Building a New Home in New Orleans S

Building a New Home in New Orleans
A Planning Guide for New Homeowners
By
INSIGHT HOME BUILDERS
2215 Burgundy St.
New Orleans, LA 70117
(504)232-4246
www.insight-homes.com
”Restoring The Past- Building The Future”
Copyright © 2011 by inSight Home Builders
Forward
INSIGHT BUILDERS is a licensed and insured New Orleans based residential and
commercial construction company providing complete services for all phases of the building
process. During the years following the storm and the numerous construction projects INSIGHT
has completed, we accumulated a vast amount of knowledge and information pertaining to the
post Katrina new home building process in New Orleans. This booklet covers many of the
intricacies, pitfalls and short cuts involved in the rebuilding process. This booklet is dedicated to
the spirited New Orleanian who to this day, is still fighting to get back home. We hope this this
booklet make your journey a little easier.
Throughout the building process, keep in mind that building a home entails the assembly of over
one thousand line items. Proper planning is an essential element to a smooth building process
and the process can be at times frustrating and stressful. Embrace your creative spirit and do your
best not to speed up the process or have unrealistic expectations. Your home could take
anywhere from sixty days to a year to build depending on the nature of the project and
unavoidable delays. Work with your builder, he wants the building process to be as successful as
you do. Remember to anticipate and expect delays. They are a natural part of the building
process. You’re building a home. Take as much time as it takes to achieve your dreams.
Remember, you are not building a house, you are building a home.
InSight Home Builders
Copyright © 2011 by inSight Home Builders
Table of Contents
If you are ready to build a new home in New Orleans, the following must be done before
construction starts. Proper planning is essential to a smooth building process and will save you
money and aggravation. Simply follow them to facilitate an easier building experience.
1. Demolition
2. Legal Description
3. Land Survey
4. Your Budget (Funding and Grant Opportunities)
5. Grant Opportunities
6. Designing Your Home
7. Construction Estimate
8. Building Permit
9. Builders Risk Insurance
10. Jobsite Security
11. Termite Treatment
12. Green Building/ Energy Efficiency/ Energy Tax Credits
13. Louisiana One Call
14. Temporary Power
15. Homeowners & Flood Insurance
16. First Day of Construction
1. Demolition/ Clearing The Site
If a house currently exists on your lot, the first step is to demolish the home and clear the lot of
debris. The cost of this varies but should be under $10,000 and can be paid for with Increased
Cost of Compliance Insurance (ICC) and/or Road Home grants if eligible. Before demolition
begins a demolition permit must be obtained (see permit section). Also, utilities must be removed
from the home (see also Louisiana One Call). This can take some time so don’t delay both
Entergy and N.O. Sewerage and Water Board must be contacted. Have the same company that
does the demolition bring in dirt/fill to raise the elevation of your lot for proper drainage before
construction of your new home begins
2. Legal Description
The legal description of your property is the first item needed in the building process. The legal
description provides information and legal details of the lot. It can be found on your appraisal or
bill of sale documents. Legal descriptions for Orleans Parish properties can be found at the Real
Estate and Records office in City Hall room 5W06. In St. Bernard, the legal description can
obtained at the 34th District Court House. There is normally a $1 fee to get a copy of the legal
description. You cannot use the legal description from the Orleans parish tax assessor website or
any other “short form” version. This is needed so the land surveyor can accurately put the
documentation together for determining zoning requirements. A legal description will also be
used in the designing phase of your home.
3. Land Survey
The first fee to be paid, is hiring a land surveyor. The land surveyor will survey your property,
determine zoning for the property, mark all 4 corner boundaries of your property and record your
property’s elevation. This elevation mark will determine how high you must build. Architects
and/ or designers will need this information to design a permittable set of plans. It is advisable to
order a “Builders Package” from the land surveyor to cover the entire building inspection
process. Land survey fees generally cost between $900 and $1200 depending on the location of
the property. There are many land surveyors in the city so be sure to shop around. See the
appendix section for a list of licensed surveyors.
How High Must I Build?
The rules state your “finished floor” must be at or above Base Flood Elevation (BFE), or 3 feet
higher than the highest curb elevation, whichever is higher. You can get a fair idea of the
elevation height by reading a land survey of the property in section 1. Certificate of Construction
Benchmark. The top right section of the survey will show the base flood elevation. This is the
number you compare your elevation to. Under Sect. 1 Cert. of Construction Elevation, take the
average elevation of the four corners of your property. The difference between this average
number and the BFE is the height you must build from the ground, or 3 feet above the highest
curb, whichever is higher.
