Let’s press on towards the mark of closing out this custom home build of ours! If punch lists and closing on our custom home seem like a tedious task, that’s because it was. When it comes to the latter stages of building your custom homes, attention to detail is of the utmost importance. We’re going to share all of the things we wish we knew before we started this process.
Hopefully, you’ll end up with all the tools you need to successfully navigate the punch lists and closing stage without punching someone in the face.
Why We Choose to Custom Build Our Home
Just in case you’re new here, we’ve been wading through the journey that is our custom home build. We decided to build a custom home when we realized that there was nothing on the market or semi-custom builder’s inventories that would meet our needs. In Part 1 of this home build series, we went through everything you need to know Before Breaking Ground. We covered the Design and Selections process in Part 2. And, finally, in Part 3, we let you know everything we learned in the Framing and Building phases. You can get up to speed by reading all of those posts, but it’s all about punch lists and closing for today.
Now, if you weren’t following my Instagram stories & posts, you may be wondering why we dislike our builder so much. Our punch list is one of the main reasons why. We walked our home and created a rolling punch list since December of 2020 in hopes that when it came time to close, we’d be in great shape. Our thought process was, “If the trade is here working on item ‘x’ now, let’s get it fixed before they move on to a different job.” Well, after doing this weekly or every other week, we found ourselves 2-weeks from closing, and many of the same items were on the “Pre-Closing Punch List.”
We might not be so upset if someone actually took ownership for not getting things done promptly. But, every time we pointed things out, they acted as if it was the first time they’d seen or heard it, and that ticked us off. Clearly, all of our efforts were in vain.
What are Punch Lists?
Punch lists on the house are like red-line edits on an essay paper. Punch lists allow you to communicate to the builder everything you see as incomplete or improperly completed. The intent is for the builder to use the punch list to schedule the trades to return to your home and correct the deficiencies you noted. You mark everything wrong with blue painter’s tape, a visual queue to show punch list work that needs to be done.
Ideally, as you’re walking and blue-taping your items, someone (on your team) takes detailed notes of what the punch list items are. Even then, snapping a pic is something we recommend doing. After you identify everything, you sign off on the builder’s copy of the punch list. But, our recommendation to you is to also send the punch list items and notes to the PM in an email to keep a written record for yourself.
Should the PM have written it down? Yes.
Will the PM act like they didn’t know it was there? Also, yes. Ask me how I know.
Why are Punch Lists Important?
Punch lists are the “I see you” of homebuilding. They put everyone on notice that you are hip to what’s going on and you want it fixed. It doesn’t matter how bad or dangerous an issue is; without a punch list, you’re stuck with a mistake. IF the builder decides to fix it, it’s of their own volition. They don’t have to because you didn’t mark it. The builder doesn’t really care if you’re not happy about a scratch on the new $15K range. They want to wrap things up with you so they can move on to closing out the next house. Since you are the only one who truly cares about what’s wrong with your build, and since you are the one who will have to live with it, you need to be the one who goes over it with a magnifying glass.
Punch lists are also important because, without them, you can miss dangerous things. For example, the gas shutoff valve for our range was behind it. “What’s the big deal, Marta? Just pull the range out when you need to shut it off.” That’s literally what our PM said to me. The person we are paying to build our home. Here’s why I had an issue with it.
This is a Wolf 60-inch, double oven, stainless steel range. It weighs 800-pounds. Who is going to move it if the gas needs to be shut off? Me? The 15-year-old kids? The disabled veteran? Surely not the sorry project manager.
And another thing…
…this ignorance with the gas shutoff valve is another reason why being familiar with standards vs. code requirements vs. “convenient nice-to-haves” is important. I’ve been working with Wolf appliances for most of my culinary career. I am also very familiar with the code that surrounds the installation of gas appliances. Because of this, I called out our project manager and referred to codes that he (as the builder’s rep) was violating. I told him I have no qualms about calling the inspector out to show him what was going on. He suddenly became very compliant.
But what if I were a teacher who never worked in commercial kitchens? Hell, Hector didn’t even know it was improperly installed. Be sure you are familiar with the installation dos and don’ts of everything going into your home. This is a disaster waiting to happen, but do you think the PM or the company’s owner would give a damn if we died in a gas explosion or from carbon monoxide poisoning? The answer is no. I am my family’s biggest advocate, and you need to be yours.
Finally, and most importantly, you are paying for everything about this home. Why wouldn’t you want everything done correctly and to your standard?
How to Prepare for Your Punch Lists Appointments
We can’t stress this enough – walk the house weekly or bi-weekly and begin the punch list then. Always bring blue tape on your visits and “punch” the house then. Additionally, take detailed notes of everything you see, add them to your punch list, and document them with pictures. Every time you walk the house, send an email with the updated punch list items to your PM.
Address big issues as soon as you see them, don’t let them wait until closing. Remember that issue we had with the pouring of the extended patio? Imagine how much of a delay and price increase we would’ve dealt with had I waited until the punch list phase! Even if it’s something small like a light fixture or, in our case, a towel bar, you can get caught with backorder delays or out-of-stock items if you have to replace, reorder, or add a part.
Hire an independent home inspector at different stages of the process. As I said in part 3, commission someone who will come and walk with you (and without your PM) after each phase. Three sets of eyes are better than two, and four is even more so.
What Happens if You Miss Something on Your Punch Lists?
You’re going to notice other things that you missed on the first punch list walk. No big deal. Document them during the next walk. You are certain to find minor things even after closing, so keep that in mind. The first 30-days post-closing is where your builder will repair or touch up those things.
Submit a warranty request thirty days post-closing, but be prepared for it to not be classified as a warranty item. It depends on what it is and whether or not it is proven to be the builder’s fault or a result of your living in the house.
