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  • Buying vs. Building a house

    This past weekend was a rough one for my fiancee and myself. We had found what was our dream house. We made an offer that was accepted, however there was a previous contract on the house under contingency. Neither agent thought that the other couple would be able to follow through within the 48 hours after our offer was agreed upon. But they did. Needless to say I'm bummed and my fiancee is pretty upset. That probably wouldn't have been so bad, but my fiancee's grandmother funeral was the day before. ugh.

    Anyway, we haven't seen a house that comes close to that.... at least not within our price range. She and I began talking about possibly building a house, or at least planning to build in the future. There are a few lots available that we would be interested in building on.

    I have not idea what goes into building a house. The lots we're looking at are 5 acres so it's not the typical community where every house looks the same. So does that mean we have to find an architect and start from scratch? Do they usually have base blue prints to start from? How much does this usually cost?

    For example, let's say a house on a 5 acre lot costs $300,000. And down street is an open 5 acre lot that costs $50,000. To build an identical house, would it be around $250,000 to build? I just have no idea what it costs to build vs. buy, etc.
    |TG-12th| asch
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  • #2
    Re: Buying vs. Building a house

    Most builders will have a wide selection of existing plans they can work from to build the house. In many cases, they can construct the basic shell and then build/modify the inside of the house to suit. Granted, this isn't the case if you want a custom home or the dream house you found was something highly custom.

    Depending on your area, it is often times a LOT cheaper to buy the $50,000 and put a $150,000 home on it. After valuation it could very well be worth $300K or better even though you've only spend $200k on it.

    My home was recently valued at $255k. The property is worth about $65k in the current market and the structure is about $110k to re-build from scratch.
    Diplomacy is the art of saying "good doggie" while looking for a bigger stick.

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    • #3
      Re: Buying vs. Building a house

      Originally posted by asch
      This past weekend was a rough one for my fiancee and myself. We had found what was our dream house. We made an offer that was accepted, however there was a previous contract on the house under contingency. Neither agent thought that the other couple would be able to follow through within the 48 hours after our offer was agreed upon. But they did. Needless to say I'm bummed and my fiancee is pretty upset. That probably wouldn't have been so bad, but my fiancee's grandmother funeral was the day before. ugh.

      Anyway, we haven't seen a house that comes close to that.... at least not within our price range. She and I began talking about possibly building a house, or at least planning to build in the future. There are a few lots available that we would be interested in building on.

      I have not idea what goes into building a house. The lots we're looking at are 5 acres so it's not the typical community where every house looks the same. So does that mean we have to find an architect and start from scratch? Do they usually have base blue prints to start from? How much does this usually cost?

      For example, let's say a house on a 5 acre lot costs $300,000. And down street is an open 5 acre lot that costs $50,000. To build an identical house, would it be around $250,000 to build? I just have no idea what it costs to build vs. buy, etc.
      A lot depends on where you are...
      I manage a real estate office in CT... (not too far from Apo) and it's crazy busy here... so building is more expensive...
      When I'm working with builders on profit margin and break even, I usually am working with somewhere between 100-125 $/sq. ft for the construction ... that's for something 2500 sq ft and not too fancy...

      there are some incredible plan books and companies out there that can help you with a plan... IMHO custom building while wonderful is more expensive than buying existing or new. Being your own General Contractor if you don't have the experience will be frustrating...

      To Apophis' point... if you can find one of your good local builders he may love working with you to accomplish your dream..

      feel free to pm or email me if you have specific questions...

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      • #4
        Re: Buying vs. Building a house

        We probably wouldn't want a fully custom home. There are "base" styles that we like and would just modify them slightly, for example making many of the doorways have arches, etc.

        So to even figure out if it's something I can afford, I should get a hold of a builder and find out what it costs to build? What's the best way to find out the value of land and the value of the houses in the area?
        |TG-12th| asch
        sigpic

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        • #5
          Re: Buying vs. Building a house

          Originally posted by asch
          We probably wouldn't want a fully custom home. There are "base" styles that we like and would just modify them slightly, for example making many of the doorways have arches, etc.

          So to even figure out if it's something I can afford, I should get a hold of a builder and find out what it costs to build? What's the best way to find out the value of land and the value of the houses in the area?
          Town Hall will have property transfers, look in the area where you want to live...this will help with the price of lots and homes

          If you have an agent ask them to help you... they have quick access to lots of stuff that takes a while to get... plus if they are a good they are worth it.

          I would talk to a recomended builder... tell him/her what you want to do and see what they have to say...they may also have an inside line on some lot's they have been offered.

          Your town hall or county gov.. (whoever handles your land records) may have up to date info on their website. (look for property transfers/land records) Realtor.com will give you a handle on what's currently for sale in your area...

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          • #6
            Re: Buying vs. Building a house

            I can't place enough emphasis on choosing a good buyers broker. The broker we used to buy our last house made all the difference in the world. We went on a 5 hour tour the first day just listing our likes and dislikes of the different houses. Every day after that, he never showed us a house that wasn't perfect for us, we just had to choose where we wanted to be located.

            I think Dog gave you some great advice. One of the things thats always made me nervous about building is the unknowns. Buying a house a few years old means you know what you're getting into.

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