When taking into consideration building your own home option, financing would be the biggest problem you can encounter. You need to calculate everything, from the smallest nail to landscaping and you have to make sure that the anticipated amount of money would suffice to successfully finalize the project.
Expect that your lender with influence a lot your budget when determining what amount to lend you. They may say you can spend a million dollars, but this doesn't mean you want to spend that much. The best way to establish the perfect budget for you is to call for a certified public accountant, a financial advisor or your loan officer. You should take into consideration the following aspects: long-term investment strategy, property appreciation, tax deduction, current tax bracket, cash on hand, capital gains, diversification of assets.
Considering all these aspects, the loan officer or a loan calculator will have to translate all this information into a favorable loan. After you obtained the loan, you need to account for the cash available, as you need a lot of cash. You can always obtain refinancing, but always think twice before you do any step related to financing, as this will affect your financial future a lot. There are also some issues you need to consider. If you can afford a large budget, this doesn't mean that the property will support such an amount. This also depends on the requirements of property and sales from the neighborhood in which you chose to build your home.
Evaluating the finances when building your own home is the first and the most important step and it should be done correctly, or it can lead to a financial disaster.