Mark Moore graduated from Texas A&M University with a major in Agri-Business and minor in Economics. He has 25 years of banking and lending experience in all aspects, including home mortgages. He has done lending in Texas, New Mexico and Colorado and is currently Senior Vice President of Collegiate Peaks Bank in Salida, Colorado. Collegiate Peaks Bank is the largest home construction lender in the Upper Arkansas River Valley, where they try to make it easy for the borrower from construction to permanent. They place permanent mortgage financing with Affliliated Financial Group and Skyline Financial Group. They are the only bank in that region that will do financing on alternative housing. They currently have four offices, two in Chaffee County and two in the Denver area.
Q: I'm a conservation biologist and dedicated "greenie." I'm getting married next summer and moving across the country to California (central valley--hot dry summers, cool wet winters). My fiance and I are considering many different options for finding a place to live. One possibility is to build a house that is environmentally friendly. This is really our first choice, but we don't have any idea if we can afford it. I love your website! The designs are wonderful and refreshingly different. We're not really in a position to buy any blueprints because we're in very early pre-planning stages. To help us with our decision, I was wondering if you can give me an idea of how much the various designs cost to build. I understand that building costs must vary from region-to-region, but if you could give us some rough estimates of typical amounts that would be really helpful.
A: (Kelly) Like you say it is difficult to generally estimate building costs, because of regional variation, exact design requirements, amount of sweat equity labor, etc. I know that the cost of building materials has escalated considerably in the last couple of years, and when I recently asked an architect this same question, he said the average cost/sf is up around $150 these days. With careful choice of materials, compact design, some scrounging, and a willingness to do at least some of the work yourself, you can build for a lot less than this. I built my house a few years ago for about $23/sf, but I did 99% of the work and chose a rather inexpensive way of building (earthbag/papercrete hybrid).
Q: How much money would I save subcontracting my own home, verses having it done lock and key. House will be about 2300SF.
A(John Willis):It's a broad question, but I'll try to address it. The simple answer is to figure out the overhead and profit of the average builder and subtract that from the total cost. In most situations builders sell homes for 'retail', or the same amount they will appraise for. Most
people save approximately 20% because that's the approximate overhead and profit of most builders.
The devil is in the details, so here are some things to consider. If you use bank financing, they will force you to "do the right thing" which includes creating a very thorough Construction Cost Worksheet and perhaps more importantly getting a 'subject to appraisal'. That's an appraisal that says if the house you propose to build where there today, this would be it's value using the comparative approach. Whether you build it yourself or have a builder do it for you, it's possible to wind up with a house that cost more than it's worth. I've seen it happen and it's heartbreaking.
Also, consider the value of your own time. Consider that a big builder will get volume discounts on materials and have 'priority relationships' with subcontractors. An owner builder is much more likely to have problems with subs. Part of the value in hiring a builder is eliminating risk, but you pay for it.
There's an option in between. You can hire a construction consulting firm such as UBuildIt. They pass on volume discounts on materials and the benefits of 'priority relationships' with subs. They help you with costs and bids. They will dramatically limit your time commitment. And their fee usually approximates what they save you, so you get all that help and you'll still probably wind up with 20% savings (or equity). It's hard to argue with that value if you're
already considering being your own builder.
One more cautionary note. If you're considering using a construction only loan rather than a 'One Time Close' construction loan that automatically rolls to permanent financing on completion, be sure to get fully qualified for your permanent financing first! It's very conceivable to finance the construction of an 'alternative' structure, but not be able to get permanent financing on it, leaving you with a large balloon payment and no way to pay for it.
Q: May you tell me what the most cost effective way to build a home is? Do you have any information on this or on cost per square foot for homes build with certain construction materials?
A: (Kelly) I would say that the most cost effective way to build a home would be to:
1) Choose a very modest, compact design.
2) Choose a method of building that is fairly simple and doesn't require much skill.
3) Use natural materials that can be found locally for not much money.
4) Do most of the work yourself or with others who don't charge high wages.
5) Shop around for the best deals on materials and supplies.
6) Where appropriate consider using used or recycled materials.
7) Do the building as you can afford it, so that you are not paying high interest on borrowed money.
I do not have information about the cost per square foot for homes built with certain construction materials. This would take some research on the materials available in your region and analyzing their costs.
Q: My wife and I are looking at purchasing a 6 acre lot (heavily wooded) in the Blue Ridge Mountains of Virginia. The land is at my best guess between 20 - 30 degrees in slope. I am a bit concerned about the cost of excavating such a property to build a home on. Can you give some idea what what I might be up against?
A: (Kelly) The amount of excavation necessary depends on the design and placement of the house. If your slope is generally facing south, you are in luck and can use this to your advantage in digging into the hillside to have a bermed house that fits naturally into the landscape, with passive solar features. As far the cost to do this, you would need to consult a local excavator for an estimate. This sort of work is rarely more than a few thousand dollars.
