I have been lax updating the blog because it has been a busy summer of building, working and trying to do fun summer stuff. There isn't too much to report on dome progress except WE HAVE A BUILDING PERMIT! Whew! So happy to not have to worry about any more Dome Haters! Read this post if you missed our problem with them. The weather this past spring and summer was a little rough for getting things done. Spring was super wet and cold causing delays. Summer was super hot and stormy causing even more delays. We are getting close to being done with the barn. Rough framing inspection is done and we have a roof and we have started the siding. Next we pour the concrete floor of the tack room so we can install the doors and finish the siding.
One topic I haven't mentioned yet is financing. We have been in the trenches of securing some form of financing for awhile now. Building an unconventional home means you may have issues with getting a construction loan and/or home insurance. Many people building domes have had to come up with alternate ways of financing the build.
Ok, maybe not that drastic but there are many accounts of people doing unusual things to somehow build and then at a later date getting a mortgage after they have struggled through the building. There is one family that I read about that had to build the dome using credit cards because no bank would loan to them. They were at the end able to turn it into some type of mortgage once the home was built.
Up until about 2008 financing was fairly easy to obtain for all but then the lending laws were changed to prevent predatory lending. While this is a good thing in most cases, there was some unintended collateral damage. If you aren't building a traditional home you can't check all their boxes and can't get a building loan. The laws make banks go through a strict assessment step. Now, potential new construction needs to be assessed on its future sales price by finding comparable houses that have sold within a fairly recent window. This isn't a problem if you are building a conventional house. There are usually tons of them that have just sold in the same town that are similar in all criteria. Same construction type, same square footage, same number and type of rooms, similar acreage etc etc. The same can't be said for custom built unique homes. This includes monolithic domes. Without comparable homes you are stuck. We have excellent credit and the domes are way more energy efficient but the banks aren't allowed to loan without the proof of what it will sell for once built.
We managed to find a local bank that specializes in unique rural properties. They finance large acreage and often unique off grid homes/farms. One key is that they do not sell the loan to another company. They keep it and you pay them back. This bank is extra special because they do not require a General Contractor and are flexible on how long it takes to build the home. They have had projects that take up to 3 years to complete. This is a huge find for us. It allows us to save the money (about 20% of the whole home cost) that we would have had to pay for a GC and do much of the work ourselves. BUT that doesn't exempt them from that tricky assessment step. They ended up using geodesic domes statewide to check all their little boxes. The assessors (there were several) were stuck on it being round. Even though monolithic domes have nothing in common with their geodesic cousins other than shape, they were unable to get past the roundness. Others that have built monolithic domes have reported that their banks used nationwide sales, other unique homes or concrete homes as comparables. It is unfortunate that didn't work for us because all the geodesic domes (there weren't many) that sold recently in our state only went for the price of the raw land they were built on. They were all old ones built in the 1970's/80's and those are known for their maintenance issues. One of the comps is about 2 miles from us but it was never completed inside. It was more like a rough hunting cabin. Not exactly a great comp but it had to do. The result of all this..... we can borrow 75% of what our land is worth because we own it outright. This is the only time I have ever been happy that land in my state is expensive! Since we bought the raw land we have done a bunch of improvements like clearing, driveway, power (almost), and barn(almost). If we wait until the barn with water and power is complete to officially apply for our loan we can have the property assessed based on what it is worth with the improvements. So we are spending money so we can borrow against it. The laws prevent the bank from lending us more money to build the house simply because they can't prove it will sell for more than the land with utilities and a traditionally built barn. It isn't just this bank either. I found another that would do the same type of loan but they required a GC and a one year completion. Most banks I talked to said they couldn't do it at all.
I do believe that more people would like to build monolithic domes but can't simply because you must own other property or the land to use as collateral. Even then it may not be enough to build the home. If we didn't own our land and have money saved to build we would not be able to build this house. The end result is that we are able to go forward but it is going to be slow at times and tons of hard work. We need to save everywhere we can by doing as much of the labor as possible.
