# Good time to build/sell a house?



## jacob1602 (Dec 7, 2011)

Hey everyone, been a long time reader of this forum so I finally decided to join and post a topic. I have been saving and planning for the past few years so I can start a small build/sell company and now that I am almost ready to go everyone is telling me it is a terrible time to attempt this. I grew up building with my Grandfather, and then my uncle when he took over the family company and now I am trying to follow in their footsteps. Please let me know what you guys think.


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## TNTRenovate (Aug 19, 2010)

1st, post a intro in the intro section.

2nd, it's as good a time as any, and some would say a great time. If you start now and get established, when the boom hits again you are ready to rock and roll. I started my company a few years ago and for the past 15 months I have been non stop 6 days in the field and the 7th in the office. I am tired, but glad to have started when I did.

3rd, Welcome to CT. There are a great group of guys that post regularly and some really great advice. Looking forward to hearing more about how your venture is going.

Good Luck and God Bless,

Rob


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## TBFGhost (Oct 9, 2008)

I still see some homes going up and being sold here and there....but they do sit for a bit.


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## davitk (Oct 3, 2008)

jacob1602 said:


> Hey everyone, been a long time reader of this forum so I finally decided to join and post a topic. I have been saving and planning for the past few years so I can start a small build/sell company and now that I am almost ready to go everyone is telling me it is a terrible time to attempt this. I grew up building with my Grandfather, and then my uncle when he took over the family company and now I am trying to follow in their footsteps. Please let me know what you guys think.


And I thought I was using good drugs today. I can only assume what you call build/sell, you actually mean "Spec" building? You do know that's short for "speculation", i.e. you risk everything for the opportunity to work your as off.


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## Joasis (Mar 28, 2006)

I would talk to a few mortgage lenders in your area...see how tight money will be for prospective buyers. I have two low end specs unsold that have had a birthday.


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## snowtight bldr (Dec 27, 2011)

i have been throwing them up all year. the guy i sub for is a hell of a sales man.


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## Jaws (Dec 20, 2010)

Its a risk. Lots of guys lost their ass here doing it


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## Metro M & L (Jun 3, 2009)

In my market (portland, or metro 1 million population) it seems like in the city core the new higher end houses are moving within six months. 300-400k

Doesn't seem like anyone is building for the low side of the market because the poor first time home owners have the reo and foreclosure market to pick from.


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## Chopsaw Chick (May 6, 2011)

I renovate and resell houses in WA State and dabble in new construction too. The market is definitely tough. It's not the get-rich-quick-scheme that it used to be (before I was involved in the industry) but there is still money to be made. Understanding the construction process is only half the battle, however. You need to know WHAT is selling and WHERE it's selling. Find the best real estate agent in town. You want one who is so busy that they don't need you or your business. This agent will have a ton of listings and drive a really nice car. Arrange a meeting and pick his or her brain. What are the trends? What is selling at or above asking price? What type of property could they consistently sell in a reasonable time frame? What features and upgrades do buyers demand and what could help your house sell faster? Then, you need to follow the MLS - weekly if not daily - and stay on top of market trends. It can be fun and satisfying work. Best of luck to you! :thumbsup:


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## Seven-Delta-FortyOne (Mar 5, 2011)

There are 1.1 million vacant houses in this country right now. 

There are half-built and unbuilt sub-divisions everywhere. 

Cities and towns are finding it impossible to extend services to sub-divisions that did not get completed. 

Forclosures continue unabated, with no end in sight. 

Banks haven't a clue what to do with them, because God forbid that they should make deal with the homeowner to sell it for half-price. 

The banks aren't lending money, because they have no money because they spent the bail-out on CEO bonuses. 

The days of randomly slapping up houses everywhere are over, hopefully for good. For thousands of years, building the place you lived in was an art and a craft, not a disposable commodity like a piece of plastic $#!T from walmart. Let's hope those days never come back.


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## dougger222 (Jan 29, 2004)

I have put more roofs on new construction this year than the past 4 years combined. About half are spec and half are pre sold. My brother has done a lot new construction roofing as well.

IMO, a better bet would be buying forclosed homes or short sales rehabing then selling for a profit. There are guys doing that in my area who are clearing $10K per house.

I met with a very prominent realtor back in 09 with my wife. She asked if now was a ok time to build and he sort of chuckled and said, "NO!". Of course a realtor can sell both existing and new but with all the forclosed houses on the market then and today you can get a lot of house for a lot less than you could 5+ years ago. My wife and I got into a forclosed house for example for $390K that sold 3 years prior for $820K. 

Framing labor on a new build may be down but materials as a whole are up. More than likely a lot of the subs prices are down too. I know GC's who built private homes and bought the lots for $60K marked down from $160K!

If you have cash flow go for it! If your looking to loan for the build it may be tough right now... Banks lost billions to spec builders.


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## jimfix (Sep 7, 2011)

Time is money. Track your hours and costs, and reassess after a few months/year - how much did you make per hour? Could you have made more flipping burgers?

In this economy plan for the worst. Think about renting out until the market returns. 

Parter with good people, you can't do it yourself. Know their limits and your own.

Good luck!


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## rosethornva (Aug 15, 2010)

A.T.C. said:


> There are 1.1 million vacant houses in this country right now.
> 
> There are half-built and unbuilt sub-divisions everywhere.
> 
> ...


This is one of the best posts I have seen here - ever. And I agree with every word of it. 

I wish someone would explain why we're no longer building modest little houses in this country. I assume that when you factor in cost of land and cost of construction and consumers' inflated expectation of "new housing," it's just not financially feasible. 

And I agree with the comment that homebuilding was considered an "art and a craft" (and a skill). 

For years and years, this was Sears best-selling model. They sold thousands and thousands of these. And people built these 12,000-piece kits all by their lonesome. 

Price: about $1,000.


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## davitk (Oct 3, 2008)

I just looked at a local "Spec House" that has been sitting empty since June, built for the local "Parade of Homes". The builder is attempting to rent it for 2500.00/month to cover his holding costs. I'd be willing to wager he'll sit on it for another year and a half, at which point the bank will get it back.

If you want to gamble, take a trip to Vegas. At least you'll stand the chance of having some fun while you lose your money.


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