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| Can You Beat the System? |
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| By Jim Cooper |
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In the course of selling log homes, I've heard some creative schemes for saving money. One of the more popular is: "I don't want a log home package. Just sell me the logs and I'll take care of the rest."
Sometimes shoppers simply can't find exactly what they want, so they see a solution in buying individual components. But many times the log home hopefuls believe that by buying individual components, they have found a way to beat the high cost of new housing. (Notice that I said "housing," not "log housing;" everybody, not just log home enthusiasts, thinks houses cost too much.)
Usually such reasoning is founded on two assumptions. First, a chunk of a full log home package price is profit for the manufacturer. Second, this money represents instant savings to the home buyer who shops for the individual kit components and buys mostly from local suppliers. While the first assumption is partially true (businesses that don't make a profit have a nasty habit of disappearing), the second assumption can lead the unwary log home buyer down the primrose path and into a dark alley where our old friend Murphy and his wicked little law lie in wait. Before trying to outwit the laws of economics, let's look at what can happen.
Most log homes today are offered as a building "system." That is, the manufacturer offers an integrated package of materials and services. Components, such as logs, fasteners, seals and roof beams within the manufacturer's package are designed to work together. Supporting services, such as design and blueprint preparation, are adapted to the specific components and construction methods of the individual manufacturer. For example, one manufacturer may use a specific type of seal that works well with the company's wood species and log profile. On another manufacturer's log, the seals may perform miserably or not at all. Building a log home from components whose only common characteristic is that they were the cheapest available may turn out to be very false economy.
There are other ways that trying to beat the system can backfire. Let's look at what is included in the price of a typical log home package. Most full log home packages include four things: design services; materials list; materials such as logs, windows, doors, shingles, lumber (the exact materials included vary among manufacturers); and construction assistance, ranging from a construction manual to a toll-free consultation number to site visits to actual construction. All of these components are part of the log home manufacturer's building "system."
What do the components contribute to the manufacturer's system? Let's delete them from the log package and see what might happen. When you announce that you want only the logs, one of the things you often sacrifice is design services. In some cases, you may get limited assistance, such as construction drawings showing only the log walls. Since you are purchasing materials instead of a package, you will probably not get full blueprints unless you pay additional fees. Financial institutions and building code requirements in most areas dictate complete blueprint sets, so you have to go shopping for interior framing plans, elevation drawings, roof framing, foundation plans and electrical plans.
To keep costs down, you may hire a local draftsman to prepare your drawings. Herein lie two potential money traps. First, unless the local draftsman is familiar with the logs you have selected and other components of the log system, chances are the drawings are going to leave you or your builder alternately mystified and aggravated. Be prepared to change builders or face added charges if the blueprints result in time delays and repeated modification.
In many areas, drawings must be "sealed" (signed and stamped) by a registered architect or engineer to meet local building regulations. This means finding and paying an architect or engineer either to review the drawings and stamp them or to prepare them. Unless you are dealing with close family members willing to donate their professional time out of the goodness of their hearts, chances are you have just paid as much as, or more than, the price the manufacturer includes for those services. In addition, you have transferred the headaches of dealing with the building permit bureaucracy from the manufacturer to yourself.
Be aware that not all manufacturers include signed and stamped construction drawings in their package price. However, the cost of sealing them is usually much less through a manufacturer because, even if it doesn't employ engineers and architects, it usually has access to their services at a rate far less than what you would pay directly.
The materials list offers the second major area of hidden pitfalls. When you buy individual materials rather than a log package, you usually sacrifice the complete materials list prepared by the manufacturer. This lays two more potentially costly traps. First, you must prepare or pay for preparation of a complete list of materials required for constructing the house. Your cost for a professionally prepared materials list will almost certainly exceed the cost included in the manufacturer's package price. Also, the final product will be only as good as the preparer's understanding of the construction requirements (which depends in part on the quality of the blueprints and the draftsman's understanding of the building system).
An incomplete materials list leads directly to inaccurate estimates of the house's cost. In addition to low materials price estimates, it may lead to unrealistically low bids from builders. If a builder prepares a roof framing bid based on a roof containing 40 sheets of plywood and then discovers that someone forgot to include on the materials list the other 40 sheets for the back side of the roof, it's not likely that he will graciously "eat" the additional labor. Preparing materials lists is an exacting process requiring great familiarity with blueprints, construction methods, specific log systems and construction material specifications. Trying to save a few dollars by relying on seat-of-the-pants estimates of material needs can bring costly results.
After the materials list comes the materials themselves. Many manufacturers offer, in addition to a full materials package, a "log wall package" that includes only the logs, fasteners, seals and perhaps timber beams for roofs and floors. "These are the logs I want, but why should I pay for shipping 2-by-4s and plywood and windows from Timbuktu?" goes the refrain. "They have to be cheaper from a local lumber yard." The correct response is, "Not necessarily."
When I started building log homes, I built a couple of "spec" houses. Rather than buy full log packages, I bought only logs and beams and got the remainder of the materials locally. After those houses, I did a thorough cost analysis. With the time and aggravation I went through preparing the materials list, I wanted to be sure I was saving money before using that approach again. I sent the materials list for an upcoming project to three local building supply companies and compared the results with the full log package from the log manufacturer.
Surprise! It actually cost almost a thousand dollars more to purchase most materials locally.
How is this possible? I talked with a friend who owns a lumberyard, and he introduced me to the power of buying in bulk. Most log manufacturers have negotiated contracts on large quantities of materials--windows by the truckload and lumber by the train car load. They purchase at prices far below those that an individual or small builder could obtain from a local supplier. Depending on the shipping distance from the log manufacturer, the delivered price of a full log home package may be less than the cost of the individual components obtained locally. This doesn't take into account the shopping and bid review time, not to mention the individual delivery charges or the time required to pick up items from a variety of local vendors.
Finally, there is the construction itself. Many manufacturers offer some sort of construction support with the purchase of a complete log package. The most basic is a construction manual written for the manufacturer's specific system. As with construction drawings, turning away from the manufacturer's system reduces the utility of the construction manual and may even result in errors. For example, the seals included with the log package may have been included because of the way they respond to shrinkage and settlement with the manufacturer's log system. Building using the methods outlined in the construction manual but with materials other than those for which the system was designed may compromise the quality, energy efficiency or structural integrity of the home.
Also, using components other than those included by the manufacturer in their system usually voids any warranty. In such situations, the home buyer has no recourse should problems arise.
So is it ever an advantage to go outside the manufacturer's system and purchase individual materials directly? Absolutely. Here are the circumstances when you can reasonably expect to save money by doing it all yourself:
• You are a log home construction expert. You can estimate within 2 percent accuracy the cost of a completed house and can accurately determine from a set of blueprints the quantity, size and grade of every piece of lumber in the house.
• You have an enormous amount of free time to educate yourself and negotiate with building materials vendors. Eight 16-hour days per week for at least a year should about do it.
• Someone in your immediate family owns a building supply company. |
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