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

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[quote=Anonymous][quote=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?
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So if you live in an 800K house let's say 500K is the land and 300K is the home value on the land.  For the most part around here it is the land that is the real value.  Homes can be built relatively cheap.  Older homes don't have the layouts or the space you might want.  You can build a semi-custom home for a number of prices and you will end up getting what you want and taking some of that value into the resale.  So take that same 500K and you would have something pretty grand.

http://www.webuildonyourlot.com/model-comparison-in-grid-view/

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