# Financial considerations when embarking on a self-build project Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2020-03-04 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: The Financial Considerations of Embarking on a Self-Build Meta Description: Explore the financial aspects of self-build projects with property expert Sandro Heitor. Find out how to avoid wasted budget and unsatisfied customers. Tags: featured Tag URLs: featured (https://financedigest.com/tag/featured) URL: https://financedigest.com/financial-considerations-when-embarking-on-a-self-build-projecthtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/fd200718-1-2-1736838938571-compressed.jpg) _By **Sandro Heitor,** Founder of Trio._ When exploring your options for renovating a property, or perhaps building from scratch, it can be tempting to explore the self-build route as it could potentially save you valuable money and allow your budget to stretch further. That said, there are likely to be aspects which do require the expertise of contractors and in some cases, it can be more efficient to pay someone to complete a phase of the project quickly, than to draw it out by trying to do it yourself. Here, property expert Sandro Heitor, founder of [**Trio**](https://www.trio-thedifference.com/) explores the financial considerations of embarking on a self-build project. The [construction industry](https://www.financedigest.com/growth-of-construction-industry-is-creating-demand-for-screw-washer-market.html "Growth Of Construction Industry Is Creating Demand For Screw Washer Market") is fraught with negativity and assumptions that all builders are likely to overprice and cut corners to ensure they make as much as they can from a particular project. This view is unfair in my opinion, as there are a great many contractors who are ethical, professional and highly cost-efficient. The trouble is that unless you can obtain recommendations from previous customers, it can be difficult to tell from the outset, as they all talk the talk! Whilst there are certainly some cowboys out there, there are also contractors who are doing a good job yet poor [management of the project leads to wasted](https://www.financedigest.com/food-waste-management-market-expected-to-expand-more-than-three-fold-through-2032.html "Food Waste Management Market Expected to Expand More than Three-Fold through 2032") budget, avoidable delays and unsatisfied customers. We conducted our own research into a variety of projects and found that some had been left with as much as 50% of their budgets wasted on projects that had only been 30% completed. Invariably, the causes were inaccurate valuations, poor project management and poor [money](https://www.financedigest.com/fine-tuning-your-money-management-skills-today.html "Fine-tuning your money management skills today") management. So how can this be avoided? When embarking on a self-build project, it is [important that you follow these key steps](https://www.financedigest.com/eu-u-s-step-up-russian-aluminium-nickel-imports-since-ukraine-war.html "EU, U.S. step up Russian aluminium, nickel imports since Ukraine war"), in order to avoid being hit with any hidden surprises once the project is underway. 1. **Seek quotations from at least 3 suppliers** Even if you have received recommendations for a particular supplier, or have worked with others in the past, I would always suggest [gaining at least 3 quotes for your project](https://www.financedigest.com/cherry-picker-crane-market-is-expected-to-experience-substantial-gains-with-projections-around-6-to-8-cagr-from-2021-to-2031.html "Cherry Picker Crane Market is expected to experience substantial gains, with projections around 6% to 8% CAGR from 2021 to 2031") from different suppliers. This will help you to gauge [whether the prices](https://www.financedigest.com/graphic-chip-price-drop-raises-questions-on-whether-end-of-shortage-is-in-sight.html "Graphic chip price drop raises questions on whether end of shortage is in sight") being put forward are fair, competitive and realistic. This isn’t always about finding the cheapest supplier either, it’s about finding someone who has the right expertise, understanding and capabilities for the task at hand. Also make sure that you are clear what exactly is being quoted for in each case, so that you can compare like with like. Some may be [offering additional services or skills within their pricing](https://www.financedigest.com/online-brokerage-robinhood-jumps-29-to-surge-past-offer-price.html "Online brokerage Robinhood jumps 29% to surge past offer price") which may need to be factored in. 2. **Create a timeline for activities** Be [sure to work](https://www.financedigest.com/making-sure-you-are-compliant-when-working-in-the-finance-industry.html "Making Sure You Are Compliant When Working in the Finance