If you don’t catch things before closing, you are stuck with whatever is wrong with the house, so be thorough and take your time. There’s a list of things the builder is not responsible for fixing in our warranty book. If we didn’t identify those issues pre-closing, there’s nothing we could do about it after.
What is Closing?
The closing phase is where you, the builder, and your lender agree the construction is completed to “substantial completion,” making the home habitable.
Before closing, though, you’ll have several walkthroughs. One is the pre-closing punch list we mentioned above, and you may also have a walk with a warranty company if your builder manages warranty calls that way. Some builders manage their own warranties, while others, like our current one, hire a separate company to track and manage warranty calls. Most warranties are 12-months long. The builder comes to fix warranty items for the first 30 days, and the warranty company takes over for the remaining 11 months.
The process varies from company to company, but that’s generally the way it goes.
Things to Keep in Mind When Preparing for Closing
The closing date is fluid, much like the rest of the build, so nothing is set in stone. The most important thing to remember is that you are in control. Do not close until you are comfortable with your build.
The builder needs to let you know in writing when the expected closing date is. Don’t let them bully or pressure you into accepting a date if there are unfinished punch list items. Have the builder complete all of them before closing. The likelihood of them being completed on time after you close is slim. Ask me about our wine room door a month-and-a-half later.
Don’t compromise on the closing date unless extenuating circumstances are forcing you to. However, if you and your builder have been proactive about the items you have identified along the way, there should be no issue.
Be sure to clear up any invoices before closing. I mean, the builder will make sure they get their money, so this statement is just a formality.
Whatever your current housing situation is, now’s the time to make arrangements to transition to your new home. Because we pushed our closing date back, we were in a rush to get out of our apartment before our lease ended. Give yourself enough time to handle the entire process without feeling rushed. Because our builder wasn’t on their game, we were forced to sprint to the finish.
There is one caveat in the closing process. Your construction loan has a maturity date, usually 12-months from closing (on that loan, not the house). If your build exceeds the 12-month mark, as ours did, you’ll have to ask the bank for an extension. Because there are fees to extend, stretch it out as much as possible, so you only have to extend it once. Even with a loan extension, remember, you are in control! And, also remember, if the need for the extension is the builder’s fault, they need to cover the fees to extend the loan.
Should You Agree to a Closing Date if Your Punch Lists Aren’t Complete?
The short answer is no. But, it really does depend on what the unfinished items are and what your timeline looks like.
We were forced to close because our apartment lease was up. We also had more than $2K of moving services lined up. Our initial closing date came and went and more than a quarter of the items on our punch list weren’t complete. Come to the second closing date, and there were still close to ten outstanding items. We gave in because the cost of rearranging the movers and staying in a hotel was not an option.
There is no guarantee the punch list will get done promptly if you close with outstanding items. Again, a month-and-a-half later, the wine room door still isn’t complete. As soon as you close they get their money. So, why would they be in a hurry to get back to your place? In fact, a former employee of the builder we used told me not to close before the punch list was complete because they were notorious for not following through.
Again, a dead light bulb is not worth postponing closing, but a whole missing convection oven (yes, I have the t-shirt from that trip, too) is. We, again, didn’t have a choice, but you might. You need to push for all the punch list items to be done before you close.
What Happens if You’re Not Comfortable with Closing?
Simple…don’t close. Again, keep your lender aware of shortcomings and ask for extensions as they come up. Light a fire under your PM and inform his leadership if you’re not happy with the status of your build. Tell them you will close when you are happy. That usually gets the crews rolling and your punch list completed.
Things We Wished We Knew Before Our Punch Lists and Closing Appointments
We already knew this, but we wish we would have given ourselves another month in the apartment so we didn’t feel like we needed to accept a few of the open items.
We honestly did everything we can think of to give ourselves some wiggle room, but you can’t get water from a stone. The builder is the one who ultimately holds the key to your home, literally and figuratively. If they don’t do their part, there’s not much you can do aside from retaining an attorney. We are still waiting for them to finish our punch list, and I’ve since taken my complaints all the way up to the owner of the company and to review sites. We’ll see what happens.
Tips for your Punch Lists and Closing
Things to remember about the Punch Lists and Closing phase of your custom home build:
- Begin the punch list as early as possible. It’s better to catch issues while the trades work on them than wait until the end.
- You are paying for this house, not the builder, not your PM, not any of the trades. Don’t allow anyone to rush you or bully you into accepting anything less than what you want.
- Document everything in writing and with pictures. I believe there are still good people in the world. My builder and the employees we ended up working with are not those people. They are shady, deceitful, and unprofessional. As a result, it was in our best interest to prove everything we were contracted to have or promised.
Hope for the best, but plan for the worst.
- Hold your builder accountable and make sure replacement parts or equipment are ordered promptly. Make them correct things, especially if they’re not up to code. No one is allowed to put your family at risk because they are too lazy to do a job correctly.
- Remember, you are in control. You have come this far to create this magnificent home for you and your family and you can finish the race. You deserve nothing but the best, so make sure you get it.
I hope our experience with Punch Lists and Closing equips you to go into your custom build with certainty and confidence. Let me know if you’ve picked up any gems throughout this home build series. Save this Punch Lists and Closing post to your home build board for later, too.
Part 5 may be awhile since it’s all about moving in. Once we’ve gotten into the house I’ll be sharing it.
All of the things you have discussed in your posts are very eerily familiar to what we have and are currently experiencing with our custom home builder. I have a strong feeling we are contracted with the same company that you used. Is there anyway you can help us with navigating our impending closing date, …more than you have already disclosed?
I’m happy to try and answer what I can. I’m not a realtor or legal advisor, so I’m limited in what I can offer. Feel free to email me using the contact button in the header of my site, though.