Example:
Base Flood Elevation for property: -2.5’
Existing top of highest curb elevation: -7.4’
Existing lot elevations (property corners or edge):
Front (right): -7.5’
Rear (right): -7.3’
Front (left): -6.7’
Rear (left): -6.5’
-28.0’ divided by 4= -7.0’ existing lot
Diff. between existing lot -7 & BFE-2.5’=4.5’
Diff. between highest curb -7.4 & BFE -2.5’=4.9’
The required height is 4.9’ above the existing lot elevation since it is the larger number.
(Note: you may receive an insurance discount for building above the required building elevation.
Inquire with your insurance advisor as to what is best.) Insight Home Builders
recommends building at least one foot above the required elevation.
4. The Budget
Before spending any money on plans, you must determine what your construction budget will be
for your home. It is important to design a house you love but also one you can afford. A good per
square foot new construction estimate for budgeting is $120 under roof. This includes porches.
This should be a turnkey price, it should include permits through moving in and should include
any allowances for finishes, cabinets, floors, fixtures, etc. (Note: the more extravagant your
finishes are, the higher the cost will be.)
Once your budget is determined you can begin inquiring about funding sources. Banks and or
mortgage companies can calculate your optimal loan amount based on your income and debt.
This will keep you from extending yourself too thin. Elevation grants are being offered for
qualified homeowners to defray the cost of elevating your construction. There are several nonprofit agencies that will assist you in navigating the maze of financing opportunities and grants
available to the public. A list of these agencies can be found on the Finance Authority of New
Orleans website.
5. Grant Opportunities
There are many federal, state and city funding and grant programs available to citizens wishing
to build a new home. Do your research to see if you qualify for assistance. The State of
Louisiana and the City of New Orleans have Soft Second Mortgage Loan programs that can
provide up to $65,000 to families of low/moderate income plus closing cost assistance.
Typically, to be eligible, the total household income cannot exceed 120% of Median Family
Income. Information on these programs can be found on the FANO website in the attachments
section.
Road Home Elevation Grant
The Road Home program offers a grant of up to $30,000 to those who qualify. In order to qualify
for this grant, you must be a member of the Road Home program, and have received a form in
the mail asking you if you are interested in applying. The deadline to apply has passed, however
extensions may be granted for extenuating circumstances. Call the Road Home elevation hotline
at 1-(877) 234-1513 for more information about extensions. If you choose to take this money,
you are making a commitment to having an elevated home on your lot within 3 years.
HMGP Money
The Hazard Mitigation Grant Program, operated through the Office of Community Development
Disaster Recovery Unit , can reimburse up to $100,000 (based on actual construction costs) to
eligible Road Home Option 1 homeowners for expenses incurred in elevating or reconstructing
their homes to meet current elevation (ABFE or BFE) requirements. HMGP is a reimbursement
program. Homeowner eligibility and eligible expenses are determined by FEMA based on
HMGP regulations. These funds are not subject to the Road Home $150,000 maximum cap. If
you are building a new home, these funds can be applied to the cost of constructing your entire
house, not just your foundation. For more information, an application, and to determine your
eligibility, call (877) 824-8312 or visit www.mitigatela.org.
ICC Funding
Increased Cost of Compliance funding may be available through your insurance agency if you
had flood insurance when Katrina or Rita damaged your property. If your home was more than
50% damaged and the house falls below base flood elevation requirements, you may be eligible
for up to $30,000 to tear down and/or elevate your house. Your ability to secure ICC funding
does affect the amount of money you receive from the Road Home program. Visit the FEMA
ICC site for more information.
6. Designing Your Home
Once your budget is established, it is time to have your home designed. Your builder, an
architect or a residential home designer can help you design your home. If you use a designer to
design your plans you must pay to have a licensed structural engineer complete the engineering
of the foundation and structure and stamp the plans. The engineering fee should cost
approximately 25-50 cents per foundation square foot. Architects that design homes will do a
much more thorough set of plans but will cost more. Their fee generally will cost 10% of the
construction cost including the engineering fees. Also keep in mind that survey, permit fees and
builders risk insurance are not included with plan fees. Any contractor should be able to give you
a preliminary estimate for funding purposes if one is needed. But remember, without a detailed
set of plans it is very difficult to get an accurate cost of construction. Allowances for finishes
should be decided in advance to ensure an accurate construction cost. Also, your architect or
designer should communicate with your contractor to design your home to be as cost efficient as
possible. You don’t want to design a home that can’t be built in your budget.
