Tuesday, March 10, 2009

It Costs How Much!!?!?!?!

I mean really its going to cost that much!!!

As all our loyal readers know (both of you) we've been kicking around ideas to redo our kitchen area and the top floor of the house.

To refresh, we've got a design for the kitchen area we love.
And a decent working idea for the top floor of the house.

We've recently decided that with a baby on the way that there is no way in heck that we will be able to do much (as in none) work on the house ourselves while attempting to work full time and raise a baby. To this end, we've been interviewing quality (usually meaning high-end) design-build firms to do the work for us.

In our dream we find a quality firm that we can just write a check to and everything is magically done while we maybe rent an apartment somewhere else....

And Then Reality Hit

Interviewing Design-Build firms was interesting...things like if they paid enough attention to take their shoes off when entering our house and if they paid attention to our portfolio from the last Victorian we redid ourselves were telling.

The costs these people are coming up with have totally caught my wife and I off guard. A semi-consensus view from the firms that made the short list is....


wait for it...









$500,000!!!!!!!!!!!!!!!!!!!!

That's for the top floor and the kitchen. Half a million dollars.....wow it just really blew us away...

Thing I can't understand is how in the heck are these people going to stay in business with prices like these? I don't begrudge anyone making a nice profit but wow....with the market in free fall you can buy a really decent house in Oakland for that kind of money. They are talking construction costs of like $400 /sq ft... A bathroom costs $40-60,000 dollars they say...and the $40,000 number is for a 'simple' bath..... wow...

Couldn't we get a new house built for those kinds of per sq ft numbers?

This is forcing a major rethink on our part.
All our budgets were based on two things...

  1. We'd be doing the lion-share of the work ourselves.
  2. The housing market wasn't going to completely fall on its face.

Our new situation is now causing us to rethink our future path with this house...

Yep, we're considering selling the place as-is and getting out while we still have most of our sanity. We figure we'd take a ~$200,000 bath on the house (what we could sell it for vs. what we've put into it). Heck we even hired a pro appraiser to give us 'real' numbers to help us make this decision with and THAT was more expensive than we were expecting...

One working plan is to do just that and rent a 3 bedroom place in Alameda and bide our time while the market falls and we attempt to save as much money as possible. One issue with this is that we've now decided that we REALLY only want to live in one neighborhood in Alameda-The Gold Coast- of course, and houses in that 'hood hardly ever come up for sale. Plus, finding a house that meets our needs-size, garage, shop, storage makes for even slimmer pickens.

Another idea is to just say screw it and put more money into the house than we'll ever get out of it-don't think our current 'hood will ever be a $1,000,000 house neighborhood and just stay here forever as planned and enjoy our perfect for us house in not the perfect neighborhood (but the best school district and still a great hood) on not the perfect size lot.

Yet another idea we are mulling around is still fixing the place up and keep it as a duplex, live in it for like 5 years while saving up a downpayment on the 'perfect' place and then renting the current place out...

Any thoughts loyal readers?

17 comments:

Ayse said...

I think a lot of people are just being unrealistic about this recession. They somehow see business picking up and resuming early-2008 pricing in the next year or so. Their costs are too high (especially for labour), and they can't be flexible.

A lot of these guys are the ones who were booked 2 years in advance for the last several years. When you have that kind of business, you can afford to charge half a mil for a job like yours.

I would not spend $500,000 on a renovation right now. Not that you planned to, but in my opinion that shouldn't even be on the table. I don't know what kind of budget you were considering, but if you have an idea, it'd be worth saying, "Hey, this number is very high. Where can you come down from that?"

For purely selfish reasons, I don't want you to move out of the neighborhood, but I can definitely understand the feeling of being completely over your heads with that house and the baby on the way.

The MadScientist said...

Hi Ayse,
Yep these are all the guys who were booked out 2 years...but know what? they aren't anymore they can all magically fit us into their schedule ASAP...?
What we are looking at doing now is having the pro's just do the design-permit drawings-zoning review crap and then give us a finished shell for the top floor. That would be new roof-framing-windows-dormer and then we could come in and 'finish' it. Same thing for the kitchen area-they'd put in the new windows, doors, remove the old doors and move the walls then we could finish it on our own schedule. That way maybe we could move out while all this construction is going on and then move back in with the baby afterwards.
Or maybe we can hit the lottery and buy 1304 morton....

Ayse said...

Having them shell it seems reasonable. And you're doing enough work on the place that you really do want to have somebody licensed/experienced do things like reframe part of the roof to make the dormer.

