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Budget Reduction – Results from Builder & Architect Meeting

by Chad Ludeman on August 7, 2008 · 32 comments

in budget,Development

This Monday, Brian and May from ISA met with Scott from Build It Green Philly to brainstorm final cost reductions that could be made prior to finalizing the construction drawings. The team came up with some good recommendations for cost cutting that get us another big jump towards our goal. Some of the cuts are a bit painful, but we all agree they are necessary while not compromising the design to a point that we are no longer comfortable with.

I have thought about the list and made a few decisions and minor modifications to come up with the final list you see below:

  • Eliminate the kitchen island [$1,000]
  • Use a single drop-in range rather than separate appliances [$800]
  • Use $2 psf tile allowance in the bathroom rather than $5 psf [$300]
  • Eliminate Hardi on the rear, side wall and replace with stucco [$800]
  • Reduce # of outlets [$200]
  • Remove entire closet in Master Bedroom [$1,000]
  • Eliminate one window at ground floor, North facade [$400]
  • Eliminate washer/dryer from case study (will remain in bank budget) [$1,400]

Total Savings: $ 5,900

New Construction Total: $103,315

The most painful changes in here for me are the kitchen modifications. It was suggested by a reader (dream) to make these changes in our previous post on appliance budget reductions and I had replied that we had considered but really wanted to keep the separate oven and cooktop to beef up the design. While it hurts a bit to simplify the kitchen, it is the smart decision and it will also simplify and reduce the cost of the range hood ventilation by being able to mount it to the wall now. Also, we can maintain the functionality of the island layout by replacing the permanent island with a moveable SS kitchen worktable that can be bought from a local kitchen supply store for under $250.

Another modification that may pique some interest is removing the closet altogether from the Master Bedroom. This is something we discuss early on while questioning what is really necessary in a home. A built-in closet could be seen as an upgrade and often people like to purchase and customize their own clothes storage units for their bedrooms. I simple unit from IKEA or even a DIY system (I have some ideas for this)  may be a nice option. Again, this is for the basic $100K house model in the case study only. I realize that most may choose a closet “upgrade” if given the chance and we would also most likely put one in homes we intend to sell such as the 120K house next door.

The last major tweek on here worth talking about is the washer/dryer. While I still want to include this in the home and the budget for the bank, I am again taking the advice of the readers and removing it from the case study budget figure. This appliance really is not required in a new home and is included many times today as a gift or added feature by the developer.

Scott is currently reviewing the final construction drawings with all of his subs to nail down the final figure. We will meet mid next week to review what he has come up with and discuss final cost reductions if still necessary at that point. I am very pleased with the progress we have made on the budget in the past few weeks and would not view achieving anything under $105K as a failure. In the end, this may not be the $100K house in reality and there may be fundamental design tweeks to be made to the plans that we simply can not make at this stage of the project. That’s OK with us and was one of the reasons for the experiment in the first place.


Updated Construction Budget

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{ 32 comments… read them below or add one }

1 The Wallbanger August 7, 2008 at 11:41 am

So close!

2 Rob August 7, 2008 at 12:34 pm

While I can agree with most of the proposed changes, I find it hard to think that I could buy a new house without a closet in the master bedroom. I will have to thingk about this one. That being said what is being proposed here is far and away better than the typical home built in this country. The investment being made in the envelope and HVAC systems are more than enough to make up for slight increase in costs as operating costs are going to be signifigantly reduced. Even if the 100k house cost 120k, it would be a steal!

3 Mike August 7, 2008 at 2:24 pm

While you don’t say exactly how many or where you’re removing them from, I would suggest you reconsider reducing the number of power points.
Having the power points provides versatility and adaptability, allowing you to re-purpose areas in the home over time. While you don’t want to go crazy adding them everywhere, think about how you will use the room now and in the future before deciding to remove one. It seems like a false economy to limit your options for the sake of $200 dollars.

4 moderns-r-us August 7, 2008 at 3:15 pm

All of this ongoing discussion about the “optional” appliances reminds me of a discussion that I had with my realtor (for full disclosure I must admit my realtor is my mother-in-law and is looking out for our best interests more than most realtors would). She warned us about the financial soundness of putting “optional” appliances into the cost of the house/mortgage.

The argument goes like this: Why put an appliance that is going to last 10 years into a thirty year mortgage. You will be paying for the principal and interest on these appliances long after they are in the junkyard…. excuse me recycle yard.

You would be better off buying the appliances on credit at 18 percent and paying them off in two or three years.

Just another angle on the appliance question.

5 moderns-r-us August 7, 2008 at 3:27 pm


It seems that the last time I was in Ikea I saw a table with a cheap stainless steel top that was meant to be a kitchen island.

It feels like taking out a master bedroom closet and then offering it back as an upgrade to meet the budget is just semantics. Will the bank/appraiser count this as a bedroom without the closet? A basic Ikea wardrobe may be available for the price of your sliding closet doors.

