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

[Anonymous]

Anonymous wrote:

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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.

To each their own but this sounds really boring and wouldn't require much architectural thought or process. I think you got taken for a ride when the builder saw what you could afford.

[Anonymous]

Anonymous wrote:

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.

The house needs a lot if work done to it to make it structurally sound and the entire grading of the house has to change. It's not just finishes I am talking about. I am sure you still think I am a sucker and you are entitled to your opinion. There really is no need to be an asshole about it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

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.

To each their own but this sounds really boring and wouldn't require much architectural thought or process. I think you got taken for a ride when the builder saw what you could afford.

It's what we like, so yes, to each their own. It's okay if you think I am getting taken, but I know I am not. I come from a family of builders and they are approving everything every step of the way. I am sure I could have found a cheaper builder, but I don't like shoddy work.

[Anonymous]

Anonymous wrote:Remember when considering building a new home on your lot - you can't tear down a home if you have a mortgage on it. You will have to own the home/land outright then get a construction loan for building the home, or use cash to build the home also.

This is incorrect.

[Anonymous]

Anonymous wrote:

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.

I think the price for a house like this would be closer to $800,000 than $1,500,000.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

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.

I think the price for a house like this would be closer to $800,000 than $1,500,000.

Profit needs to be at least 30%

[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.

Was this NDI?

[Anonymous]

9:11 here. PP, we did not use NDI. I would rather not say who we used, but we found that there are at least a handful of small to mid-size builders in Bethesda who will build a house for under a million without compromising quality. I personally preferred the smaller builders to the mass production ones.

A lot of the builders I have heard of are listed here on Mary Murphy's website: http://maryjmurphy.com/new_custom_homes

[Anonymous]

Anonymous wrote:9:11 here. PP, we did not use NDI. I would rather not say who we used, but we found that there are at least a handful of small to mid-size builders in Bethesda who will build a house for under a million without compromising quality. I personally preferred the smaller builders to the mass production ones.

A lot of the builders I have heard of are listed here on Mary Murphy's website: http://maryjmurphy.com/new_custom_homes

Thanks for the link. This is helpful.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

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.

I think the price for a house like this would be closer to $800,000 than $1,500,000.

Profit needs to be at least 30%

Really? I thought was profit to the builder was closer to 20%.

[Anonymous]

Anonymous wrote:9:11 here. PP, we did not use NDI. I would rather not say who we used, but we found that there are at least a handful of small to mid-size builders in Bethesda who will build a house for under a million without compromising quality. I personally preferred the smaller builders to the mass production ones.

A lot of the builders I have heard of are listed here on Mary Murphy's website: http://maryjmurphy.com/new_custom_homes

Well from someone who lives in Bethesda I am not sure there is much difference from the outside-- the new houses all look alike, if not identical (but at least there's no HOA, right?)

[Anonymous]

So looking at Stanley Martin Custom - You can pick out a 350K turnkey price plus another 80-100K in site and permit costs and add in renting a place and possible storage costs.

It appears you can build something for 500K all inclusive. How can this not be cheaper than buying a house?

[Anonymous]

Anonymous wrote:So looking at Stanley Martin Custom - You can pick out a 350K turnkey price plus another 80-100K in site and permit costs and add in renting a place and possible storage costs.

It appears you can build something for 500K all inclusive. How can this not be cheaper than buying a house?

Uh, the cost of the land could run you 500-600K easy, depending on the area.

[Anonymous]

NP here. I'm not trying to be snarky, but I am trying to understand the practical math here. If you live in, let's say, an 800K house now and would like to upgrade. Just to keep it easy, let's say you own it outright. If you sell it and keep the money, minus fees, and then add $500K you end up in a nice 1.25 home or thereabouts. If you tear down your home you have no sales profit to put toward a new house. Can you really build a 1.25 value home for that same 500K? It just seems that when you tear down and don't have any profit from a sale to put toward a new house you'd have to end up spending more, wouldn't you?

[Anonymous]

Anonymous wrote:

Anonymous wrote:So looking at Stanley Martin Custom - You can pick out a 350K turnkey price plus another 80-100K in site and permit costs and add in renting a place and possible storage costs.

It appears you can build something for 500K all inclusive. How can this not be cheaper than buying a house?

Uh, the cost of the land could run you 500-600K easy, depending on the area.

The assumption is that I like the land/place that I have right now -- not the house on top of it. So I tear down the house and build on top.