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building new home question

4 years ago

We are going down the path of selecting a lot and builder for a new 1800 sq ft ranch home in the general area from Cummings over to Hamilton Mill. But what I am finding that buying a new home compared to buying land and hiring a builder is less expensive to buy a new home or one 2-3 years old. And this is comparing basically the same square footage, floor plan and lot cost. Why is building more expensive? The only thing I can think of is the lot development cost for a single home is much more expensive compared to a new neighborhood where they are developing many lots at one time and thus get economies of scale cost reductions. Any help in this matter will be appreciated.

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User

4 years ago

last modified: 4 years ago

Different lot, different interest rates, different market?

Buy an existing house you like on a site you like and modify it.

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Comments (9)

cpartist
4 years ago
Where is Cummings?
cpartist
4 years ago
When you buy a new car, do you question why it's more money than buying a used one?
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"A better time to go over things is when the house is framed." I agree. Ask them to do a walk through with you when the house is framed. What we do is a full walk through, room by room. Make sure you think about anything and everything you might want. Outlets in your soffits for Christmas lights, under cabinet lights, over cabinet lights, where you want switches, outlets for all your TV's, how many cans you want, how you want them layed out, anything you might want outside, anything special you want in the garage, etc... Try to have as much information as possible too just in case your general contractor doesn't, like your cabinet lay out, vanity heights, if your jetted tub has a heater, etc... If you have a good electrician they will ask questions and give suggestions. If you're having someone do all your low voltage (TV, phone, network, etc...) make sure they and the electrician are on the same page also. Having them wire for a TV, but not having a outlet close by for it, can be an expensive fix. Pretty much they can wire for anything in the world you think you might want, hell we've even wired heated toilets that spray perfume and dry you off after you've done your business. But make sure you take the time to think about everything you want. Every change you add = extra $$$ and it adds up quick.
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I hear what the pros say about tract homes. And I get it. But I've lived in SoCal so long.... it must be the mecca for tract homes. And though they aren't built like a custom home would be, none of the tract homes I've seen look like that. I would go check the other homes in the tract and see if others have that particular defect. If they don't, then the builder is more likely to agree to fix the worst of the problems. You can put up a fight and say you're not going to close.... but you need information to weigh all your options. Would they be able to sell this house for even more money if you backed out? Or would they stand to lose money? Do you know others purchasing homes in this tract? Can you chat with them to see how willing to fix the builder would be? Can you talk to some of the tradespeople to see if management is having them fix stuff? I would keep at it and fight as much as possible. I do not think those wavy walls are typical of any tract home that I've ever seen.
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Lindsey_CA
4 years ago
From two separate Google searches for "Cummings" and "Hamilton Mill," I'm surmising that you are in Georgia. Could be way off, though. At any rate, I am not a pro -- simply a homeowner. And I agree with your assumption that economies of scale cost reduction is a big factor in the cost of a custom home versus a tract home.
beckysharp Reinstate SW Unconditionally
4 years ago
Could you re-phrase the question please? I'm not sure what you're asking.
lyfia
4 years ago
Building custom vs. a tract home is always more expensive as mentioned by others.

Buying existing can be more or less expensive depending on the area as it is very dependent on the market value of a home in the area. It essentially comes down to what are buyers willing to pay in the area, includes some adjustments based on location, features of the house etc. and the market value sets the house price of existing homes. This has very little to do with how much it cost to build the house to start with.
just_janni
4 years ago
Labor pricing continues to increase - home appreciation is rising more slowly than labor costs and land costs. And cp is right - new always costs $$$
PRO
Virgil Carter Fine Art
4 years ago
New costs more than existing. But you can get what you want. At least some of it...
B Sharpe
4 years ago
@john rapp - small world...I just moved from that area (Hamilton Mill)! Yes, we sold and intended to downsize by purchasing smaller. Our home in that area sold so very quickly and now we are custom building our last one in the northeast ga mountains…custom building is definitely more expensive! I still visit your area occasionally and am blown away by all of the new subdivisions. Good Luck! At least I-85 seems to be improving!

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