Industry") with your chosen suppliers to create a realistic and achievable timeline of activities, including building in some contingency time for unexpected delays. Suppliers who really understand the project will be able to provide you with some clear milestones, so if your contractor is being fairly generic with timescales, it could be a [warning sign](https://www.financedigest.com/why-training-your-staff-is-key-in-spotting-the-warning-signs-of-a-cybersecurity-breach.html "Why training your staff is key in spotting the warning signs of a cybersecurity breach"). If you are paying by the day, try to get the contractor to provide both best and worst case scenarios, so that you have an idea of how far the budget might need to be stretched. Check in with them at [key points in the project to check on progress against this plan](https://www.financedigest.com/why-financial-planning-should-be-a-key-subject-at-school.html "Why financial planning should be a key subject at school") and to amend the budget and future timeline if things have changed. 3. **Don’t pay it all upfront** Sometimes it can feel easier to hand over all of the cash for the project upfront so that you know it is all paid up and can progress without a hitch, but this can be a very dangerous game as leaves you with very little wiggle room if [things don’t](https://www.financedigest.com/12-things-that-dont-hurt-your-credit-score.html "12 Things That Don’t Hurt Your Credit Score") go to plan. It is understandable and perfectly [acceptable for a contractor to require upfront payment](https://www.financedigest.com/why-ev-charging-stations-need-to-accept-open-cashless-payments.html "Why EV Charging Stations Need to Accept Open Cashless Payments ") for materials and potentially the first few weeks/months of labour, but any credible supplier will be happy with a staged payment plan. This helps to protect you against losing money and gives the contractors an incentive to [hit certain milestones on time](https://www.financedigest.com/coca-cola-hbc-flags-one-time-195-million-hit-from-russian-operations.html "Coca-Cola HBC flags one-time 5 million hit from Russian operations"). 4. **[Consider an external project](https://www.financedigest.com/4-important-factors-to-consider-when-choosing-an-eb-5-visa-investment-project.html "4 Important Factors to Consider When Choosing an EB-5 Visa Investment Project") manager** Many excellent relationships in the contractor [industry have turned sour due to disagreements or misunderstandings and the added emotional attachment of a self-build can make the process much harder and more stressful to manage](https://www.financedigest.com/how-application-management-can-help-tackle-the-finance-industrys-carbon-emissions.html "How application management can help tackle the finance industry’s carbon emissions") effectively. Employing the services of an external project manager allows an impartial [third party](https://www.financedigest.com/why-a-replacement-to-third-party-cookies-is-key-to-post-pandemic-recovery.html "Why a replacement to third party cookies is key to post-pandemic recovery") to oversee the project and ensure it follows the agreed timescales and budget. In almost all cases, the [gains in efficiency will offset](https://www.financedigest.com/ftse-100-up-as-astrazeneca-gains-offset-commodity-losses.html "FTSE 100 up as AstraZeneca gains offset commodity losses") the costs of employing a project manager. In summary, self-build projects can be extremely rewarding and can cost significantly less than if you outsourced the entire project, but only if the process is managed effectively. Finding the right contractors is essential, as is [setting realistic timelines for the project](https://www.financedigest.com/hybrid-cars-market-projected-to-rise-at-a-cagr-of-16-5-during-the-forecast-period-set-between-2016-2024-tmr.html "Hybrid Cars Market Projected To Rise At A CAGR Of 16.5% during the Forecast Period Set Between 2016-2024 | TMR"). Even the most meticulously planned projects can experience unexpected problems, and so having a third party handle the overall management could help to [reduce the associated](https://www.financedigest.com/white-bullets-collaboration-with-polands-sygnal-association-significantly-reduces-ad-funded-piracy-in-key-european-market.html "White Bullet’s collaboration with Poland’s Sygnał Association significantly reduces ad-funded piracy in key European market") stress of reworking the plan. Whatever option you choose, making sure you keep a close eye on the [budget is essentially](https://www.financedigest.com/uks-kwarteng-mini-budget-was-essential-in-resetting-debate-around-growth.html "UK’s Kwarteng: Mini budget was essential in resetting debate around growth") to ensuring that your self-build project runs smoothly. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---