Ron and Tracy Smith loved their 1950s ranch-style home, where they'd lived for almost 20 years and raised two boys. But, they dreamed of something different.

“We have always wanted a larger home,” said Tracy Smith, 54, who lives in California in the US. The couple stayed in their house long enough to accrue equity and see local property values skyrocket so felt it was the right time to upsize. “We realised our most cost-effective choice was to tear [our house] down and start from scratch,” she said.

The new house will be three stories, six bedrooms and close to 6,500 square feet (604 square metres). “If we’re lucky, our kids… will want to hang out with us in the big house with the full basement and movie theatre and gym, and bring their friends,” she said. “That’s our version of ‘empty nest’.”

The home is in the process of being built, thanks to a construction loan, and the Smiths have been surprised by all the decisions involved. “Even when you think you have made all your choices, once it’s in progress there are so many times you may second guess yourself and make changes,” Smith said.

In the US, about a quarter of homebuyers custom-built their own home in 2014, according to the National Association of Home Builders. About one in five homes in Britain are custom-built, as are more than half of homes in Germany, France and Italy.

If you’re thinking of building your next home, here are some things to consider:

What it will take: You’ll need specific ideas about the home you want, along with the fortitude to plough through decisions on everything from floor tiles to cabinet knobs to window frames.

“When I started building 38 years ago, what was called a ‘custom home’ was nothing like what it is now,” said Mickey Munir, architect and CEO of Sharif-Munir Custom Homes in Texas in the US. “So many things were standardised, people were just picking colours. Now there are endless choices and endless ways to do things and nothing is standardised. As a result, instead of hundreds of decisions there are thousands.”

How long you need to prepare: It’s probably longer than you think. Planning and building the home of your dreams is a lengthy process. “A big house could take two years,” Munir said. “It might take nine months to get the plans together and 12 to 14 months to build it. It’s all about the size and complexity.”

Many clients think you can come up with a design and then start on site.

“After watching TV programmes of people building their homes, many clients think you can come up with a design and then start on site,” said Richard Taylor, director and architect of studioEAST Chartered Architects in Perth in the UK. “There is a lengthy process of dealing with planning applications, building warrants and tendering before a confident start on site can be made.”

Do it now: Make a binder. Before you really start the process, it’s helpful to know what you like and don’t like. If you can’t clearly articulate that, start looking through home and design magazines and rip out pictures of the things that appeal to you — from architectural design to rugs and couches. Check out online resources such as Remodelista.com or Houzz.com, where you can build idea books.

“It’s one of the worst meetings I have when I sit down and the client has nothing to tell me,” said Ryan Thewes, an architect in Tennessee in the US. “I’m going to design you a house, but it’s going to be what I would design for myself, and that’s all I can do without any input from you.”

A lot of people have unrealistic budgets.

Talk to the bank. Getting a loan to build a house is trickier than getting a mortgage for a pre-existing structure. You may have to get a construction loan to cover the building costs, which might later be refinanced into a traditional mortgage. You will likely need a larger down payment — 20% or 25% — and interest rates may be higher. In all cases, you will likely need timetables, budgets, and lots of specifics to prove your loan case. Before you proceed with any architects or builders, find out what the bank needs and what kind of numbers is feasible for you.

“A lot of people have unrealistic budgets,” Thewes said. “If somebody hasn’t really spoken to a bank yet, that’s a big red flag to me.”

Consider hiring people who work together. Building a house takes a village, and professionals have often forged relationships with designers, subcontractors and others who are crucial to the building process. “Most builders that have been in the business for any length of time have a team,” Munir said. “They know what we expect from them and they know how we build our projects. If the homeowner hires everybody on their own, then they just became the project manager.”

Talk about the money. If your architect and builder aren’t clearly aware of your budget limitations, you’re eventually going to run into trouble. “Nobody has ever come to me and said, ‘I have all the money in the world, and I can’t wait to give it to you’,” said Rich Kinsman, vice president of sales for 1867 Confederation Log & Timber Frame in Ontario, Canada. “Be honest and forthcoming with your budget. We’re here to help, we want to make sure you’re getting the house you want for the money you want to invest.”

In the US, building a house costs about $125 per square foot, on average, though costs can vary greatly based on customisation. In the UK, the average self-built home costs about £146,000 ($212,620), compared to an overall average home price of £161,823 ($235,663).

Don’t buy land first. “A lot of times people just go buy a property and they have no idea that they can’t do what they want to do,” Munir said. “It’s got deed restrictions and easements. There are neighbourhoods in Dallas [Texas] that are restricted to one story.”

You may be better off getting a rough idea of the house you want and then finding a property that matches your needs.

The biggest delay in custom home building is lack of decision making ability from the homeowner.

Tweak at the beginning — and then stop. “We do sketches first,” Kinsman said. “They’re design drawings, they’re not structural. They’re strictly for ironing out the look and feel of the house. Once we get into the blueprints, those are working drawings. When people make changes to the blueprints, it drives the contractor nuts, because we were supposed to have handled that during the first stage.”

Do it later: Be decisive. “The biggest delay in custom home building is lack of decision making ability from the homeowner,” Munir said. “They get to the point where they sit on stuff and they can’t let go of the decision and that makes the project take longer.” Commit yourself to making a choice and moving on, then repeat ad nausea.

Do it smarter: Don’t forget to have fun. “There is some work involved, there’s definitely some effort, but it can be a very enjoyable experience when you’re designing your own home,” said Kinsman. “When you buy something, you’re settling on at least one aspect of it. This house is going to be perfect for you.”

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