Single Fam Vs Commercial New Construction Timeframe

7 Replies

Just Curious, maybe the more experienced investors can shed some light on this : Why does residential, single family new construction take ages to come to fruition while commercial moves quick?

 Or is it something that happens in my area ( Massachusetts) ?  I see new construction spec builders take months to move from one stage to the next while commercial buildings are framed and roofed sometimes in days. why the disparity?

Follow the money!!!!   I am a contractor in Mass.  There are some residential builders that move just as quickly as the commercial builders.  It all depends on if their houses are selling quickly and if they are paying their contractors fair prices.  Some builders take their time because they dont want to pay top dollar for the quality contractors.  A good contractor will get the job done fast and the quality of the workmanship will be perfect.  Builders pay a premium for these contractors.  There are also contractors that do a good quality job, but take a long time.  These guys usually work for less money and aren't as popular with commercial builders, given their time constraints and bigger budgets.  If you head towards boston, you will find residential contractors and builders who move much faster.  The builders are selling at a higher price, so they can afford the better "subs"!!!

Interesting observation, Michael.

On a slightly different note, do you know of any contractors that would do small, mostly indoor cosmetic work?  I'm closing on a property in Haverhill that has some minor dry wall and plaster repair, installation of fans, changing plumbing fixtures, install backsplash in kitchen, painting, etc.

@Danny N. There could be a variety of reasons for time frames on jobs. Permitting process and inspections, utilities and their time frames for hooking up, changes made to plans (in residential buyers are much more emotionally invested than commercial, and make changes more often, commercial is much more cost and time focused) 

We are building a house in San Clemente, and it is the longest build we have ever worked on in 30 years. Why? First we had to completely redesign the house because though the seller of the land had a plan approved beforehand, when we were going to move forward with the basic concept we didn't want the specific plan (garage at rear accessed from alley) the City realized there had been a change in code and that was no longer possible. Then once we were approved and began construction, the neighbor to the back of us sued wanting to gain ownership of the easement that went with our land. We defended it, and it cost us a lot of money, and months worth of time. We pay interest on money we use on our loan, and with lawsuit in progress we didn't want to be racking up interest on a project that was held up, so we waited to start up again until lawsuit was settled.  

So... each project has its own set of circumstances. Though, commercial is much less complicated in my opinion than houses. 

Originally posted by @Nnena O. :

Interesting observation, Michael.

On a slightly different note, do you know of any contractors that would do small, mostly indoor cosmetic work?  I'm closing on a property in Haverhill that has some minor dry wall and plaster repair, installation of fans, changing plumbing fixtures, install backsplash in kitchen, painting, etc.

 It's not always true, some pay top dollar and still get a crappy contractor. If that happens, you pay top dollar price. And you shouldn't ask a contractor for recommendations who he could refer, he will just present himself.

Originally posted by @Danny N. :

Just Curious, maybe the more experienced investors can shed some light on this : Why does residential, single family new construction take ages to come to fruition while commercial moves quick?

 Or is it something that happens in my area ( Massachusetts) ?  I see new construction spec builders take months to move from one stage to the next while commercial buildings are framed and roofed sometimes in days. why the disparity?

 Commercials have lesser COs, unless it is a code compliant issues, there is no reason to change the approved plans. Unless you hire a crazy architect. Also, residential construction have a more lesser caliber of contractors, they also sometimes carry more costs, some of them don't bill until the job is done. Some just have the cash or a lender behind them. I have a sub that I use who has multiple licenses and is basically a 3 man crew, i wanted to give the contract to him but after he insisted 3 times that he will do the job in 3 weeks by himself plus two others what would take  a 1 week job of mine with 8 guys, I decide to award it to another contractor. His reason? He won't be able to pull 5 more guys and it will help him not to look for another for 2 more weeks.

Thanks for the responses Everyone. I was referring specifically to new construction spec builders. I understand that building non spec may have plenty of change orders as buyer changes his /her mind, but i still see it with lower priced generic spec builds...

@Michael Letarte I suspected it had alot to do with money. It seems commercials are more focused on time as a priority and are willing to pay top dollar for the right construction team that would get the job done right and in time. A Contractor I know told me the residential new build guys are always looking for the "best price" contractor before moving to the next stage, i.e. once foundation is laid, they bid out the framing work to the guy with cheapest price, I guess it also depends on price of home.

@Karen Margrave Those are indeed intense challenges to deal with, more like a horror story, especially dealing with the lawsuit. So I wasn't sure if you said you would move forward with construction while suit is pending or will wait it out? 

@Nnena O. are you all set with contractor? If not I may have someone

Also, time frames, etc. depend on the type of construction you are doing. If it's just basic house with simple one story floor plan that's one thing. Our job, though it's a "spec' it required a huge amount of excavation, retaining walls, etc. So the area where you are building factors into the equation too, as well as the style of the house. You can go onto my website and see our spec houses, a little more complicated than a tract house (unfortunately) We'd love to find some nice flat, affordable lots!