Buying land and building on it. What's the deal?

May 27, 2006 5:14 PM

I am thinking about buying an acre or so in Western NC on which to build a home and

I am wondering if anyone has relevant information regarding building prices of homes, such as the average price per square foot and any other fees I may not be aware of as a first time buyer.

I'd like to hire a contractor to build the home (2bed/2bath; ~1500 sqft). Is anyone familiar with this process? Value wise, it all seems too good to be true, so I would like someone to burst my bubble in giving me the straight dope on the subject.

posted by Scottk to grab bag (10 answers total)

Construction cost index. Looks like about $120 per sq ft.
posted by acoutu at 6:33 PM on May 27, 2006

Er, I should mention that's from two years ago. It's probably gone up, given the trades shortage.
posted by acoutu at 6:33 PM on May 27, 2006

I bought 50 acres two years ago and am just now building... the foundations went in a couple of weeks ago. My place is about twice the size of yours and in a different country (Canada) but here's the dope:

You can build a home for very little IF you build it like shit. Skimp on everything, use the cheapest possible materials, etc. If you use the minimum insulation, wood frame, vinyl siding, cheap roof, no basement etc, you can get quite a lot of house for not much money.

Now this is actually not an unreasonable thing to do since this is how most subdivision homes are built.

However if you are building a house you care about, this is not a route you will be happy taking. In this case, you will end up spending a lot of money. In most cases buying a 'used' house will be considerably cheaper.

The basic truth is that having someone build you a house is expensive. Everything costs 1.8x what you expect it to. But it may be worth it to you... it certainly was to me.

Here are my basic recommendations:

1. You don't need an architect. Base your design on a house that you know and like. Using the local vernacular style is rarely a bad decision.

2. Keep it simple and consider the resale value.

3. The single most important decision you make will be the choice of General Contractor. It MUST be someone you trust and have checked out. You MUST interview their former clients. Most good GCs will become friends with former clients and remain friends after the project is finished. It is not unreasonable to interview 5-10 GCs before finding one you like.

4. Educate yourself about how houses are constructed.

5. Beware of a fixed-price deal with a GC. It may seem like a great way to control your costs but the house you get will not be as good value as if you pay time & materials, since the GC will artificially inflate the price to cover any unexpected over-runs, and there is no incentive for them to spend anything more than the minimum time finishing the job. It's not necessarily a bad deal, especially for a less expensive house, but watch out.

6. Fees you may not be aware of (from my experience):

Course of construction insurance ( $500-1000)
Survey certificate (you will need this if you are financing this via a mortgage, $500-2000)
Building permit (dunno about your region, where I am about 0.5% of the construction cost)
Depending on your location & codes -- septic design & review, electricity & sewer hookup, driveway, landscaping, structural engineer, soil testing, cost of blueprints/working drawings, and so on and so on.

In terms of cost, around here you can build a house for $120 psf if you skimp and scrape on everything. It will not be much of a home. $150 is much more realistic and you are getting a substantial house. By $170 you are getting a really nice house. At $200 up you are in luxury territory.

My place is budgeted at about $185 psf and that includes options like

brick exterior
steel roof
geothermal heating & cooling
pine floors
spray foam insulation throughout

by losing these options and going to vinyl siding, asphalt roof, propane or baseboard heating, carpets and fiberglass insulation I think I could get it down to about $145 and not really have compromised massively.

The key thing is planning and organisation. Once you have working drawings and a GC you can get estimates from suppliers and subtrades which will give you a very good idea of how much the home will cost and what upgrades or downgrades you should be thinking about.

It is a lot of fun. In my case I ended up as the GC and hired a guy to be my project manager, which seems to be working out very well. It depends what degree of control you would like to have over the project I guess.
posted by unSane at 6:52 PM on May 27, 2006 [1 favorite]

NB my prices are Canadian so multiply by approx 0.9 for US prices.
posted by unSane at 6:54 PM on May 27, 2006

I do not have experience building in western NC, but I've heard others refer to builders there being on "mountain time." The mountains make a run to Home Depot slower, and the Home Depot may be 50 miles away. Plus, winter weather will slow things down. Just keep that in mind.
posted by Frank Grimes at 5:03 AM on May 28, 2006

You may not need an architect, nor want to pay for one, but if you have access to one with any modicum of pizzazz, it could mean the difference between building yourself a standard, servicable, perfectly nice house and something that could really reflect, mentally, spiritually, or artistcally, some of the care and effort you are about to put into this endeavor.

Also, if you use your imagination, you can be informed of from the vernacular building style while perhaps bringing a little more imagination to the whole process. Most people only build a house once in their lives; a good architect --- even if it's yourself --- can help you make your house as special as this event will be.

Just as a little friendly reminder, whether you go architectless or not, this is an excellent time to go green. The construction industry uses a HUGE amount of resources and something like 40% of the oil in this country (manufacturing and transport of materials.) Be creative with your sourcing!

If none of this is in anyway appealing, have you considered modular housing? Could save you a whole bunch of effort and money.
posted by DenOfSizer at 6:15 AM on May 28, 2006

I agree that if you decide to use an architect (a good one, who you get one with) it can make all the difference.

However vernacular building styles are not to be sniffed at. If you like a traditional-looking house, by building in the local style you can save money not just on plans etc but also because the local trades know exactly how these houses are built, and also because they are usually designs which have been refined over the years to be both cheap to build and efficient to heat/cool.
posted by unSane at 6:46 AM on May 28, 2006

(I did use an architect, by the way)
posted by unSane at 6:48 AM on May 28, 2006

Unsane - Agreed, re vernacular architecture, but I just try to look for the underlying lessons of the regional precision without slavishly following the exterior trappings of it. 'Course, if you can reuse gingerbread trim, go for it! Beats using up new material any ole day!
posted by DenOfSizer at 9:32 AM on May 28, 2006

I'd like to cast a vote for the term "hiring an architect" instead of "using an architect." If the architect you choose to hire is worth his/her salt they will be an invaluable aid in helping you define your needs (not always as clear as you may think) and thinking about the spatial implications of those needs.
posted by bryanboyer at 2:47 AM on May 29, 2006