Is it cheaper to tear down our existing house and rebuild, or buy a new construction?

[Anonymous]

So, in-close in, well-established neighborhoods, 20 mins to DC, how much does a well maintained 2500 house on 1.2 acres in desirable neighborhood cost to builder (i.e., how much will builder pay to re-build or tear down) approximately. Thanks.

OP, thanks for starting this thread, as it is a worthy question currently.

[Anonymous]

^^ a mid-century colonial build.

[Anonymous]

Stanley Martin Custom Homes has all the pricing online, plus figure about another $80k-$100k for teardown and site work. We used them about 5 years ago and are happy with the process and results.

[Anonymous]

Anonymous wrote:So, in-close in, well-established neighborhoods, 20 mins to DC, how much does a well maintained 2500 house on 1.2 acres in desirable neighborhood cost to builder (i.e., how much will builder pay to re-build or tear down) approximately. Thanks.

OP, thanks for starting this thread, as it is a worthy question currently.

The condition of your current home will be almost irrelevant to a builder if they are planning to tear it down. A builder is going to pay the same price as everyone else - ie, the market price for buying the house. If anything, a poorly maintained home would be more attractive as it would deter competition for the home and allow the builder to push for a low price. This holds true for anyone wanting to buy a home to tear down.

The cost to build depends on site work, labor, and materials. However, those prices don't change a whole lot in comparison to the price of the lot. The cost to build on a $1 million lot in McLean versus a $30,000 lot in Gainesville would be comparable for the same size and quality of materials. The difference in final sale price is the value of the land and its location.

There is always a cost benefit analysis to the cost of acquiring a property, the cost to build something new, the amount of expected gain, and how much that home could go for. Just because someone spends $1 million to build a home doesn't mean it is worth that price in the market. This holds true for renovations as well. Many people have made the mistake of over doing their home in relation to their neighborhood.

[Anonymous]

Anonymous wrote:It's definitely cheaper to tear down and rebuild. We built new in Bethesda. Our approximately 5000 sq ft house cost about 700K to build with relatively high end finishes. We shopped around builders and there's a huge range, but but it was significantly less to build than it was to buy new. I would contact 2 or 3 custom builders who build in the Bethesda area and ask them to give you a general sense of cost. Many of them have existing plans that you could modify without having to incure significant architectural costs. Best way to figure out the builders you like is to drive around and look at other houses being built that you like.

Would you mind sharing who you used? We are in a similar situation as OP. Close-in Bethesda, need more space and the house needs updating and an addition. We have no mortgage and similar tear downs in our neighborhood are going for $1.2 million +. We'd prefer to move within our neighborhood but there is no inventory so we're strongly considering tearing down.

[Anonymous]

Anonymous wrote:

Anonymous wrote:It depends. How much value is in your house to other buyers if you were to sell or is it a teardown for pretty much any buyer? Then how much is your mortgage, i.e. how much would you walk away with after a sale? And how much would it cost to buy a new build where you want? You don't necessarily have to answer all that but it's tough to determine with the limited info you have given, I'd need much more than what you have outlined.

To teardown and rebuild, you are probably looking at anywhere from $250,000 to $375,000. I know that's a huge range, but it depends on how much house you want to build and how nice the finishes are, etc.

Our house is not a tear down - it would probably go for about $815. (Our current mortgage is $650k). The house we would want to move to would probably be around 2 million (new construction). So if it really is only 375k to build, then that would definitely be cheaper! I really have no idea how much it would cost to build - that's the variable I am unaware of. But I guess my question is, if a house down the street is on the market for 2 million, how much would it cost us to build that same house on our property, aka, what is the mark up?

We are in Bethesda, FWIW.

The mark-up is whatever the seller can get. It's not like tomatoes at whole foods. You might net at the most 100,000 out of selling your house. New on teardown site:
http://www.realtor.com/realestateandhomes-detail/5505-Northfield-Rd_Bethesda_MD_20817_M57251-55841?source=web

If a builder buys for 720,000 and sells for 1.8m thats 1.1 m roughly. I doubt that house was built for 375. Call a builder who has done a teardown. Notice the time frame is at least 8 months for a tear down and rebuild.

