# New Building Cost/ remodeling



## NewGuyOnTheBlok (Oct 8, 2012)

With myself and a couple of other investors, we have started another company for house flipping and new construction. We are currently looking at a property that is in such bad shape for renovations that we have decided to look into the cost comparison of knocking it down and building new/ remodel. The last new home I built was 10 years ago when I was only a framer. If my memory serves me right the lot cost, materials, and labor cost $120,000 for a 1,000 sq ft ranch in *Iowa*. These are the only numbers I have to go on. Can you guys throw some ballpark cost per sq ft at me for a comparison. I have done additions in the past few years for about $200 a sq (includes everything). I would like some more numbers to look at before we make a decision.


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## CENTERLINE MV (Jan 9, 2011)

Against forum rules to ask for costs. Either get quotes from subcontractors and sub it out, or use this formula:

Labor + Materials + Overhead + Profit = Cost


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## NewGuyOnTheBlok (Oct 8, 2012)

CENTERLINE MV said:


> Against forum rules to ask for costs. Either get quotes from subcontractors and sub it out, or use this formula:
> 
> Labor + Materials + Overhead + Profit = Cost


I understand how to bid. I understand getting quotes from my subs. I know how to figure my cost. I am in a decision crossroads before I put in an offer on this house. I could waste my time, my subs time, my suppliers time or someone who builds new homes for a living could throw out some ballpark numbers to help me per square foot. Much like a customer would ask me what an addition cost, I would reply with $125-$200 a square depending on quality of fixtures, flooring etc. I have already figured my remodel cost for this home. And yes I used *Labor+Materials+overhead+profit=cost.* But instead of figuring up a new construction cost this way and wasting everyones time, I would like to compare what my remodel cost is to $x per sq ft for new home construction. Let me simplify this for you. $80,000 is my remodel cost. If it was $200 per square foot for new construction, I would multiply that times the house we design per sq footage. (1000 square foot home) =$200,000 for the new home.
$80,000 remodel cost compared to $200,000 for new home. I would decide to put in an offer on the house for remodel cost because it's cheaper. A simple ball park number would suffice here. After crunching some numbers roughly I come up with a ballpark of $85/ square. What do you think? please refrain from being the forum police or responding to my question with an answer that does not pertain to my question.


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## TxElectrician (May 21, 2008)

Sorry, had to do it.

Facts & Figures
On April 1, 1994, a new era for the Texas Rangers began with the opening of Rangers Ballpark in Arlington. The beautiful baseball-only facility serves as the centerpiece of a 270-acre complex which solidifies Arlington, Texas as an entertainment giant in the Southwest.
Rangers Ballpark in Arlington, completed in just 23 months, is a state-of-the-art building with the utmost in customer convenience. Yet, the 48,114-seat open-air ballpark was designed and built with tradition and intimacy in mind, containing features such as a granite and brick facade, exposed structural steel, an asymmetrical playing field, and a home run porch in right field. Texas architecture is featured throughout, from the outer facade to the Lone Stars in the concourses and on the seat aisles.
This unique complex also includes a four-story office building within the ballpark, a 12-acre lake, and parks and recreation space on the perimeter. Total cost of the project was approximately $191 million.


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## NewGuyOnTheBlok (Oct 8, 2012)

I would also like to share that I am a remodeler and my books contain cost for just that. I do not know any new home builders locally I could ask so this is why I am asking.


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## NewGuyOnTheBlok (Oct 8, 2012)

TxElectrician said:


> Sorry, had to do it.
> 
> Facts & Figures
> On April 1, 1994, a new era for the Texas Rangers began with the opening of Rangers Ballpark in Arlington. The beautiful baseball-only facility serves as the centerpiece of a 270-acre complex which solidifies Arlington, Texas as an entertainment giant in the Southwest.
> ...


LOL that was hilarious:laughing:


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## Patrick (Apr 12, 2006)

TxElectrician said:


> Sorry, had to do it.
> 
> Facts & Figures
> On April 1, 1994, a new era for the Texas Rangers began with the opening of Rangers Ballpark in Arlington. The beautiful baseball-only facility serves as the centerpiece of a 270-acre complex which solidifies Arlington, Texas as an entertainment giant in the Southwest.
> ...


How accurate is that ballpark?


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## Joasis (Mar 28, 2006)

In all honesty, how would you expect anyone to answer? I build in Oklahoma for $85 a sq/ft routinely on basic ICF homes, and the statewide average for customs is running to $120 a sq/ft. But...that is here, and you are there.


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## NewGuyOnTheBlok (Oct 8, 2012)

Joasis said:


> In all honesty, how would you expect anyone to answer? I build in Oklahoma for $85 a sq/ft routinely on basic ICF homes, and the statewide average for customs is running to $120 a sq/ft. But...that is here, and you are there.