Insight Home Builders offers our own in-house design service. Our design fee starts at
$2,000.00 with the fee deducted from the construction cost if you use Insight to build your home.
Please contact us if you would like us to design your home.
7. Construction Estimate
With your land survey and a set of plans in hand and an idea of your budget, it is time to
get bids on your home from contractors. Try to get three bids and make sure they are a Louisiana
licensed and insured with general liability insurance as well as workers compensation insurance.
Check references, try to view previous work they have done and ask questions about how they
plan to build your home.
The current rate for new construction in New Orleans ranges from $100-$160 per square
foot, depending on your needs. If you need items such as custom cabinets, granite countertops,
exotic hardwood flooring and a complex floor plan, be ready to pay more. Also REMEMBER,
you get what you pay for, if it sounds too good to be true, it probably is.
8. Building Permit
Take two sets of stamped plans and the elevation certificate from the surveyor to the
Permit Department at New Orleans City Hall to get a construction permit. (Note: be wary of
contractors that ask you to pull permits, it usually means they are not licensed.) As of February 1,
2008 all new homes in Orleans Parish must go through a plan review process. This process may
take one to two weeks before a building permit is granted.
Building permit fee:
$50 plus $5 per $1000 construction value
Also a plan review charge of 1/10 of 1% of the total construction value (minimum of $50)
Example permit fees: $100,000 house
$50 administration fee
$500 permit fee
+ $100 plan review fee
TOTAL:
$650.00 fee
*A penalty of 200% of all fees in addition to the required permit fee is assessed to any
project commenced without the necessary building permit.
Demolition permit fee:
$75 plus $5 per $1000 of the total demolition cost.
** A penalty fee of 500% of all fees in addition to the required permit fee is assessed to any
project commenced without the necessary demolition permit
Note: Any project done in the areas regulated by the Historic District Land Commission (HDLC)
or the Vieux Carre” Commission, will pay a 50% surcharge added to the total permit fees and
plan review fees.
9. Builder’s Risk Insurance.
Builder’s Risk Insurance covers your home for theft, vandalism, fire, and acts of god during the
building of your home. It is an additional cost that the owner pays for in place of homeowners
insurance for the duration of the building process. The deductable is usually $1,000.00 and is
covered by the home owner.
10. Jobsite Security
Jobsite security is a real cost of building that must be addressed before construction begins. It is
the responsibility of all involved to address security concerns. If security is not addressed
additional construction costs and delays may be incurred.
11. Termite Treatment
Termites thrive in the near-tropical conditions of New Orleans, and cause close to $300 million
in damage every year. It is vitally important for homeowners to protect their investment against
termites because of the severe damage that an infestation can cause.
Elevation is the first step toward preventing termite infestation. In addition, make sure all wood
material used under the elevation level is treated and that the site is treated for termites before
construction begins. You may want to treat you’re your lot before construction begins.
12. Green Building/ Energy Efficiency/ Energy Tax Credits
Building green means that the architect and the developer make a commitment to build a
structure that is resource-efficient and environmentally friendly. In some cases, this approach can
make the building cost more up front, but may pay for itself in reduced energy costs. One way
this can be accomplished is by using new technologies such as solar panels and water recycling
systems to reduce the amount of resources that a building requires from the community's
resource grid. However, because systems like this are very new to the market, purchasing and
maintaining them is often costly.
An alternative to using advanced technologies to build an energy-efficient house is to build a
house using simple design principles and construction practices that have been around for
generations. This "practical green" approach is one of the main ways in which a structure can be
made more energy-efficient, and does not require the same degree of upfront investment that
high-tech green systems do. In fact, just by carefully designing and constructing a home with
energy efficiency in mind, an architect can reduce the homeowner's annual energy expenditures
by up to 30%.
Insight Homes Builders is a HBA Certified Green Builder. All our homes are Energy Star
designed (for more information about the Energy Star program see the Energy Star website).
