When Joe Garcia started G&G Custom Homes, he asked his friends to share their worst building horror stories. And he took notes! These conversations gave Joe great insight into practices and habits that he would do anything to avoid.

It also reminded him of the importance of operating with integrity, transparency, and honesty, of treating his clients like family, and of delivering exceptional results. Because when you are investing in a custom forever home, you deserve nothing less.

Unfortunately, not all custom home builders approach clients or projects this way and building your dream home can become a nightmare. Before you sign on the dotted line, watch out for these five red flags. And if you see them – run, don’t walk, away.

1. The custom home builder asks for an unusually large deposit.

Every custom home builder will require an upfront deposit before beginning work. This allows them to purchase supplies and pay subcontractors and employees – all of which are essential to your project. However, if they are asking for anything above and beyond about 15%, there may be a problem. Your home builder should have sufficient capital and credit to pay the remainder of upfront costs.

Be aware that your builder will also require payments that are tied to specific milestones, such as during the framing stage or when the plumbers come in. If your builder wants money by certain dates – not by construction milestones – it is a warning sign that you should heed.

2. They do not provide references.

You wouldn’t hire an employee, nanny, gardener, housekeeper, or dog walker without references. There is no way you should work with a builder who will not provide you with names and contact information of past clients. It indicates that they do not have satisfied homeowners they can contact, that they were unprofessional, that their results were subpar… any number of issues that you want to avoid during your own project.

Note: It is helpful to look at testimonials, customer videos, project galleries, and case studies on a builder’s website as a preliminary step. But be sure to ask for at least three referrals whom you can contact – and follow up!

3. They do not have the right credentials, insurance, and/or licensure.

This is another non-starter. If they do not have proof of insurance and licensure, if they do not belong to relevant industry associations, and if they do not have a solid background in the building trades, they are not worth a second of your time.

You are on the hook here: if someone is injured on the jobsite, for example, they can sue you because it occurred on your property. Lack of insurance can also impact your homeowner’s insurance down the road. When you avoid builders who lack proper insurance and licensure, you avoid all of these problems and then some.

Also look for certifications and designations from industry associations, such as the National Association of Home Builders (e.g. Graduate Master Builder, Certified Graduate Builder, Certified Green Professional, etc.), as this is a reflection of their training and standing in the building community.

"When you are investing in a custom forever home, you deserve nothing less."

4. The builder does not listen.

I really want… I have a question about… I’m worried that… Do you know how….

If you can’t finish any of these sentences, clearly the builder does not have time to help you. You should oblige them by walking away. Custom home building is as much about listening as it is about putting hammer to nail. The first step that Joe takes when working with a homeowner is to ask people what they’re looking for – and actively listen to their replies.

It is essential that you feel your custom home builder is hearing you – and putting you first – throughout every stage. This means they do not:

  • Rush you into making uninformed decisions
  • Pressure you into upselling situations
  • Cut you off when you are speaking and interrupt you
  • Ignore your calls, texts, emails, etc.
  • Answer other calls or focus on their screens when speaking with you
  • Minimize any concerns you have
  • Leave you in the dark regarding your project’s progress
  • Communication is key. Without it, there is not a proper foundation for a relationship – or a house!

5. There Is No Dotted Line!

Don’t even let them explain why they won’t work under a contract or why a verbal or handshake agreement is perfectly sufficient. This is the epitome of a shady builder, and you are virtually guaranteed to experience significant problems during your project – and after.

A contract details the terms and conditions of the work to be completed, but it also protects both parties. It holds you and the builder accountable and gives you recourse if you must litigate – or if the builder tries to file a claim against you. Their word is not good enough, not by a long shot.

How About Custom Home Builder Green Flags?

What are some green flags that a builder operates with integrity and will treat your home like it is their own?

  • They listen to you, now and at every stage of the project
  • They communicate proactively and always respond to you
  • They have the appropriate credentials, licensure, and insurance – and provide you with proof
  • Costs are clearly explained upfront, ensuring you avoid “hidden” expenses
  • Payments are tied to project milestones
  • They are not just willing to provide you with references, they are excited and proud to do so!
  • You will have a dedicated point person
  • They refuse to work without a contract because they want to protect you, your family, and their subcontractors and crews

G&G was built on these principles. As Joe Garcia says, “I build every house like I’m building it for my family.” Any custom home builder can tell you that – but we’ll give you all the proof you need to know that we mean it. Contact G&G to discuss your forever home.

Are you looking for the right custom home builder to help you bring your unique vision to life in a house that is built for living?

At G&G Custom Homes, our team is committed to helping you customize your home, contact us for a free consultation to get started.