Has Anyone Here Torn a House down and Built?

[mfer]

Looking for a place to start my research, how to estimate, etc. I've tried looking for books, but they are all from the 80s and 90s. Not sure how much is revalent, etc. I'm not looking to build it myself, but how to know what it will cost, manager the timelines, loans, etc.

I don't know if it is economically feasible I guess.

PM's are great or links to a good forum or book to get me educated would be appreciated.

Please let me know too if you've done it as opposed to just doing a google search for me. I'm looking for real experience. Thanks.

[Dan2010]

Most of my accounting/finance career has been in real estate and construction including the Controller of a $5 billion national homebuilder and a $100 million regional builder. I KNOW what it takes to build a house. It really depends on what you are trying to build. Is it a home in a sub division or out in the country? Do you have plans or are you going to design your own home? Also depends on where you want to build. Land costs can make big a difference. I would need more info to help you further.

[KirkWilfred]

I am a restoration contractor that demo's several homes a year and rebuilds them. I have not managed a multi billion dollar contracting business. I may be able to give you some smaller scale expertise. We reconstruct approx 6-12 homes a year instead of a small town. LOL

[mfer]

Originally Posted by Dan2010

Most of my accounting/finance career has been in real estate and construction including the Controller of a $5 billion national homebuilder and a $100 million regional builder. I KNOW what it takes to build a house. It really depends on what you are trying to build. Is it a home in a sub division or out in the country? Do you have plans or are you going to design your own home? Also depends on where you want to build. Land costs can make big a difference. I would need more info to help you further.

I'm looking for education on the process before I start calling professionals like home builders, contracters, etc.

I have two neighborhoods in mind in a medium sized mid-west city. There are already tear downs in these neighborhoods, so I wouldn't be the first person in the neighborhood, but not the last by any means.

I want to get an idea of how much cash I need to do it, construction loans, etc. I really have no idea what it takes and want to get a plan in place with a cost for the entire project. I'm fine with a pre-defined home plan that we can modify slightly. I'm not looking for my perfect to the inch dream home. Just a modern home in a teardown neighborhood. Better schools, food, groceries, closer to family, etc. There are homes in these neighborhoods from the 150's (aka the teardowns) to the 1.5million mark. I'm not looking for a million dollar home btw.

[mfer]

Originally Posted by KirkWilfred

I am a restoration contractor that demo's several homes a year and rebuilds them. I have not managed a multi billion dollar contracting business. I may be able to give you some smaller scale expertise. We reconstruct approx 6-12 homes a year instead of a small town. LOL

Good stuff. Where do I start?

[Dan2010]

Originally Posted by mfer

I'm looking for education on the process before I start calling professionals like home builders, contracters, etc.

I have two neighborhoods in mind in a medium sized mid-west city. There are already tear downs in these neighborhoods, so I wouldn't be the first person in the neighborhood, but not the last by any means.

I want to get an idea of how much cash I need to do it, construction loans, etc. I really have no idea what it takes and want to get a plan in place with a cost for the entire project. I'm fine with a pre-defined home plan that we can modify slightly. I'm not looking for my perfect to the inch dream home. Just a modern home in a teardown neighborhood. Better schools, food, groceries, closer to family, etc. There are homes in these neighborhoods from the 150's (aka the teardowns) to the 1.5million mark. I'm not looking for a million dollar home btw.

The first thing you will want is to find floor plans that you are interested in. You can find plans on the internet, a home builder or a local architect. Determine the square footage, garage, etc. Next thing you will want to do is find the land to put it on to make sure it fits. After that, the cost is really going to depend on material costs at the time you build as these costs tend to flucuate. Labor costs will not skyrocket right now like materials will. I would count on the home costing as much as some of the existing homes that have been rebuilt in the neighborhood. If you see a 3000 sq ft house for $200,000 in the neighborhood, well it will probably cost you similarly.

Honestly, if I were you, I would find the land or property to tear down and get quotes from 3 different builders. You will get a good idea what the costs will be and you will have what you need to go to the bank for a construction loan. Depending on the type home, it can be built in 30 - 90 days. A REAL nice home will take longer, 6 months to a year.

