The decision to buy and build a house is a big and expensive one. It can be very difficult to make such an investment and it is important to know what this endeavor entails before you make the leap. However, it can be the ultimate tool for those who have the experience and the budget, as you have the ability to build your dream house for cheaper.
On average a built house is $7000 cheaper than a bought house, and with the use of Construction Loans, you can get a much cheaper loan, meaning you can build an incredible house even cheaper.
As usual, the biggest problem for any construction project is finding the right construction company, that is why we set up the Top Home Builders portal. Our goal is to bring together the very best home builders with experienced real estate enthusiasts.
Find out whether or not you should buy land and build a house through this article that will explore the pros, cons, steps in between, time periods for return on investments and more!
7 Things To Consider Before Buying A Piece Of Land To Build A House
Before you are ready to buy land and build a house be sure to have your plan of what you are going to do all mapped out. Remember that every inch on the property is an added cost so it is important not to overbuild. Before you purchase the land, make sure that you have researched what the regulations are in that area, if there are any zoning regulations in place, it would be best to find out about them before moving forward. Also, find out how much each square foot of land will cost.
The following steps are things that you should do before finalizing the purchase of ‘the’ lot:
- Buying the right piece of land (considering zoning restrictions or HOA regulations)
- Finding an architect for your project
- Finding a builder that suits your needs (sometimes the builder also provides the architect)
- Getting a building permit
- Having a contractor lined up before demolishing the old home (if applicable)
- Getting together with your neighbors to prevent interpersonal conflicts later on
- Protecting yourself financially by creating an accurate budget and having appropriate insurance coverage in place
Why Do People Buy Land And Build Their Own Houses?
Buying property with your own home site already included saves money by eliminating costly closing costs associated with buying bare lots or empty tracts of land. Building on your own lot also eliminates many zoning restrictions that could inhibit your ability to design the type of home you want. If you choose an area where there are few houses around yours, it will be easier to sell because buyers will appreciate how much more land you own. Also, if you are in an Association neighborhood, owning the land will give you more say-so in how restrictions and covenants are enforced.
What Are Some Potential Drawbacks Of Buying Your Own Land?
You need to plan your design carefully because it’s going to be hard to make major changes later on without having to pay a lot of extra money. Every inch of property that you use for your house will be an extra cost and so it’s important not to overbuild (two-story foyer, large family room and wide hallways are going to take away from the living space of other rooms). You may also need to purchase a larger lot if you have more than 3 or 4 bedrooms.
More Details On Buying Your Own Land And Building Your Dream House
The first step of buying a property with your own home site already included is to have a plan. One thing you want to consider is what the restrictions are in the area you are looking at. There might be zoning regulations or HOA regulations that will affect your ability to build a house on that piece of land. Another thing to take into consideration is researching how much each square foot of land costs, this will help you estimate how much your new lot will cost.
The second step is finding an architect for your project. This person will work with you and make a blueprint or design for your new house, this ensures that it’s going to fit the space on the lot where you want it built. The next step is getting a building permit. This is required by your area and ensures that the house is built according to the local building laws and regulations. The next step is having a contractor lined up before you start tearing down the old home, this will ensure that all of the work goes smoothly. It’s also important to have any covenants or restrictions from HOA meetings beforehand so you know what you are working with.
The final step is protecting yourself financially by creating an accurate budget and having the right insurance coverage in place. You also want to make sure that everyone who lives with you knows how to deal with any potential conflicts or issues that might arise during the project process. You do this by either training them yourself or hiring a contractor to come in and teach them. Your partner or spouse, should they not already have the understanding required, need to be clued in. This will stop any tension in the fut
You should also give your budget some wiggle room, in case the project is delayed for some reason. This is another essential part of the plan.
Conclusion
Buying land and building a house is an expensive endeavor. However, it can be rewarding in the sense that you have more control over what design elements are included with your home as well as what restrictions or covenants might affect where you live. If you’re considering buying property to build a house on, make sure to carefully plan out how much space will go into each room of your new home before making any major decisions about whether or not this investment is right for you!