I can figure cost differential by location. $85/sq in Oklahoma puts Iowa about $89/sq. Thanks.


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## Tinstaafl (Jan 6, 2008)

NewGuyOnTheBlok said:


> I could waste my time, my subs time, my suppliers time or someone who builds new homes for a living could throw out some ballpark numbers to help me per square foot.


So you consider it a waste of time to crunch your own numbers on a [hopefully] profitable venture, and would rather rely on free advice from faceless strangers on the internet who have nothing to gain or lose from tossing you whatever number suits their fancy? :whistling:

There are a number of reasons we have a policy against such pricing discussions. One of the lesser ones is to prevent people from shooting themselves in the foot by depending on such potentially unsound advice.

Forum Policeman


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## NINZAN STUDIO (Jan 10, 2012)

I think a good starting point for you and your investors would be to get a design and drawings for the house - or buy a set of plans. Then send it out to bid. You'll then get a baseline price averaging your bids per trade / item. Need to look at what the local market is selling...what's hot, what's not. So many variables here. It's not just a price per SF equation. Asking for generc pricing on an Internet forum for your specific situation sounds nuts to me. Do the leg work.


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## NewGuyOnTheBlok (Oct 8, 2012)

Tinstaafl said:


> So you consider it a waste of time to crunch your own numbers on a [hopefully] profitable venture, and would rather rely on free advice from faceless strangers on the internet who have nothing to gain or lose from tossing you whatever number suits their fancy? :whistling:
> 
> There are a number of reasons we have a policy against such pricing discussions. One of the lesser ones is to prevent people from shooting themselves in the foot by depending on such potentially unsound advice.
> 
> Forum Policeman


I am not relying on anyone one number in particular, I am simply using this forum for an additional research tool. I would not base my decision solely on numbers thrown out from faceless strangers. I don't see anything wrong with my question. It would be no different than me asking any other home builder what there price was per sq foot in person. Based on my research online, calling homebuilders I know in AZ, and the one helpful response in this forum I know that the option of building new is more feasible than my remodel cost. I can now make a offer based on my research and now pursue a more in depth estimate from my subs based off of actual blueprints to build new. I do consider it a waste of time to get in depth with my numbers. The ballpark I came up with was $85/sq. To get more in depth would require prints or a sketch on a cocktail napkin. Time and money I am not willing to loose at this point of the process. Now that I am going to go down the new home path I will crunch all my own numbers, bids from subs etc. I will then have a more accurate number and share it with others if they ask. If there are others looking for the same info here is one of the tools I found helpful. http://www.home-cost.com/construction-cost-per-sf.html#form


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## NewGuyOnTheBlok (Oct 8, 2012)

NINZAN STUDIO said:


> I think a good starting point for you and your investors would be to get a design and drawings for the house - or buy a set of plans. Then send it out to bid. You'll then get a baseline price averaging your bids per trade / item. Need to look at what the local market is selling...what's hot, what's not. So many variables here. It's not just a price per SF equation. Asking for generc pricing on an Internet forum for your specific situation sounds nuts to me. Do the leg work.


Paying for a set a drawings and designing a new house would be a complete waste of time and money at this point. We just want to decide if we are building new or fixing whats there. Once we make that decision we will then go down the avenue you are suggesting. We are just not there yet. If my research turned up a $200/sq to build new than we would not entertain the idea of new.


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## Oconomowoc (Oct 13, 2011)

My brother in law is a builder in Iowa. He said you should shoot for $80 per square foot for a simple style home with no frills.


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## CENTERLINE MV (Jan 9, 2011)

NewGuyOnTheBlok said:


> I understand how to bid. I understand getting quotes from my subs. I know how to figure my cost. I am in a decision crossroads before I put in an offer on this house. I could waste my time, my subs time, my suppliers time or someone who builds new homes for a living could throw out some ballpark numbers to help me per square foot. Much like a customer would ask me what an addition cost, I would reply with $125-$200 a square depending on quality of fixtures, flooring etc. I have already figured my remodel cost for this home. And yes I used *Labor+Materials+overhead+profit=cost.* But instead of figuring up a new construction cost this way and wasting everyones time, I would like to compare what my remodel cost is to $x per sq ft for new home construction. Let me simplify this for you. $80,000 is my remodel cost. If it was $200 per square foot for new construction, I would multiply that times the house we design per sq footage. (1000 square foot home) =$200,000 for the new home.
> $80,000 remodel cost compared to $200,000 for new home. I would decide to put in an offer on the house for remodel cost because it's cheaper. A simple ball park number would suffice here. After crunching some numbers roughly I come up with a ballpark of $85/ square. What do you think? please refrain from being the forum police or responding to my question with an answer that does not pertain to my question.



