Building Custom Homes
As Anne and Kevin Boyce’s children grew, the Falls Church couple recognized that their beloved home seemed to shrink and their hilly, nearly nonexistent yard didn’t offer space for outdoor play.
Like many local buyers, they wanted to stay in their neighborhood, where they have friends and participate in community activities throughout the year, but they couldn’t find a home to match their wish list.
“We were so lucky because a woman who owned a home on a nice half-acre lot around the corner from us wanted to move to Leesburg to be closer to her grandchildren, ” Anne Boyce says. “We bought the house as a teardown and then were initially overwhelmed at the idea of designing a custom home.”
Building such a home requires a vision and patience as well as an experienced team of professionals who can provide buyers with advice throughout the process, which can take more than a year, depending on the condition of the lot and the architecture of the home. The design and permitting phase generally takes six months, and building can take 10 months to a year; the Boyces’ home took approximately 16 months to design and build.
Although custom homes often are among the more-expensive dwellings in the Washington region, they can be built to meet the budget needs of people seeking to spend a lot less than $1 million. Some smaller, simpler homes can be built to a buyer’s specification for as little as $400, 000, depending on the cost of the lot and materials chosen.
“You can do a $5, 000 Ikea kitchen in a custom home or spend $60, 000 on just the cabinets, ” says George Myers, who is president of GTM Architects in Bethesda and who built the Boyces’ home. “It’s important to be upfront about this from the start and show buyers a high, middle and low option so they decide where they want to spend their money.”
Myers says a 4, 000-square-foot custom home, with a 1, 500-square-foot finished basement, in the D.C. area is typically priced in the 0, 000 to .2 million range.
“We draw up plans based on a wish list and come up with a price, ” Myers says. “If it needs to be 15 percent less, then we start to look at which materials to swap out to reduce the cost.”
To minimize sticker shock, says Jonathan Lerner, chief executive of Meridian Homes in Bethesda, it’s best to have the builder involved during the design process to talk about what different choices will cost.
Start with the land
Some custom-home buyers already own a lot, but many rely on a builder or realty agent to help them find one.
“The choice of lot needs to take into consideration the neighborhood where you want to live, the size of the lot and the home you want to build, whether it has trees or a stream and whether it’s hilly or flat, ” says Joshua Baker, founder and co-chairman of BOWA Builders in McLean. “We do a feasibility study to determine the ramifications of a particular lot for construction purposes and research any governmental and deed restrictions that could impact the project.”
Builders often have an easier time finding a lot because they hear about the ones that have yet to be put on the public market, Lerner says.
“We know about local regulations and we hire a civil engineer, so we know before we start building if there are site-specific issues or impact fees, ” he says.
Sometimes zoning restrictions on the configuration of a site won’t allow for a three-car garage or a home with a large footprint.
John Joy, owner of Joy Custom Design Build in McLean, says he and his wife, Lisa Joy, a real estate agent with McEnearney Associates, find the lot for 90 percent of their customers. Home sellers and their agents often contact them directly when they anticipate that their home will be a teardown, one that’s more valuable for the land than the home.
“It’s much less costly to tear down a home and start from scratch rather than try to save part of the home, ” Lisa Joy says.
While tearing down a home to start fresh is cost-effective for the buyers and, Lisa Joy says, fine with sellers who want the best price for their home, sometimes neighbors are less enthusiastic about teardowns. In neighborhoods across the area — including Bethesda and Chevy Chase in Maryland; Forest Hills, Wesley Heights and Massachusetts Avenue Heights in Washington; and Arlington, McLean and Falls Church in Virginia — neighbors have occasionally banded together to stop a builder from tearing down a home, but they rarely are able to prevent that from happening.
“Teardowns are so common in most neighborhoods inside the Beltway that we haven’t had very many complaints, ” Lisa Joy says. “We put our phone number right on our signs so that neighbors can contact us directly with concerns or complaints, and we’re very responsive.”
Lisa Joy says that they talk to the neighbors personally and explain what will be built. Most people understand that today’s buyers want high ceilings, large windows and open floor plans, which are hard to get by simply remodeling, she says.
“The more people realize that a new, custom home in their neighborhood raises everyone’s property values, the more accepting they are of a teardown, ” she says.
The central family room features a stone fireplace, beams within the coffered ceiling, two sets of French doors to the screened porch along the back of the home and a connection to the kitchen. (Photo by Ken Wyner)
Financing the home
John Joy says their custom homes cost an average of $3.5 million but can cost as much as $8 million. He says that about half of their customers pays cash, a fourth pays cash for the lot and finances the construction of the home, and the other fourth finances the entire purchase with a down payment of 20 to 25 percent.
“Few lenders offer construction loans because they aren’t sold to Fannie Mae or Freddie Mac, ” says Michael Johnston, vice president and branch manager of Howard Bank in Timonium, Md. “The lender needs to understand the construction process and communicate with an appraiser about the value of the land and the future home.”