Having the builder "own" it until it's built is the safest approach. This way, if he ends up *not* paying his supplier, the suppliers cannot put a mechanical lien on your house. I've heard more than once from people who found out that they had a mechanical lien because the builder did not pay his bill, and it's the home owners problem because the "build" was done under the ownership of the home owner.
As to not letting people in, you have to remember that US is the most litigious country in the world. So I imagine fear of lawsuit is the single driving force. Just like most mechanics will not let you wander around the garage while they work on your car.