[rainman_16]

Our neighbourhood has seen ongoing teardowns/rebuilds for years. For a nicely (comfortable with style) appointed custom home you'd generally be looking at around $200+/sq ft, not including land. I have no idea whether Canadian pricing differs that much from American.

[6352]

You may not consider a complete tear down, then it would not cost as much, the permits would be easier to obtain also if it was a remodel than a complete demo.

[Dan2010]

Originally Posted by rainman_16

Our neighbourhood has seen ongoing teardowns/rebuilds for years. For a nicely (comfortable with style) appointed custom home you'd generally be looking at around $200+/sq ft, not including land. I have no idea whether Canadian pricing differs that much from American.

Building costs in America are very local. We used to sell houses in Charleston, SC for $300,000 and the same house in Las Vegas would go for $1.2 million. However, our profit in Charleston would be 30% but it would be 60% in Vegas. He really needs to know what his local costs are.

[HYDROMAROC]

Regarding a teardown.. Check with your city regarding taxes. If you teardown in SD all the way, it's new construction. if you leave only one wall of the origional structure, believe it or not, it's considered a remodel...

[HYDROMAROC]

Originally Posted by Dan2010

Building costs in America are very local. We used to sell houses in Charleston, SC for $300,000 and the same house in Las Vegas would go for $1.2 million. However, our profit in Charleston would be 30% but it would be 60% in Vegas. He really needs to know what his local costs are.

You'd be lucky if that Vegas house is worth 300k now...

[Dan2010]

Originally Posted by HYDROMAROC

You'd be lucky if that Vegas house is worth 300k now...

Yeah, thats a whole different discussion.........lol

[mfer]

Originally Posted by Dan2010

The first thing you will want is to find floor plans that you are interested in. You can find plans on the internet, a home builder or a local architect. Determine the square footage, garage, etc. Next thing you will want to do is find the land to put it on to make sure it fits. After that, the cost is really going to depend on material costs at the time you build as these costs tend to flucuate. Labor costs will not skyrocket right now like materials will. I would count on the home costing as much as some of the existing homes that have been rebuilt in the neighborhood. If you see a 3000 sq ft house for $200,000 in the neighborhood, well it will probably cost you similarly.

Honestly, if I were you, I would find the land or property to tear down and get quotes from 3 different builders. You will get a good idea what the costs will be and you will have what you need to go to the bank for a construction loan. Depending on the type home, it can be built in 30 - 90 days. A REAL nice home will take longer, 6 months to a year.

Appreciate all you input, but you are coming from a business standpoint, where you have money at your disposal. I would need to budget much more closesly, understand tax law, permits, construction loans, etc. I hear the biggest issue is people don't properly plan expenses and budget realistically. Get 80% done and they fail, etc. I don't want surprises. I guess I just need to start making calls and collecting information.

Any more advice from Dan or others would be appreciated.

[Dan2010]

Originally Posted by mfer

Appreciate all you input, but you are coming from a business standpoint, where you have money at your disposal. I would need to budget much more closesly, understand tax law, permits, construction loans, etc. I hear the biggest issue is people don't properly plan expenses and budget realistically. Get 80% done and they fail, etc. I don't want surprises. I guess I just need to start making calls and collecting information.

Any more advice from Dan or others would be appreciated.

Of course I am looking at it as business standpoint. You should be too. You need plans, then you need to get quotes from builders to build using those plans. You don't need tons of money for this part of the process. Once you have narrowed down what you actually want AND can afford THEN you go to the bank, get a construction loan and build. You don't need to worry about tax law. You don't need to worry about permits, that is what the builder will worry about. Again, you need to talk to a builder.

[AWS]

Sounds like my area....older established area, desirable location, good schools, shopping, etc. Teardowns are quite common although things have slowed the past couple of years.

I know builders use to say building costs to land costs should be 4 or 5:1. I believe it's closer to 3:1 with the limited number of lots and premium prices people pay for a house only to tear it down.

I would definately be working with a knowledgeable Realtor and/or Builder that really knows the area.

Good luck!