I'm sure it depends on where in California you live but in the SF Bay Area $200/sqft would be all but impossible for a high end build. It may be technically possible to achieve by doing bargain basement finishes but I doubt it. I averaged about that several years ago on a remodel during the depths of the crunch when no one had any work. If you're reading sites like this or Houzz and seeing people's fabulous interiors, you will blow past $400/sqft before you know it. A lot of it is driven by finishes. Things to watch for: - Allowances. The builder's idea of $5000 worth of faucets may differ from yours. They may be figuring Home Depot Moen and you may be figuring Newport Brass. You can (and should) drill down on this stuff yourself ahead of time. It's time consuming but worth it. e.g. go online and pick out all your plumbing hardware. How much does that cost? Did you remember to get all the supply lines, valves etc? If you're not super technical you may want to talk to a local plumbing store. They will charge you more but will make sure you're not missing anything. Same thing for appliances etc. Now you're starting to fill out allowance budgets. - Did I mention that finishes can drive cost through the roof? e.g. tile and slab materials and install costs. Go to one of those giant tile/slab warehouses and talk to the staff there and get a sense for the cost. Same thing for masonry. Even fake stone is expensive. Don't get me started on trim work (crown molding, paneling etc). Cost for these various finish items can exceed 50% of your budget. - Did you think about landscaping? It can run up to 30% of your budget depending on the site work required. Do you need engineered retaining walls? - Builders and architects that don't include soft costs in their estimation. Soft costs are everything other than the cost to build the house. This includes design fees, permits, etc. In my area permiting alone can run $30-40k before you even dig a hole. You should go to your town hall and find out everything you need to know about building a house. What's the planning process? What are all of the fees? I've heard you should figure ~15% of project cost for soft costs. - What about site work and engineering? This stuff is invisible but highly necessary in certain areas where there are hills, fault zones, etc. Don't trust line item numbers that have too many zeros. They are just estimates. I don't want to sound discouraging but I want you to know people will stretch the truth to get your business and figure they can ease you into more later. A huge part of it is about self control yes, it just depends on your tastes.

Okay, thanks a lot. I want to cover all my bases this time. My last buyer had a mortgage contingency. Everything was going great. The house appraised out for the money, her credit was great, she qualified for a house that cost more than mine, stable jobs, the whole bit. So I told everyone who inquired that we were under contract but were taking back-up offers. They said okay bye. Two days before closing, the buyer was declined for her mortgage because the lender didn't like it that it was a horse farm (even though they knew this from the beginning). I contacted everyone who showed an interest but they were gone. So I don't want that to happen again because I realize it's very likely someone is going to ask me for a house-selling contingency. I will make sure the lawyer puts that kick-out clause in the contract. And I won't schedule the closing till all contingencies are met. The last buyer pushed me to schedule the closing and that's partly what really messed us all up because we had to find another house to move to, schedule movers (moving to another state), oh, just a ton of stuff that caused a lot of trouble. What would be a good time limit to give them for selling their house? You wouldn't leave it open-ended would you?

"We double checked the contract.... there isn't even a financial contingency listed in it. Our agent has 20+ years experience, all in our old town, so I don't know why she didn't have our buyers prepare financing in advance in case their buyer flaked out, to have the "no contingency" thing airtight." Regardless of the reason (negligence or out and out pre-meditated deception) there is no excuse. If she carries E&O insurance...and if the deal does fall apart due to the RE agent's misrepresentation, you should put in a claim for any financial damages that you may incur. If not, at the very least, she should be reported to the state board that licenses real estate agents as: 1) She did not even notify you of the problem for days. 2) YOU had to call HER to find out that she dropped the ball on the contingency issue. 3) Relayed the info to you as if it was a non-issue...even though she KNEW that this was in violation of the contract. 4) Insult to injury... she left town, leaving you to deal with the problems that she caused...and has not even bothered to keep in touch. 5) You still have no information regarding how and why she let this happen. If you do manage to work this out, I would renegotiate her fee...as you were stuck cleaning up after her "mistake", and but for your efforts, the deal would most likely have fallen apart altogether. This is SUPPOSED to be what "earning the fee" is all about...that said, time for a discount. After 20 years plus as an agent, it is extremely doubtful that she forgot her own aversion to contingencies...or that she forgot that this buyers first offer was rejected because of a contingency...which is documented by the contract. Yet, somehow she forgot all of this when the buyer presented an offer WITH a contingency in place.... That said, this occurance only further serves to prove that experience is meaningless with an agent that will pursue their own agenda over that of the seller and/or buyer....and, regardless of what the contract may or may not state... This is just another example of why it is best to hire a good RE attorney to review the contract, offers, etc..to make certain it is as one believes it to be...as opposed to relying upon the RE agent for correct information.....ESPECIALLY if the agent can't be held accountable for their screw-ups, intentional or otherwise.

Well, it's 3 weeks later and we closed on the land sale today and are under contract on the "replacement" rental property set to close at the end of the month. Title work on that came back clean today and inspection set for Thursday. Actually, after offering based on comps and then walking away from the house mentioned in my original post, we're under contract on a different property. It's newer, more upscale, and we were able to get it slighly under good recent comps. It should very rent well, but we won't have to worry about rentals for a while because we've agreed on the terms of a lease to rent it back to the Sellers while they build - a win-win for everyone!