Level off the building, not the ground. Walk the wall and find the lowest point where the sole plate meets the foundation, set your starting height below that point so the panel sheds water past the joint, then snap a level line from there and hang the first course to the line instead of to the concrete. Where the foundation falls away, the bottom of the panel simply stands further off it, and that gap gets covered by trim or left as the clearance your manufacturer requires. Never chase a sloping foundation with the siding, because every course above copies the first one.
Why the first course is the whole wall
A panel hung to a foundation that runs out is not slightly wrong, it is wrong forever. Every course above it stacks on that error, and it compounds. It shows up first at the corners, where two walls that each drifted a different amount have to meet, and at window and door heads, where a course that should die into the trim runs past it instead.
Fixing it later means pulling courses. Getting it right takes one extra pass with a level at the start of the wall.
Finding the starting point
- Walk the whole elevation first. Do not start at the corner you happen to be standing at. Check the sole-plate-to-foundation distance at several points along the wall and find the lowest one.
- Set your height from that low point. Your starting height drops below it far enough that the panel covers the joint and sheds water past it, using the clearance your panel manufacturer publishes.
- Mark it, then transfer it. That single mark is the reference for the entire wall.
Snapping the line
A chalk line off two level marks is enough on a short wall. On a long run, a laser or a water level will beat eyeballing a four foot level along thirty feet of wall, because small errors accumulate every time you leapfrog the level.
Treat every wall separately. Do not wrap a line around a corner and assume it is still true on the next elevation. Walls settle differently, additions settle differently again, and a line that was level on the front can be out by the time it reaches the back. Re-establish it on each face.
What to do about the gap
Once your line is level and the foundation is not, there will be places where the bottom edge of the panel stands proud of the concrete. That is correct, and it is not something to close by dropping the siding. Depending on the detail, that space is covered by a trim board, or it is the drainage clearance the manufacturer already requires you to leave. The one thing it is not is a reason to follow the foundation down.
Holding the sheet on the line
A level line is only worth the chalk if the sheet actually stays on it while you fasten. A full panel will drift down and sideways the moment a hand comes off it, which is why crews give the sheet something to sit on: a second set of hands, a screwed cleat, clamps on the flashing, or a row of support hooks nailed along the line. The options are compared in how do you hold a siding panel in place while you fasten it, and the reasons a sheet moves are covered in how to keep a siding panel from sliding.
Whichever you use
Panel siding is a minimum two-person job, and your panel manufacturer sets the clearance to grade and to hard surfaces, the flashing details, and the fastening schedule. Confirm those against the current instructions for your specific panel. A level line and a support method make the install easier. They do not change what the manufacturer requires.