That's a piss poor attitude to have for someone asking for help and blatantly disregarding forum rules.

If you know your costs, why do you care what other people are charging? Charge what you need to charge and market yourself & your company. 

I've never bid a job based on square foot numbers nor do I even break down what they'd be since it's completely and totally arbitrary. Good luck with your $85 sq ft remodel :laughing:


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## CENTERLINE MV (Jan 9, 2011)

NewGuyOnTheBlok said:


> I can figure cost differential by location. $85/sq in Oklahoma puts Iowa about $89/sq. Thanks.


:laughing: :laughing: :laughing:


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## NewGuyOnTheBlok (Oct 8, 2012)

CENTERLINE MV said:


> That's a piss poor attitude to have for someone asking for help and blatantly disregarding forum rules.
> 
> If you know your costs, why do you care what other people are charging? Charge what you need to charge and market yourself & your company.
> 
> I've never bid a job based on square foot numbers nor do I even break down what they'd be since it's completely and totally arbitrary. Good luck with your $85 sq ft remodel :laughing:


I know my remodeling cost, which is not $85 a square. I myself as a remodeler, not a new home builder, have never bid a job per square either. If you would read the entire conversation you would see that I am not looking for remodel cost. Nor am I looking for a exact new construction cost. I was looking for a comparison cost from another industry, that I am not in, in order to make a proper offer on a house. I did not need a breakdown cost nor did I need an exact. The two helpful responses I received here was helpful enough.


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## Joasis (Mar 28, 2006)

Look at this another way. If I were researching new home costs, all I would have to do is search the new homes for sale in a given market, based on square footage and price, subtract probably 15% if you can GC the project, then I would be able to decide if I wanted to pay X dollars for a lot that I will have additional expenses in demolition and cleanup, plus permitting, and so on, or will it be cheaper to find a vacant lot without a used house on it. If I am building in an established neighborhood, then how will the used homes affect my appraisals? 

It may surprise you, but there are real reasons many of us a: do not build infill homes, and b: no longer speculate on building spec homes. 

I have no idea how you get $200 a foot, but.....


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## concretemasonry (Dec 1, 2006)

Between new and remodeling -

If you are a desk contractor/investor the numbers on local new construction are far more reliable than estimates on remodeling.

A sf price on a bare bones new home is a piece of cake, but additions to get it to sell cost more. A remodeling is just a shot in the dark, no mtter how experienced you are. Every remodeler runs into new situation, problems and codes that are never expected, espectially if your myopic or a big sf estimator, so the over-runs can be disasters.

Only you know or should know the local home and market, so all you will get here is national opinions, like mine.


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## NewGuyOnTheBlok (Oct 8, 2012)

Joasis said:


> Look at this another way. If I were researching new home costs, all I would have to do is search the new homes for sale in a given market, based on square footage and price, subtract probably 15% if you can GC the project, then I would be able to decide if I wanted to pay X dollars for a lot that I will have additional expenses in demolition and cleanup, plus permitting, and so on, or will it be cheaper to find a vacant lot without a used house on it. If I am building in an established neighborhood, then how will the used homes affect my appraisals?
> 
> It may surprise you, but there are real reasons many of us a: do not build infill homes, and b: no longer speculate on building spec homes.
> 
> I have no idea how you get $200 a foot, but.....


 Thats a good idea, why 15%? I am currently past my research stage and have decided to bull doze in and build new. But was still curious why 15%
I have done 4 additions in the last couple years for around $150-$200/ sq.
These are just ballpark numbers I carry in my back pocket for the tire kickers. I don't bid off these numbers. I put in the leg work for my bids like everyone else. I guess I just assumed that new builders do the same. If you've been in the trade a while you tend to know what things average a sq. ft. right?


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## Oconomowoc (Oct 13, 2011)

hdavis said:


> I've never seen it mentioned, but pricing discussions flirts with breaking federal laws. It's an element of price fixing.


No it doesn't.


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## KAP (Feb 19, 2011)

NewGuyOnTheBlok said:


> This house is roach infested, trash everywhere, asbestos ceiling tile, asbestos siding, roof shingles installed improper, needed new furnace, new water heater, floor joist rotting from water damage, front porch collapsing due to roof installed wrong( which is also home to the bathroom, foundation issues. Complete gut to the studs. New electrical service, all new plumbing, garage collapsing. Im sure I forgot some things but it is in rough shape. neglected for many years.


When it comes to flips, what you are concerned about are the bones... 