[Anonymous]

PP - Better plan for a year. It is 6-8 months of construction time. That doesn't include deconstruction and site prep time as well as planning/design time and waiting for permits.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

Do you really believe that those upgraded finishings are worth 1 million dollars?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

Do you really believe that those upgraded finishings are worth 1 million dollars?

How is your new 5000 SF house not a mcmansion?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It depends. How much value is in your house to other buyers if you were to sell or is it a teardown for pretty much any buyer? Then how much is your mortgage, i.e. how much would you walk away with after a sale? And how much would it cost to buy a new build where you want? You don't necessarily have to answer all that but it's tough to determine with the limited info you have given, I'd need much more than what you have outlined.

To teardown and rebuild, you are probably looking at anywhere from $250,000 to $375,000. I know that's a huge range, but it depends on how much house you want to build and how nice the finishes are, etc.

Our house is not a tear down - it would probably go for about $815. (Our current mortgage is $650k). The house we would want to move to would probably be around 2 million (new construction). So if it really is only 375k to build, then that would definitely be cheaper! I really have no idea how much it would cost to build - that's the variable I am unaware of. But I guess my question is, if a house down the street is on the market for 2 million, how much would it cost us to build that same house on our property, aka, what is the mark up?

We are in Bethesda, FWIW.

The mark-up is whatever the seller can get. It's not like tomatoes at whole foods. You might net at the most 100,000 out of selling your house. New on teardown site:
http://www.realtor.com/realestateandhomes-detail/5505-Northfield-Rd_Bethesda_MD_20817_M57251-55841?source=web

If a builder buys for 720,000 and sells for 1.8m thats 1.1 m roughly. I doubt that house was built for 375. Call a builder who has done a teardown. Notice the time frame is at least 8 months for a tear down and rebuild.

This house in under contract and is almost 5,000 square feet. Since the lot sold for $719,000 and this was listed at $1.8, the new build was clearly not $1.5 million. The $1.5 million for 5,000 sq. ft. Excluding the land sounds very high.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

Do you really believe that those upgraded finishings are worth 1 million dollars?

How is your new 5000 SF house not a mcmansion?

Well, it is on 3 acres. It is not on top of the other homes. It does not have a grand 2-3 story entrance or family room. It is being built as a new old home, staying true to the original architecture of the style. I want an old home that is water tight, energy efficient and green when possible. So that is what we are building. If you want to call it a McMansion, I'm cool with that.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

Do you really believe that those upgraded finishings are worth 1 million dollars?

No, I don't. But all of the other stuff that is getting done along with that is.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Builder here. New construction costs more than a resale. So if you want the best deal then work hard to secure a resale. If you just want new for new you could buy one from a builder on spec. Would not recommend that. When you are a spec builder of the three decision tree - time,quality and money, a good spec builder is going to elect time,money, and quality in that order. I said a good spec builder, not a good builder. I believe you want quality,time, money as the three decision trees so I would be very hesitant to buy spec. In terms of rebuilding on your lot don't listen to knuckleheads on this site sprouting costs. Call up a couple of architects and have them come out. They will give you an idea. That all said, I would assume at least 300.00 square foot cost for build alone for a nice custom home. So, yes if you want a nice 5000 square foot colonial it is going to cost you 1,500,000.00 to have it built. I'm not talking a shit box I am talking a well done home - and that is not completely top of the line. I am working on pricing a 7000 sq. ft. one now and I think the number will start with a 3 as it is definitely 400.00 square foot construction.

5000 square foot colonial it is going to cost you 1,500,000.00 to have it built.
That's abusurd

That is pretty much what we are building and that is what I was told it would cost.

I forgot to say it's a custom home and it being built much better than my current one. The windows, doors, roof, heating/cooling, water treatment system, floors and cabinetry is all a much higher quality than what is in my McMansion. I will add that my McMansion did not cost that much less than what it is going to cost to rebuild the house we bought. It is a tear/down remodel.

Do you really believe that those upgraded finishings are worth 1 million dollars?

No, I don't. But all of the other stuff that is getting done along with that is.

Builders love people like you. No wonder they can look others in the face without laughing when providing outlandish estimates.