Oh and about insurance.... we talked to our agent and he said it didn't matter that it was different. He will have no problem insuring us. This is through Allstate. I guess we will see how smoothly it goes when the time comes! We were already using this company but I have heard from other dome owners that Allstate worked for them as well. Not all insurance companies will work with you on keeping the rate down by recognizing the disaster proof nature of the home.
One topic I haven't mentioned yet is financing. We have been in the trenches of securing some form of financing for awhile now. Building an unconventional home means you may have issues with getting a construction loan and/or home insurance. Many people building domes have had to come up with alternate ways of financing the build.
Up until about 2008 financing was fairly easy to obtain for all but then the lending laws were changed to prevent predatory lending. While this is a good thing in most cases, there was some unintended collateral damage. If you aren't building a traditional home you can't check all their boxes and can't get a building loan. The laws make banks go through a strict assessment step. Now, potential new construction needs to be assessed on its future sales price by finding comparable houses that have sold within a fairly recent window. This isn't a problem if you are building a conventional house. There are usually tons of them that have just sold in the same town that are similar in all criteria. Same construction type, same square footage, same number and type of rooms, similar acreage etc etc. The same can't be said for custom built unique homes. This includes monolithic domes. Without comparable homes you are stuck. We have excellent credit and the domes are way more energy efficient but the banks aren't allowed to loan without the proof of what it will sell for once built.
We managed to find a local bank that specializes in unique rural properties. They finance large acreage and often unique off grid homes/farms. One key is that they do not sell the loan to another company. They keep it and you pay them back. This bank is extra special because they do not require a General Contractor and are flexible on how long it takes to build the home. They have had projects that take up to 3 years to complete. This is a huge find for us. It allows us to save the money (about 20% of the whole home cost) that we would have had to pay for a GC and do much of the work ourselves. BUT that doesn't exempt them from that tricky assessment step. They ended up using geodesic domes statewide to check all their little boxes. The assessors (there were several) were stuck on it being round. Even though monolithic domes have nothing in common with their geodesic cousins other than shape, they were unable to get past the roundness. Others that have built monolithic domes have reported that their banks used nationwide sales, other unique homes or concrete homes as comparables. It is unfortunate that didn't work for us because all the geodesic domes (there weren't many) that sold recently in our state only went for the price of the raw land they were built on. They were all old ones built in the 1970's/80's and those are known for their maintenance issues. One of the comps is about 2 miles from us but it was never completed inside. It was more like a rough hunting cabin. Not exactly a great comp but it had to do. The result of all this..... we can borrow 75% of what our land is worth because we own it outright. This is the only time I have ever been happy that land in my state is expensive! Since we bought the raw land we have done a bunch of improvements like clearing, driveway, power (almost), and barn(almost). If we wait until the barn with water and power is complete to officially apply for our loan we can have the property assessed based on what it is worth with the improvements. So we are spending money so we can borrow against it. The laws prevent the bank from lending us more money to build the house simply because they can't prove it will sell for more than the land with utilities and a traditionally built barn. It isn't just this bank either. I found another that would do the same type of loan but they required a GC and a one year completion. Most banks I talked to said they couldn't do it at all.
I do believe that more people would like to build monolithic domes but can't simply because you must own other property or the land to use as collateral. Even then it may not be enough to build the home. If we didn't own our land and have money saved to build we would not be able to build this house. The end result is that we are able to go forward but it is going to be slow at times and tons of hard work. We need to save everywhere we can by doing as much of the labor as possible.
Oh and about insurance.... we talked to our agent and he said it didn't matter that it was different. He will have no problem insuring us. This is through Allstate. I guess we will see how smoothly it goes when the time comes! We were already using this company but I have heard from other dome owners that Allstate worked for them as well. Not all insurance companies will work with you on keeping the rate down by recognizing the disaster proof nature of the home.
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