Energy Efficient Building Techniques can result in up to a 30% savings on your monthly utility
bill. Insight Home Builders embraces many design and construction principles that make our
homes healthier to live in and more energy efficient, without a large up-front cost to the
homeowner.
Make sure to:
-
Properly size Central AC/Heating
Design the home for proper building airflow/ ventilation
Proper Sealing: Pay careful attention to sealing your homes. This will result in a steep
reduction of the amount of air allowed to escape the inside of the structure.
Quality Insulation: Use energy-saving, double-paned, low-E windows and proper
insulation in the attic, walls, and floor.
Natural Light: Design the home to take advantage of sun and shade.
Recycle and source as much construction material locally.
Energy Efficient Building Tax Credits:
There are many credits for energy enhancements. See local, state and federal websites, especially
www.energystar.gov, for tax credit programs.
13. Louisiana One Call
Before construction begins make sure your contractor calls Louisiana One Call to have the
property checked for underground utilities. This is a free service that must be done to ensure safe
construction. There are penalties to be paid if underground utilities are damaged. The number to
call is 1-800-272-3020.
14. Temporary Power
Once your home is permitted, your builders must first arrange for temporary power. Your builder
will need electricity and water to complete your home in a timely manner. If power and water are
already supplied, leave them in service. Utility bills should be paid by the contractor while under
construction and should be included in the contract price.
15. Homeowners & Flood Insurance
Before you start building determine the cost of homeowners & flood insurance for your new
home. This insurance is a substantial cost and must be determined as part of your expense
projection for financing your home. Information in insurance providers in included in the
attachments section.
16.
First Day of Construction
Congratulations! You’ve made it through the most difficult and important part of building your
home, the planning stage. Remember, building a new home is long and be complicated. Be
patient and don’t forget to enjoy the creative process. You are not building a house, you are
building a home.
Conclusion
This booklet has taken you through the process of just getting to the building stage in New
Orleans. Planning is by far the most important part of the building process. Don’t take planning
lightly. After this stage is done it’s up to you to select the best builder you can find.
Communication is essential to the building process so make sure you are absolutely comfortable
with the builder you select. Once you select your builder make sure you work with them to build
your home. Many home building projects fail due to unrealistic expectations, distrust, and
breakdowns in the communication process.
inSight Home builders is pleased to have shared our knowledge and experience.
Should you have any questions, advice, or comments please contact us.
InSight Home Builders
2215 Burgundy St.
New Orleans, LA 70117
504-232-4246
[email protected]
www.insight-homes.com
Attachments:
The following info changes constantly. Please contact us for updates
New Orleans Neighborhood Associations
www.npnnola.com/associations/neighborhoods
City of New Orleans- Permit Office
www.citypfno.com
HDLC- New Orleans Historic
www.nola.gov/en/RESIDENTS/HDLC-Home
NORA
www.noraworks.org
Green Building
www.thegreenproject.org
www.globalgreen.org
www.home-builders.org
Energy Star
www.energystar.gov
LSU AgCenter
www.lsuagcenter.com
Insurance Companies
www.louisiana-home-insurance.org
Road Home Program
www.road2la.org
State disaster recovery unit
www.doa.louisiana.gov/cdbg/drhome.htm
Louisiana Recovery Authority
www.lra.louisiana.gov
State of Louisiana websites
www.louisiana.gov
www.gohsep.la.gov
www.getagameplan.org
New Orleans Architecture site
www.jefflamb.worldpress.com/style/
Building Surveyors: Krebs Ph: 889-9616/ Edwards: Ph: 733-2902/ Gilbert: Ph: 837-9842
Finance Authority of New Orleans Soft second info/ Home buyer counciling/
www.financeauthority.org
Banks
Dion Davis
Chase Bank
[email protected]
504-522-2629
Carl Thompson
[email protected]
504-240-3354
Karin Coleman
Fidelity Homestead Savings
[email protected]
504-569-3451
Prax Melancon
[email protected]
504-443-3095
Connie Kinney
First NBC Bank
[email protected]
504-671-3452
Gulf Coast Bank & Trust
Linda Rousell
[email protected]
504-599-5727
Ann Loggins
Hancock Bank
[email protected]
504-832-2962
Carly Gerkin
[email protected]
504-366-1131
Carrie Curet
Iberia Bank
[email protected]
337-359-1575
800-264-7814
Mindy Dinicola
Whitney National Bank
[email protected]
504-619-4214
Frank Moresco
[email protected]
504-838-6450
Mortgage Brokers:
www.nola.com/mortgagerates
Loan calculator:
www.freddiemac.com
Funding Sources for Your Home Elevation
A)
Increased Cost of Compliance (ICC)
 You could claim up to $30,000 if you had flood insurance and if your property sustained
“substantial” and/or “repetitive” damage.
