Interview with Carl Heldmann, Author of Be Your Own House Contractor, Part 2 (And Giveaway!)

Here's part 2 of my interview with Carl Heldmann, author of Be Your Own House Contractor.

Free Money Finance (FMF): What are the keys/steps needed for people to save at least 25% (what do they need to do)?

Carl Heldmann (CH): People wanting to build have to visit as many new homes under construction as they can to get ideas on style, size, and quality.  Whatever a particular house is selling for they should be able to build it themselves, on a comparable lot, for approximately 25% less. This is the initial step. Then, they can start looking at house plans, estimating, etc., as explained in my book and web site.

FMF: Where do people save the 25%? (Can you break it down into sections like: save 10% on materials, 5% on labor, etc?)

CH: The breakdown of the selling price (market value) of a house is ideally: 25% material, 25% labor, 25% land cost, 12.5% builder profit, & 12.5% builder overhead. All builders must juggle the material, labor, land & overhead costs. This is what it’s all about. If you absolutely must have a certain expensive material item or subcontractor, you have to compromise and spend less on something else. A builder does all this in the planning stage on paper (a spreadsheet), not after construction starts. If it doesn’t work on paper, it surely won’t in reality.

What you are saving is the builder's profit and overhead.  Your savings are based on the difference between what the house will sell for when finished (the market value) and what it cost you to build. If it costs you more than a professional builder to build, your savings will be less. But even a 15% or 20% savings is a lot of money.

FMF: Can anyone really do this? Even someone with no building/do-it-yourself skill at all?

CH: I did it on my first house and thousands of people like me do it every year.  I am involved in their construction financing and I know this to be a fact.  Remember, all builders started with their first house.  They come from every walk of life, bankers, teachers, trades people, housewives, etc.  It’s not being skilled at construction that matters, it's being able to hire those who are (subcontractors).

FMF: The biggest issue I see is people thinking they can’t do it. Can you tell me why they can?

CH: The reason they think they can't is fear of the unknown.  My book and website should remove this fear.  If you love to shop, you will do well.  That’s what construction boils down to.  Finding the right materials (and labor) and putting them together to fashion the home of your dreams.

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That's it for today. Stop by on Monday and we'll have more.

Now for today's giveaway of a copy of Be Your Own House Contractor. Here's how it will work:

1. Leave a comment below -- any comment.

2. Sometime Monday, I'll stop by the post, stop the submissions, and name the winner.

3. It will be that person's responsibility to check back to see they are a winner and then email me their contact information.

4. I'll send all the winners their books in one mass mailing going out the second week in September.

A few rules for these giveaways:

1. You can not win more than one prize.

2. I will be the complete and final judge.

3. Legal disclaimer: I can not guarantee safe delivery of the items. I'll send them via US Mail, so it's likely they'll be fine, but I can't control it and won't be held accountable if the mail system messes up.

4. If you win something and do not contact me within a week of winning, I reserve the right to give your prize away to another winner. Note again: I won't track down the winners -- it's your responsibility to come back and see if you won.

Good luck! Post a comment below for a chance to win this book!

Comments

[Scott Moonen]

I would love to have a copy of this book! Thanks for providing the interview.

[juanny]

good morning

[Ryan]

A quick hello for the contest.

[rdub]

Does the book have coupons for Benford tools?

[Suresh]

From what i read from the interview, the book seems to be interesting. I will definetly get this book if i dont win a free copy. As i posted before, i am still 3-4 years away from buying a house and this book will be give a lot of time to ponder on the various issues. Thanks for providing such a good interview.

[Goose]

Try again.

[Blaine Moore]

Looking forward to another chance.

[Bobbi]

Where (or when) are the winners' names posted?

[Cherly]

The website seems a good resource. It really got me going!

BTW: where are you posting the winners ?

[Richard]

looking to be a winner today.

[FMF]

Regarding winners: look at the past posts. I stop by them the next day and name a winner. See the comments section of these as examples:

http://www.freemoneyfinance.com/2007/08/interview-with-.html

http://www.freemoneyfinance.com/2007/08/review-be-your-.html

[Cam]

Giving it another shot :)

[Tom]

Just starting down this path and would love the book!

[Scott Kustes]

OH OH (waves hand wildly)...pick me! Pick me!!!

[JMS]

Trying again...

[Topher]

Maybe today?

[Larry]

I'd like to check it out.

[Rich Schmidt]

If I don't win a book, I may have to go find it at the library or Barnes & Noble or someplace... This series is definitely whetting the appetite!

[Familyfinanceguy]

Trying again!

[Dee Whit]

Again, great infomation!

[Kelly]

No wammies, No wammies, Stop......

[Dave]

Count me in - thanks

[Glen]

I think his breakdown of costs is very important and will be an eye opener for anyone -- whether just being a "passive" buyer or planning to build themselves.

I will be curious to see what he has to say for selecting subs, scheduling their work, allotting for delays, and validating their work.

Finally, I hope he talks about people who shouldn't be their own GC's. Well beyond the obvious, self-selling type reply of course. I sincerely believe that some folk are better off writing the check and being grateful for someone handling the stresses involved in building. So I think his book would become more valuable by pointing out characteristics that you really need to have in order to be your own GC.

[Mike Horst]

Thanks for the great posts FMF, and for the chance to win! :-)

ESMO... glad to see you read FMF too!

[George]

I may be a little biased as I am a General Contractor, but one of the reasons these types of books sell is that consumers believe they can save money easily. There is nothing easy about building a house. Calculate how much your time is worth, multiply that by a year of your life and compare that to the cost of a GC. If it pencils out and you live for the challenge, enjoy.

[FMF]

That's a good point, George. As we'll get into later in the month, building your own hose WILL cost you something -- TIME. Yes, you can save a boatload, but you'll certainly earn that savings.

[DG]

Alright, I'm sold. Where do I sign up to build a home?

[Brian]

I'm looking forward to seeing more of the posts in this series. We (my wife and I) are planning on building a home soon, and we want to save as much as possible.

[Esther]

All I can say is I'm really glad this book exists. I've been thinking exactly that -- that I can be my own contractor... except that I don't know the first thing about it. But I'll be damned if I'm going to pay someone else that much to do it for me :)

*crosses fingers to win the book*

[Brad]

You picked the wrong Brad last time!

[JM]

third time's a charm?

[Nancy]

Still wanting a copy of that book.

[Rob18]

I’m glad I found this blog a few weeks ago. I’ve been planning on building my own house for the last few years and bought a piece of land recently. I’m at the stage of selecting the plan and hope to be my own contractor next year. The next website I visit after this is my local library to see if this book is available – it sounds like a great resource. Thanks for the good lead.

[Richard M.]

Please enter me in the contest.

[El Indio]

Another day, another entry.

Good interview questions so far! I hope to read the rest.

[Patrick]

I'm all for doing the little jobs, but major jobs are out of my realm of knowledge and (current) ability.

[Garan]

Here's to winning

[FMF]

This giveaway is now closed. The winner is El Indio who posted at 3:05 pm Saturday. Congrats!

El Indio, please email me (see: http://www.freemoneyfinance.com/2005/04/free_money_fina_4.html ) and we'll arrange to get you your book.

To the rest of you, stay tuned. I still have plenty of copies to give away!

[Brian]

Please let me win this time....