He may have recognized that it could be very difficult (in a number of respects) to collect on a judgement against a church.
We went through a very thorough vetting of the deal with three sets of lawyers. Everyone appreciated the unusual nature of the transaction.

Whatever opinions people have about church communities from their childhood and HBO documentaries, there’s a reason I left the church out of my original post. It’s not relevant. The church is not the problem.
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Big Dog »

if its an ADU-style house, I would contact some local builders that specialize in such things. For example, there is a fair amount of interest in ADU's in some California communities, adn cities have pre-approved their plans for easy and fast builds.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by gordon9775 »

I know, I’m very envious.

I just located another ADU builder in our state, reputable, long track record … and they are all prefab.
‘Well done, good and faithful servant. You have been faithful over a little; I will set you over much.’ Matthew 25:21
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by whodidntante »

What a disaster. I would rip myself out of this obviously doomed deal, recovering anything possible.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Californiastate »

AFAIK the builder is still able to lien the church if you fail to pay. His subs and suppliers can also. I can see the contractor changing his pricing just for this reason. I’ve changed pricing or avoided bidding on certain projects. The OP isn’t the owner of the property. The contractor would be forced to lien and sue the church. It wouldn’t be good for future business. I’d try and find a parishioner who was a contractor.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by DarkHelmetII »

I have been poking around multiple modular home builders / manufacturers / dealers and general since of price increase relative to pre-COVID has been in the neighborhood of 15 - 30%. I am no expert and maybe price impacts of stick built homes is wildly different from modular .... but 2X, even with the COVID uncertainties, sounds pretty far out there.
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Jimbo Moneybags »

IMO the decision to commingle various objectives (new house, donation to church, "green" building practices) is financially unwise. Well perhaps not unwise, but it comes at a steep cost. If part of your reasoning behind how you have structured this plan is to leave a charitable gift to your church, is it the best stewardship of funds to spend more on an environmentally-conscious custom build on land owned by the church?

I'd consider unwinding the deal and then address each of the component parts individually:
1. Unless you must build a custom house, find an existing one within your budget that will meet your future needs.
2. Budget funds to make appropriate modifications if being "green" is that important to you, such as solar panels, gray water irrigation and so on.
3. Make charitable contributions as you see fit during your lifetimes, consider effective giving strategies (donating appreciated shares, a donor-advised fund and/or a charitable remainder trust) and talk to your attorney about leaving specific charitable bequests in your will.
andypanda
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by andypanda »

"They are a group of highly educated green architects "

I've known architects, but I've known more contractors, tradesmen and such. The tradesmen have told horror stories for 40 years about architects - young ones usually - who make things look good on paper but don't have real world experience when it comes to ordering the proper materials in the proper order and planning simple things like leaving the pipes far enough from the wall to get a wrench around them. All things that delay work and drive up the price. And the HVAC guys love the plans that put the air handler in a closet that doesn't' leave room to change the filter or remove the inspection panel to clean or replace the coil.
scguy613
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by scguy613 »

I would run, not walk away from this. Why even build on church property? You can build anywhere and leave it to your church in your will if you want them to eventually own it. Find a more competent builder for sure.
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Tamarind
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Tamarind »

I'm not knocking the original plan, but I think the budget failure has ended any chance of going ahead with it.

Since you have not broken ground and have no sunk cost in land, stop here. Find either a different builder (one with no association to the church) or a different location.
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Sandtrap
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by Sandtrap »

123 wrote: Thu Oct 14, 2021 4:20 pm
gordon9775 wrote: Thu Oct 14, 2021 1:58 pm ...We are building in the backyard of a church property. The church is where the wife and I married before we left the states. And it is in fact a charitable contribution, in the sense that we will live in it rent free until we leave, and then the church owns it...
If you don't own the property you want to build on a builder may be reluctant to get involved. Perhaps he's upped the price to get out of a deal that he belatedly realized had some insurmountable obstacles (for a builder). He may not want to advance funds for any work or materials when there is a chance he would be unable to enforce a mechanic's lien if you don't pay. He may have recognized that it could be very difficult (in a number of respects) to collect on a judgement against a church.
+1

OP: this is a salient point to pay attention to.
. . . another elephant in the room. . .

j :D
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alpenglow
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by alpenglow »

I live in a high cost of living area. Two friends (separate projects) are working on building new homes. While there have been some price increases, I haven't heard anything like what you are describing. Something isn't right. Run away.
pasadena
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by pasadena »

What I'm really curious about is how did the builder justify this? I mean, they didn't just text you an updated price, did they? So what did they say after you recovered from the shock?
suemarkp
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Re: Construction cost DOUBLED. We have a cash crunch.

Post by suemarkp »

Building right now is a pain with all the random material shortages. You never know what is going to be missing on the shelves. I'd cancel and delay if possible until the supply chain is closer to normal.
Mark | Somewhere in WA State
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