Quote:
Originally Posted by bogey
I am in the very preliminary stage of this. Here's what I know. Teardowns in my neighborhood are going for $850k (50' X 100' lot) Contractors are buying these homes as is, tearing them down and building back 3,000 to 3,500 sq. ft. homes and are selling them for $1.5 - $1.6M. We're considering moving out. I'm trying to figure out if I would come out better if I tore my own house down and built back, or sell it as is to a contractor. I currently owe $180k on the home. Again, this is very early in the process and I just thought there might be someone on here that would know where I can find out average new construction cost in my area.
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So you can sell your home for $850k
Or
You can tear down, rebuild, and sell for $1.5 million on a 3,000 sq. ft. house.
That means your extra revenue is $1.5m-850k = $650,000, or about $220 per square foot.
You can check this out:
http://www.nahb.org/generic.aspx?sec...&channelID=311 and assume that the cost of bricks and sticks if 50% higher since it's a 2,000 sq. ft. home, and then I'd bump everything up by a cost of living factor given your location.
My other concern would be that you're building a custom house, so you may not have the cost efficiencies of a contractor who's working on a spec home. So you'd need to add some other factor to account for that, but I'm not sure what it would be.