 For more information:
www.fema.gov/business/nfip/icc.shtm
B) Road Home Elevation Grants
 Participants will receive $30,000 for site built or modular homes, in exchange for a
personal obligation to elevate within three years.
 For more information: www.road2la.org or call (888)762-3252
C) State Hazard Mitigation Grant Program (HMGP)
 Up to $30,000 may be available to you—in addition to ICC and Road Home Elevation
Grants—if needed to complete the elevation project (The usual HMGP cost share has
been waived.)
 For more information call (877) 234-1513
D) Traditional HMGP
 Local governments have been implementing an HMGP program, which should not be
confused with the new program described above. Normally, a local/owner cost share of
25% is expected.
E) Severe Repetitive Loss (SRL) Pilot Program
 Congress has approved special funding for the flood mitigation of certain properties
designated by FEMA, whose owners had flood insurance. Eligible homeowners will be
contacted by the local officials. 10% of the project cost must come from a local source,
which could include ICC funding.

For more information: www.fema.gov/government/grant/srl/index/shtm.
F) Small Business Administration (SBA) Mitigation Loans
 the amount of money available varies, up to 15% in addition to the existing loan amount.
 for more information: call SBA’s Disaster Customer Service Center: 800-659-2955 or email: [email protected].
New Orleans Municipal Zoning Code
Information on setback and usage requirements by zoning district.
CNOGIS Property Viewer
Enter an address to find a variety of information relevant to rebuilding, including property ownership,
zoning maps, damage assessment, flood zone maps, and more.
Community on One
Visit the City of New Orleans website that provides easy access to information on city services,
permitting, recovery projects, and other topics relevant to individuals and businesses.
HOPE Credit Union
HOPE Credit Union provides mortgages on flexible terms with low down payments, competitive rates,
and an easy application process. With HOPE, someone earning $30,000 a year may be able to qualify
for a house worth up to $105,000, and loans are locked in at a set monthly rate that is guaranteed to
remain the same. HOPE also provides homebuyer education services. See www.hopecu.org for more
information.
Louisiana Citizens Insurance Tax Credit
Residential and commercial property insurance policyholders will receive an income tax credit for the
Louisiana Citizens Property Insurance Corporation regular and special assessments they paid because
of Hurricanes Katrina and Rita. This is only for people who have insurance through Citizens. You can
still file for this credit. Find out more through their www.rev.state.la.us/sections/general.com
Consumer Credit Counseling Service of Greater New Orleans
CCCS is a non-profit community service agency dedicated to educating consumers in the wise and
proper use of credit, and helping consumers to repay excessive debt. CCCS offers budget counseling &
debt management planning, financial education programs, housing counseling, and more. Visit the
CCCS website or call the main number at 504-529-2396. CCCS has locations in New Orleans, Metairie,
Gretna, Slidell, and Houma, as well as locations in Mississippi.
IRS Road Home FAQ
On this page, the IRS covers the Road Home grant and how it applies to taxes.
Louisiana Land Trust
The Louisiana Land Trust is the non profit organization formed to manage the properties that have
been purchased by the State of Louisiana under the current Road Home Program.
FEMA Housing Portal
This portal is a listing of housing resources throughout Louisiana. Call 1-(888) 294-2822, Mondays to
Fridays, 8 a.m.-5 p.m. or visit the website. Landlords are encouraged to include available apartments
or houses on the list by calling 1-(888) 294-2822. www.asd.fema.gov
Useful Phone Numbers
General
Road Home Program
New Orleans Redevelopment Authority (NORA)
SBA Disaster Customer Service Center
Lower 9th Ward NENA
Louisiana Land Trust
(888)
(504)
(800)
(504)
(225)
ROAD-2-LA
658-4400
659-2955
373-6483
395-0777
Elevation Funding
State-level HMGP Program
Parish-level HMGP Program
Road Home Elevation Hotline
National Flood Insurance Program Claims Line
(877)
(504)
(877)
(800)
824-8312
658-8400
234-1513
767-4341