Overseas construction blog part 2: Are all your ducks in a row?
This is the second of a series of posts in which David Steckler shares his experiences of building a vacation home at Hacienda Iguana resort on Nicaragua’s Pacific coast. Read the first here. The goal of this candid construction blog is to reduce the anxiety levels of people who have bought Nicaragua real estate or property elsewhere in Central America and plan to build, but are afraid of making mistakes along the way.
Are all your ducks in a row?
Before we jump into the actual construction part of this blog I’d be re-miss if I didn’t emphasise the 3 golden rules for first time builders that Steve Snider shared with me. They are:
- Have the 2 or 3 contractor/builders that you’re considering give you the names and contact information of the last 3 home owners who have used their services.
- NEVER give your contractor/builder all the money up-front!….in fact keep back at least 5 to 10 % of the total construction budget until you’ve had a chance to live there. Create a final punch list, while occupying your new house that your builder will satisfactorily resolve before final payment is made. All this needs to be clearly stipulated in the construction agreement.
- At least a one year guarantee on all workmanship from the contractor/builder and have that spelled out in the contract as well.
Note: In the contract make sure you stipulate a set construction period that penalizes the builder if they go beyond this agreed upon time line.
As mentioned in my first blog entry, consider some pre-visit due diligence before dropping down into Central America by exploring these other internet web-sites, which includes our host site. I enjoy Nica Living and Nicaragua Guide where one can hear from the expat. population living in Nicaragua. I’ve also had many productive conversations with Henkel Smith, who’s very honest and knowledgeable about the Tola region of Nicaragua. The last site I’d recommend combing through is The Real Nicaragua. It has a great overview of all the moving parts of living and investing in this Latin American country. These internet sites are specific to Nicaragua, but every country has gobs of information you can tap into on cyber space……..start by googling “forums” in your country of choice and see where that leads you!
When we last blogged, our first wire transfer payment – 30% of total cost to Horizon Group, had been sent to fund Site Prep, Materials, Bodega and Foundation work. As you can see from the photos the house foot print was surveyed, staked out and our Architect gave them the go ahead to start excavating. The temporary Bodega- storage shelter is built and rebar and sand delivered.
Category : Blog &Overseas construction in Nicaragua
Marie Glen
Jan 14, 2011
Great tips! Thanks. Is it possible in Central America to have a clause in the contract that gives penalties if there are delays on the construction. I have a friend who is still waiting for their house to be built for over 2 years and there is little she can do it seems.
David Steckler
Jan 18, 2011
Hi Marie,
By all means you must have a penalty clause in the construction agreement to penalize the builder for going over his allowed time frame for building your house. In my contract after a certain date the builder will be fined $50 per day. We’ll just back out this fee from the last payment due after the punch list is completed to everyone’s satisfaction.
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