Everything else IS remodeling... if you already have experience remodeling, pricing shouldn't be an issue. As it relates to new construction, in this case, you also have to factor in demo and removal of the existing structure including dump fees and time on the project (every day costs money in carrying costs), but what it would cost you to build the new house should NOT be what it costs other builders who are subbing everything out... 

The only thing you will be subbing out would be the licensed trades... so your direct costs will/should be less.

If you go new, unless you are placing the same house back in the same footprint, I don't see how you come up with a price WITHOUT drawings...

The idea behind flipping and buy/hold is maximizing profit... that should be your end game... if in your scenario, remodeling costs less THAT IS WHERE YOU MAKE MONEY... vanity is not the reason to spend more...

Our last flip was almost a copy of what you posted above... a complete gut... foundation work, all floor-joists replaced and re-leveled, termites, water-damage, ripped out two chimneys (from the 1920's), all new electric and plumbing (still had glass tubes), porch and back deck replaced, new windows, HVAC ducting and return, the list goes on... the end result... a brand new house that was remodeled without the ADDED costs of NEW permitting, tear-down and refuse fees and holding costs...

BUT, ripping it down and making it new would have REDUCED the profit by THOUSANDS to essentially get the same result... 

The reason you WANT houses like the one you posted above is that you can get them for far less... when they are at that point, the city is involved and are usually given a limited amount of time to make it right... 

Pay your subs every week for time-measured performance... watch how quick it gets done... cash is king... if you are flipping, you want it on the market in less than a month... If buy/hold, you want to start getting a renter lined up two-weeks prior to finish so they can just move in....


Best of luck... 8^)


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## SDel Prete (Jan 8, 2012)

I build new homes and do full renovations in NJ. I've built spec homes for investors and they have made good money off them. I demo 5 houses last year and built new. They all sold before they where some and he has happy. 

I've bought and had investors buy lots for 50k all the way to 500k for land. I've done full build outs of My cost, not with money for me, at $85 to $200 sqft. On new construction. 

Finding out rough pricing right now shouldn't really be a concern. If I was you I'd talk to a real estate agent or do the research yourself seeing what has sold recently. Where, what it was, for what price, what it had in it, what it needed or didn't need ect. 

That is way more important because after you see that. Which ofcourse will be a broad range of numbers, you can then see what you looking to buy. Figure your cost and see if there is money to be made. 

I looked at land yesterday that a real estate agent sent to me in the morning. I checked what's around it and the area in person. Today ill run comps on what I'm looking to build there and then present it to an I vector and see if he wants to make the 85-100k I think he will make while making my 50k. 

Those are the things you need to do if you want to be able to flip homes or build new. Becoming a GC isn't the hardest thing but it certainly isn't the easiest. I had a rough time when I started until I made good connections with trades and gotten their prices down by giving lots of work. I now after many years know all my cost of subs and how things will run. 

Also be aware on rising cost. After super storm sandy hit me the coast of wood went up 5%-10% along with other stuff. The tin work for my HVAC is going up 8% tomorrow. My guy called me to let me know and I cut him a check Friday night so he can buy everything today and save me money. 

I think I've rambled past the question and will end this now. Let me know if you have more questions lol


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## SDel Prete (Jan 8, 2012)

KAP ill agree with just about everything you said but I will NEVER pay a sub in cash.


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## KAP (Feb 19, 2011)

SDel Prete said:


> KAP ill agree with just about everything you said but I will NEVER pay a sub in cash.


You misunderstand me... and I understand why... when I say cash is king, I am referring to cash-flow, meaning they are more apt to make your project a priority and get it done quickly if they know there is money waiting at the end of the week... who wants to wait another week to get paid when you can get it this week? IOW... cash is king... Get 'er done... :thumbsup:

That said... even if you paid in cash, and have a receipt, the same 1099 goes out... Just don't like walking around with a thousands in my pockets... :laughing:


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## SDel Prete (Jan 8, 2012)

KAP said:


> You misunderstand me... and I understand why... when I say cash is king, I am referring to cash-flow, meaning they are more apt to make your project a priority and get it done quickly if they know there is money waiting at the end of the week... who wants to wait another week to get paid when you can get it this week? IOW... cash is king... Get 'er done... :thumbsup:
> 
> That said... even if you paid in cash, and have a receipt, the same 1099 goes out... Just don't like walking around with a thousands in my pockets... :laughing:


Oh ok it was just the placement in the post that confused me. 

Paying at the end of the week is a good idea. On new homes or big remodels I pay 50% up front 25% after they pass rough inspection and final 25% after they pass final inspection. Up to them on fast they work so they get paid lol. 

However if not fast enough for me it's their last job. Though these days I've been using the same subs for a long time and they know the deal


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