Q: I am a Construction Science major at Texas A&M, and I am doing a final project in which I write a paper on how to reduce the costs of an existing home. I'm supposed to re-design an existing home, or 2 or 3 aspects of it, that in turn will be a creative way to sell homes in a slumping house market. I am supposed to value engineer the home through design, construction methods, materials, etc. My first thought was to improve the home by "green" improvements that would most likely be initially higher in cost but save money in the end through energy efficiencies. What such "green" energy-efficient additives could I add to a residential home?
A: (Kelly) Adhering to the principles of good passive solar design could increase the comfort and economy of the home over time: appropriately sized and shaded south-facing windows, with relatively fewer windows to the other directions; excellent insulation of the entire shell of the home; the inclusion of a considerable amount of thermal mass on the inside; solar water heaters on the roof pay for themselves rather quickly and are very effective; although more expensive, the addition of PV shingles or panels for the production of electricity will offset the electric bill; choose energy-effcient appliances throughout the house; use compact fluorescent lighting throughout...these are some ideas.
Q: I was wondering how much a firm would charge for a loan that is intended for the building of an earthship?
A: (Kelly) Construction loans (if you can get one for an Earthship) vary quite a bit. Sometimes they are of short duration, just long enough to actually build the house, and then once it is built, a regular mortgage is issued for the house. You need to check with any potential lender for their policies and prices.
Q: My son and I are disabled and just purchased a new home for $83,400 and found we were majorly taken advantaged of by the USDA Rural housing program. We have over 80,500 in damages. All electric, plumbing, septic, furnace and water heater were all illegal and out of code. Black mold and broken foundation. We are living in Ky. and we have no heat or hot water. Our home right now is 29 deg. our pipes have frozen. We can not sue them because they have government immunity. We are stuck paying for a home that's being condemned. So we are looking for a great way to build us a home, but inexpensive and green. We are desperate. Our income a month is $1300 together (both of us are disabled). Please, any advice for us would be greatly appreciated.
A: (Gary Reed) What a terribly sad situation! You obviously need something quite inexpensive and fast to assemble. One possibility that occurs to me is a yurt. These round buildings can be purchased as kits and assembled within a few days. If you can afford an insulated model, you should be able to keep comfortable in KY. I have a page about these, with lists of manufacturers around the US: here.
Another approach would be to investigate shipping container homes. I wrote an article about these, although I would expect that this would ultimately cost more than a yurt. Another way to go, would be to look for a repossessed manufactured home. There are probably several of these in your area, and they can be exceptionally good deals...and you can have one moved to your property and be living in it very quickly. I hope you have better luck with this than you had with the house you bought!
Q: I have read that some houses built with straw cost close to as much for a regular house due to the amount of wood used in building. If there is a way to build the house for less, please let me know how we could do that.
A: (Owen Geiger) Construction prices get confusing because people are usually not comparing apples to apples. It all depends on how you build. A contractor-built house will cost more than if you do it yourself. A house with lots of interior walls will cost more than one with an open layout. A code approved house will cost more than one that isn't. A house with all new materials will cost more than one with lots of recycled materials. A house with lots of amenities will cost more than one without. See? Generalizations like "strawbale is more than X" are not very useful.
The cost of cob, strawbale and earthbag walls are nearly the same -- all are dirt cheap if you use local materials. Walls make up about 15% of the cost of a home. So about 85% is going toward other expenses -- electrical, plumbing, windows, etc. This 85% is the part of the budget you need to focus on once you've decided on a low cost wall system like cob, strawbale or earthbags.
Here are some huge money saving opportunities: earth floors, earthbag foundations, doing your own plumbing and electric, building in a rural area with no or few codes, using recycled materials, bartering, building small, earth plaster, building on a site where utilities are already installed (ex: tow away a trailer house and build a natural house in its place).
Strawbale is by far the fastest construction method of the three mentioned above, even if you have a tractor to mix cob. And tractors cost money to operate, so there's another expense. So bales cost a little more than earth, but now you're paying for a tractor. So the bottom line is you need to settle on a small, simple plan and do an accurate cost estimate. With a tractor, cob would take weeks of work versus a couple days to stack bales. You'll have months of work on other parts of the house. Why spend so much extra time on the walls?
Q: I need information regarding an earthquake proof and hurricane proof house on a low budget.
A: (Kelly) You might consider shipping container-based housing, as described at here. Also, domes tend to be very resistant to these natural events, and can be built with various materials, such as earthbags, as described at www.earthbagbuilding.com Another option would be a hybrid vaulted structure like this.
Q: Here is our situation: our home burned to the ground 2 weeks ago in the middle of the night (got out by the skin of our teeth!) We are not interested in re-building on the existing land because it is so far away from work. This is our opportunity to build a rammed earth home or a cob home, or some other alternative building, like we have always dreamed of. After insurance pays off the mortgage, we will have about $70,000 cash to use for the venture. Plus we have some savings. How much does an alternative house - about 1800 square feet - cost? I know, I know, the variables are endless. But is it feasible that we could build for $60-$80,000 if we make good choices? We are not handy and could not do more than help in a minor way to build it ourselves - plus we work a lot of hours. I would be so grateful for any directional help you can be.