At least rental prices are being relatively reasonable right now.

You should have a big work party to get some of the finishing done. You could make it a sort of baby shower.

Auntie Sue said...

Wow! That's a HORRIBLE thing to come up against at this point in time! I'm so sorry. For whatever it's worth, my opinion would be to definitely keep the house and work on possible ways to bring the cost of the remodel down. The "shell" idea you proposed and Ayse agreed with is one good possibility although I'd feel better about it if they were charging the big bucks for the part you would no longer have them do (i.e., if what they would charge you for the plans/permits/windows/"shell"/etc was really in the ball park of what YOU think it should cost. ) Another approach would be to "silent auction" the job to whomever is willing to accept the LOWEST amount in order to get the job (from the the good ones you've already screened). As you said, they are probably desperate for business now and it's not impossible that they, like retail stores, can actually come down 50% or more on their labor charges. Or just ASK if they would do the whole job for X dollars.
Or, you might try the next level down in reputation (middle end as opposed to high end) and might possibly get lucky and find someone who is very capable and willing to do it for a lot less money. You both know enough about building a Victorian house now that I have no doubt you would be able to keep an eye on things and spot anything that you think is being done less than perfectly. I would really encourage you to try this before you rush into either giving up on the house altogether or signing a contract for $500,000.
25 years ago when we remodeled and added on to our house, we couldn't quite afford the amount the contractors were telling us either. We talked with a young contractor who had done some work for one of the neighbors that they (and we) were happy with and talked him into doing the job for a specific hourly rate for himself and a lower hourly rate for his assistants, plus we'd pay for all the lumber, cement, and other material costs. It worked out VERY well for us, although I'm not sure HE'D ever do that again. And the two rooms he added are still standing!
Good luck, guys.

Dad said...

When Irene was little, we added on the family room with a contractor that "shelled it" and I finished up the interior. That and doing some contracting work and going to school was an effort that nobody should even consider. We did it but at the end, I wasn't sure of my own name or even that of my children.

My first choice would be to rent an apartment/house and work on your place when you could. The housing market probably will not reverse itself until at least the end of next year, perhaps longer and selling now would give new meaning to "taking a bath".

L said...

Can you live in the house with baby and cat(s) without doing *any* work on the upstairs? Or perhaps any costly work? Work + baby means no time for anything else. And throwing large sums into a home right now is a losing proposition (as you well know). So the real question, to me, is whether you've done enough to take a 2- or 3-year break from expensive renovation and still live reasonably comfortably.

Good luck with the house and baby.

The MadScientist said...

L:
Nope, unfortunately we're not really at a point where we can stop and do nothing with the house...there isn't even a floor area we'd let a baby crawl on. We're basically camping on the middle floor.

Don said...

Since you already have experience with design, you could do that part yourself, OR hire a "draftsman" to help draw and get it through Building and Safety. (Like Noah Neumark, my son, who has already helped me do the same thing with an entire new house, he now lives in Oakland near Lake Merritt), and then either you or he could hire a "small time" framer/carpenter" to do the work. He might be willing to help you oversee the work, since you both have to work, and you already know him. He'd also be much more reasonable in pricing. He's currently involved with a home construction school at a nearby college, which again may evolve into something that could save you a bundle. Call Noah at 510.593.0295 and discuss this with him.

Just exactly WHAT were you thinking to get a price of 1/2 mill just for a kitchen and a bedroom? It really is "off the wall" for anyone to quote you that much unless everything is made out of gold! You need to get realistic and do what you are already used to doing, helping with the plans, details, and "some" of the supervision. If you really do work full time, all the time, then hire a retired building inspector (I'm sure there's a few around on Craigslist) to do the stupidvision and a framer-contractor that does some of the work himself. They couldn't possibly cost you the same as a design/build Corp. If you're willing to participate a little you can save a lot.

Most basic kitchen remodels should be in about the $60,000 range if there is little re-framing to do. Add in the cost of reframing as a separate cost to this. Even with the most expensive appliances you might spend another $20,000. You don't need an architect to do the design. Just submit it as an "owner-builder" and let Noah, or some other draftsman, do the drafting for you, and help you with the submission. If you are willing to take on a little of the responsibility you can save BIG.

-Don Neumark (you can call me for more info if you want to) 818.789.7537 home

neighbor said...

Send me an email, I just did something similar and I can give you our costs, what we did and the end cost.

vtsn@operamail.com

Anonymous said...