6 lavardera August 7, 2008 at 4:51 pm

A closet built with walls is 2′-4.5″ deep (generally) where as a piece of casework, Ikea or otherwise, is usually 2′ or less. It also gives you better access to your storage space and more configuration options from the start. Why give up 6″ of floor space for a less flexible closet.

More important, I’m curious whether any of these changes such as Ikea kitchen cabinets rather than locally made cabinets had a meaningful impact on the LEED calculation?

7 Frank August 7, 2008 at 5:07 pm

In keeping with the ‘green’ concept, would it be possible to use architectural salvage kitchen cabinets, and other materials, doors, closet hardward to further save money and push the ‘reuse’ concept in your project.

8 tracy August 7, 2008 at 5:13 pm

um…if i were signing up for a 100K home and then learned a closet in the master was “optional”, that would not be cool. i would feel a bit tricked.

i know you basically boxed yourself in when you named the project the 100K house but, to your point in the last paragraph, is the goal to make modern, green housing at a very affordable price or is the goal, come hell or high water, to have it hit 100K?

i understand the custom cabinets to Ikea type decisions but I don’t understand functionality decisions because they not only prove to be some sort of added separate cost anyway to the buyer but they will reduce the resale value.

9 tracy August 7, 2008 at 5:17 pm

oh, and the closet thing would likely be bad PR. when you start to shop this story to the media, they’d likely point out that with the 100K house, you don’t get a master bedroom closet and that’s going to turn people off and make them wonder what other functional staples might be missing.

10 lavardera August 7, 2008 at 5:37 pm

I disagree. Framed and plastered closets are cultural baggage just like SUVs. When the house is resold some day the casework closets remain. Maybe if you were in Sweden where everybody does and expects to use casework you would have a reason to take your closets with you, and it would not matter because the next person would bring their own closets. But here in the US you leave them behind, no hit on resale value. People have to let go of these hang ups.

11 tracy August 7, 2008 at 5:43 pm

lavardera…debate is good and we can agree to disagree! i’ll look for a bumper sticker that says i heart cultural baggage or a tshirt that says closets are hang ups, ok?

12 eikoh August 7, 2008 at 6:04 pm

The biggest shame is the removal of the Hardi. It kills the exterior, makes it less unique, and eliminates the pattern created with the panels & windows. If you are willing to take this step, why not go all the way and remove the Hardi from the front too. Then call the house a stucco box with a funky window configuration, which can also be a cool concept. The thought of only the front facade being treated with the “special” material sounds way too familiar..

13 tracy August 7, 2008 at 7:39 pm

and by the way, i hope lavardera and others get that my post #11 is meant to be silly at the end.

i truly believe debate is good, gives us more fuel to think things through. this is an important project to push the boundaries on what we think is possible and it’s good to think in new ways, as lavardera was suggesting.

our energy crisis is not a quick fix, it’s a lifestyle change, a mindset shift. and with folks like Postgreen and their expanded team challenging themselves, we all will learn to expand our vision on things. and that’s so valuable right now.

14 chad August 7, 2008 at 7:46 pm

I like the discussion that is going on here. I won’t comment directly on anyone’s specific point as I think the discussion is great as is. I will say that I am a bit concerned that we are cutting out some ISA design elements that I feel we need. We are going to have to take a hard look at the builder’s budget in the next week to make sure we aren’t making cuts that really could be afforded if we just sharpened our pencils a bit more…

Also, I will throw this idea out there. Maybe this will be a future post but I think there is a market for an almost completely bare green home that has a kick-ass envelope and HVAC system installed. Throw in a kitchen sink and stove to get past code and let the client pick out and install their own kitchen, bath, closets, flooring and other miscellaneous finishes. This is the DIY era and everyone has different tastes and budgets. It would work. I’m pretty sure.

15 lavardera August 7, 2008 at 7:59 pm

I’m with you tracy all the way! :)

16 moderns-r-us August 7, 2008 at 8:00 pm

From lavadera “More important, I’m curious whether any of these changes such as Ikea kitchen cabinets rather than locally made cabinets had a meaningful impact on the LEED calculation?”

I have been wondering the same thing.

17 chad August 7, 2008 at 8:14 pm

The short answer to the LEED question is no. We might lose half a point by going to IKEA but it’s not going to break the bank. I need to review our LEED sheet again to post more intelligently on this. Thanks for the comment.

18 moderns-r-us August 7, 2008 at 8:16 pm

Since we are talking about the infill lot, not the corner lot and since you already have stucco on the back of both row houses, I think making the little patch of rear side wall of the house stucco to match the rest is a reasonable thing to do. Besides no one will be able to see this and any of the front walls at the same time.

19 roxanne August 7, 2008 at 9:59 pm

Gotta throw in my 2 cents…. Have you explored all the opportunities for cost savings in windows?? We found quite a bit of savings by reducing the number of operable windows and combining smaller windows together into larger openings. I was amazed at the savings we realized and with no “pain” inflicted on the final design. Put them where they are most important- for both daylighting and air-flow.
I would hesitate to change the siding to stucco. I think you would regret those minimal savings from such a drastic change.
The standard 2′-4″ deep closet with sliders are a dated idea. (sorry Tracy, I’m totally with LaVardera on this one!)