A: (Gary Reed) The cost of building varies somewhat from region to region, but most plans can be built for no more than the average building cost per square foot for new construction in your area. You can ask local realtors, contractors, or bankers for this information. Some of the designs that call for expensive solar equipment might cost more; some of the designs that use simple earthen concepts might cost less. Other factors, such as how much you are willing to do yourself and how good you might be at finding good deals on building supplies, can make a difference...so in other words, it all depends....
It sounds like you would not be doing much of the work yourselves, so this means it would be more expensive for sure. There are some directories of green professionals listed partway down the home page, where you might find some local builders to talk to about various possibilities. Also we have quite a few green home plans listed at www.dreamgreenhomes.com . Many of these are quite small (which is one key to keeping your home affordable). I doubt if you can get any 1800 s.f. home built for $60-$80,000, unless you are very good at manifesting.
Q: Owen states that if a build is done with lots of DIY one can build an earthbag home for about $10/sf. I am researching just insulation and I don't see how that number can be correct. I know you had said, I believe, $16/sf for your house that was built several years ago. I have $20,000 budget for a 400sf house. I am going to do as much as I can myself, but I am just trying to wrap my head around what is really realistic.
A: (Kelly) With earthbag, strawbale, or cordwood building, the insualtion can be part of the wall structure itself. I think it would be possible to build a very nice 400 sf home for $20,000.
C: I was feeling a little smug about our roundhouse only costing about $2,000. Last night they showed a $100 adobe house in a nearby city of about the same size, but square with steep thatched roof. They did everything themselves -- digging local soil, making their own adobes and thatch, etc.
A: (Kelly) I think that adobe is perhaps the only material where this is possible. I know that a friend built a very nice little circular adobe house in New Mexico for under $1,000. He had a manual ram for pressing blocks, and the soil on his property was perfect to use by just moistening it the night before pressing. Doors and windows were recycled. A central adobe column supported the pole-framed roof made with pallet boards, plastic and soil. It was charming.
Q: I was looking at the modular pods and wondering if you could really do this for $3000 to $10,000. My fiance and I are looking into buying some land in northern CA to build a home like this. He does construction but is just starting to learn this more green home building. If we did some or most of this ourselves, how much of these costs are labor and how much materials? We don't have much money but want to live on our own. we are simple monastic types so we feel big homes are a waste of money.
A: (Owen Geiger) You can build at $10/sq. ft., but this is probably the lowest possible cost using 100% DIY labor, recycled materials, locally available soil, wood from the forest, no or few building codes, etc. Not everyone wants to go this route, but it's good to know the rock bottom price and then you can adjust the costs from there. Add extra for any hired labor, etc. It's all up to you.
I don't have a materials/labor cost percentage to give you. Building with natural materials is labor intensive. It's much easier to grab some 2x4s and nail them together. But then again, we're talking about an entirely different type of house. Again, each individual has to decide what they want: 1. quick and easy (which usually equates to costly manufactured goods and a more sterile manufactured looking home) or 2. more time and labor intensive processing of natural materials (which tends to create an earthy, safe, cozy home).
Q: We are totally committed to building our earthbag home, and not only that, we want to have a community of 4 or 5 homes on about 20-40 acres. We plan on being totally sustainable if at all possible. We are doing this as an experimental project to show people that you can use the earth we have to build without spending a fortune and negatively impacting the environment. We already have all of the community members ready to start. We are just missing the funding. That is why I am writing you. We want to see if you know of ways to fund a project like this? We plan on using solar and wind power and natural septic. Any advice you can give us will help. We just have a burning passion to get started and make this change, we just need some help finding the funding.
A: (Kelly) I'm glad your are wanting to build an ecological community, and using earthbags can be an excellent way to do this. Yes, it is possible to build cheaply, but this requires work...not only the labor in building, but also the effort to locate inexpensive components, often as recycled items.
Obviously, it does take some capital to gather together what you need, and this is the challenge that everybody faces when starting such a project. Your community will not only need the funds to start building, but will also need some way to develop a sustainable economy as time moves forward. It may be that your next objective is for all of you to focus on saving enough money to at least get started with your project. There is much to be gained by staying out of debt, and I encourage you to try to do this. Perhaps patience and hard work are in order...
Q: Of all the building methods you recommend, which is the cheapest? Also need to insulate against cold.
A: (Kelly) In terms of building walls, which only comprise a fraction of the cost of building any house, it depends on what is available locally. If you have good cordwood, strawbales, or volcanic stone nearby, then those might be the cheapest materials to use. When volcanic stone is crushed and put in earthbags, it can be quite insulating, along with strawbales or cordwood.