Mr. Neumark,
Did you read the post? These kids didn't go looking for a $500,000 project they went in assuming the ideal case that they could get a quality business to finish a major part of the work for them. Quality contractors cost money-you want them to use some sorta cut-rate illegal guys?
Is your son going to shepard the plans thru the design review and building permit process?
Why the snide comment on 'if you really do work all the time' This is the modern age where 60hr work weeks are not uncommon-how much hammer swinging are you going do get done with that kind of work schedule?
$60,000 for major kitchen remodel in the SF bay area? maybe 20 years ago. Quality cabinets can cost nearly that much.
Your post comes across as snide and know-it-ally and rude.

Don said...

Anonymous-

YOU'RE the one being rude! Obviously you're NOT a contractor and have limited information and some degree of ignorance regarding building. I have been a contractor for over 50 years and know current contractor's prices. You took just about everything I said wrong. Perhaps you need to re-read what I wrote. I never said they could do the entire job for $60,000. That was YOUR interpretation. I was only referring to the tear out, cabinets, and possibly the decking. I don't know where you go for cabinets, but contractors use quality custom shops that don't charge as much as going to a "kitchen store". Furthermore I would never suggest they go to an illegal contractor. There are plenty good, reliable, bonded and insured contractors that come with great recommendations out there, without having to resort to a "turn-key" design/build firm. My son is definitely qualified to design and submit the plans for them. He's worked for a number of firms not only drawing up plans but also teaching others how to use cad programs, even within the firm. None of what I said was even remotely meant to be "snide," and I was only suggesting that they participate in the design process. How could you have gotten that wrong??? Please don't be an idiot and stay off this blog. You're not helping.

-d

The MadScientist said...

Geez alright kids play nice.

Don as it turns out its probably going to be cheaper to use a Design-Build firm for the drawing of the plans for permit submittal. And if we go with a design build firm one of the things you get is an exact price to have what they designed built-which I'm not going to get elsewhere.

We're tired and don't really want to juggle the three different people.

If we go with a design-build place I think it will be net-net cheaper to have them do the construction also.

If not I'll have a completed set of plans that I can shop around to less full-featured shops.

Some Guy in Boston said...

I just wandered onto your blog by accident from another forum.

I'm in Boston, where a lot of costs are comparable to the SF area. I believe what you have received is an "F-U" price. Meaning, the contractor doesn't want the job anyway. It's like when I received a bid for $9K to replace a door. Find someone else.

Good luck.

The MadScientist said...

Boston,
Yep that thought crossed my minde also-that its the FU price...

But 3 supposedly high endish firms have given us about the same numbers? I agree that the SF Bay area probably has similar costs to boston what do you think about this $400/sq ft pricing for remodels? Does that seem crazy to you?

NP said...

We renovated our previous house and had no kitchen for 5 months while we did all the work ourselves. This is while we had a 6 month-old. We created a suitable substitute kitchen area in another part of the house and segregated the renovation area. We had the same problem, we asked for quotes and they came back so high that we were forced to do the work ourselves. It can be done.

Alternatively, why not ask as your own GC and hire subs to do the work. It won't go as quickly as having a design-build firm, but you can control the costs and pace and do some of the work yourself when you have the chance.

As another option, why not do a quick and dirty kitchen renovation. We've done that in our current house. We spent $2K on cabinetry (IKEA), did some basic plaster/drywall patching, hired plumbers to do the rough-in for the sink and dishwasher, and bought some scratch/dent appliances. This will hold us over for 5 years after which we plan to do a major kitchen renovation which will involve structural changes.

There's lots of options, certainly some that are better than taking a $200K loss on your house.

The MadScientist said...

Hello NP,
Just checked out your blog nice house.

Well we've already decided that we are not going to sell the house.

Now we are just trying to figure out what we can do with the money-time we have left.

Being our own GC can work if we sub out small specific stuff but truthfully we don't have the time to oversee a full on rebuild.

I'm still hoping that we can afford to partially go the design-build route using them to do the stuff for us that we were going to sub out anyways (the new roof and framing that is going to be required upstairs and moving-installing some windows for us).

We've already got a temporary kitchen and we can't see spending the money to make it 'nicer' just to rip it out and redo it later.

Don said...

Dear MSci,

You still might consider contacting Noah 510.593.0295 for the drafting/submittal. He's does a great job and has experience working for a reputable firm in Berkeley doing exactly what you need. He can even do finished renderings in 3D of whatever is designed.... including an interior walk-through. He'll be a LOT cheaper than a design/build firm.

-Don