I plan to build a home on unimproved property that I bought in California. I would like to manage the project without hiring a general contractor. What are the requirements for managing the construction of my own home?
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Answer: (1)
A property owner that acts as
A property owner that acts as a general contractor for their own construction project is considered an owner builder. Just as there are laws that regulate the behavior of contractors, California law regulates the owner builder practice. To qualify as an owner builder in California, the project worksite must be the principal residence and the owner builder must have occupied the premises for 12 months prior to the completion of the project. An owner builder is prohibited from building and selling more than two buildings within a three-year period.
The owner builder takes on the responsibilities of the general contractor, including obtaining permits, ensuring the project passes codes and building inspections, paying subcontractors and suppliers, and managing the project in accordance with contractual obligations. An owner builder should be aware that anytime a building is altered, constructed, repaired, improved, enlarged, or demolished the owner builder must obtain a permit. Each city and county has code requirements.
Before you begin managing your construction project as an owner builder, an experienced real estate attorney can give you information about other important considerations, such as contracts, construction loans, mechanic’s lien, worker injuries, and how to avoid being considered an employer.
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Posted by Jess Mcelrath on 18 Feb 2010