20 tracy August 7, 2008 at 10:07 pm

ok…so what’s a modern way to keep clothes for 2 adults in a bedroom? cause one wardrobe ain’t gonna do the job well. i’m curious. i want to learn what the better alternatives are.

21 moderns-r-us August 7, 2008 at 10:08 pm

answer: two side-by-side wardrobes!

22 tracy August 7, 2008 at 11:11 pm

lol…ah, ok. i guess i feel like there’s a certain modern and sleek aesthetic which would be about less furniture and more built in lines or “hidden” storage and such. i agree that typical closets with 2 sliding doors are not inspiring but are there any other design options?

23 moderns-r-us August 8, 2008 at 3:36 am
24 chad August 8, 2008 at 3:46 am

Nice! I was going to wait till later but here is what I plan to build and put there. Don’t tell my wife.

25 Rob August 8, 2008 at 12:08 pm

hahahahaha, Chad you are awesome! I have to say I have been persuaded by this discussion a bit. While I can see the point of wardrobes over closets, I am not a huge fan of Ikea with respect to quality and sustainablilty. And a well made wardrobe is certianly more expensive than a 2×4 framed closet. I do like the pipe closet, and in fact I have seen similar ones done with pipe and steal cable, suspending the pipe from the ceiling and tying it to the floor with the cable. They looked very sleek and modern.

26 tracy August 8, 2008 at 1:54 pm

and i like this discussion too cause it’s making me think through things more thoroughly. but i have to say i prefer something industrial looking, like Chad attached, vs. a wardrobe which, no matter the design, makes me think of something older not modern. and given money is a constraint here, you have to give that it’s due.

for me, i’m torn between wanting to make a whole wall a closet with bamboo or recycled material doors and make it a cool looking feature behind which to put clothes, and or a tv, a desk, whatever else you want in the room so that when it’s closed, the room had the bed and not much else. Vs. having the clothes out in the open with what Chad shared because i’m thinking psychologically it would help us to realize we have a lot of clothes already and hopefully stem off buying unnecessary items and we’d want to keep it neat (for guests that come by) and this would force us to look at the edit our wardrobe down more often then if stuff is buried in a closet that we can’t see and never wear.

i know this is a little off the point here but i’m realizing more and more lately that it’s not just about recycling but about consumption to begin with. on a Primetime show on China the other day, they said that if China consumed the way Americans did, we’d need another planet. that’s frigin scarey.

sorry for the digression! just figured this crowd would understand. :)

27 lavardera August 8, 2008 at 2:08 pm

I like this one:
still has to work out cheaper than studs, drywall, sliding or bifold doors…

28 chad August 8, 2008 at 2:18 pm

The bottom line here is that people have a lot of different tastes in closets or multi-use closet type space. This could be seen as another reason not to include the closet as standard equipment, especially if it’s a bare box with a rod or two thrown in.

Another point that’s worth making is that we have discussed how this initial 100K design may be come to be seen as the “loft” version in the future due to its open and minimalist design. Most lofts do not have built in closets including the one I live in.

Starting with the idea of an open loft helped the project in multiple ways. We immediately eliminated costs associated with internal doors and excess walls. We also were able to simplify the HVAC system as the house became one large zone rather than individual rooms that required expensive ducting.

In the future we may decide to create a more standard version of the 100K model with divided rooms. That doesn’t mean that closets will necessarily be standard equipment though…

29 tracy August 8, 2008 at 2:44 pm

i’m convinced! to hell with installing standard old reach-in closets…save the money in the budget…let the new owner decide. hooray! lol. :)

30 Travis August 8, 2008 at 9:51 pm

For $2/sf you could do slate in the bathroom instead of tile. Penn Big Bed Slate in Slatington, PA. This would also save labor cost over tile.

31 chad August 8, 2008 at 9:57 pm

Thanks for the tip Travis, but I’m a bit confused. Wouldn’t slate just be another type of tile? How would it save on labor costs? Is there some type of install detail I am unaware of…?

32 honeybee33 January 8, 2009 at 4:36 pm

chad –

You said:

“Also, I will throw this idea out there. Maybe this will be a future post but I think there is a market for an almost completely bare green home that has a kick-ass envelope and HVAC system installed.”

To answer your question, that is almost *exactly* what my husband and I have been (unsuccessfully!) looking for here in the Boston area. We are both quite handy (construction and design-wise), have limited upfront investment resources, and specific tastes. Getting the “stripped-down” version and doing it ourselves as we can afford it is a way we can grow equity while getting the customization of a new-build. (and, we feel, more green than ripping out someone else’s granite-countertop “upgrade” … )

From your lips to G-d’s ears!

~ hb33 ~

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