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Advice Requested - Realtor regarding Building, etc.

2,094 Views | 18 Replies | Last: 5 yr ago by MAS444
SnowboardAg
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AG
Long story short, my family is looking to design a home. We're in the Memorial area and we're a family size of 3 (not changing).

A realtor has been saying that we need to build a home that is expandable up to 4000-5000 sq. ft. We don't want a home that size (mainly because we don't need it), and we are very much struggling with the decision. Here's the options in front of us:
1. Design a 4500 sq. foot home but only build out 3000. Essentially, we have a lot of unfinished 2nd story space but it would be ready for future expansion (all under the roof). Imagine 2 bedroom / 1 bath and a game room upstairs that essentially isn't air conditioned but framed up and ready to hang sheetrock.

2. Build 3000 sq. foot house today with a future addition to make it 4500 designed and ready to go. This option is essentially adding a wing to the house so it would mean pouring more foundation and building out the land.

Both option 1 and 2 would be designed at one time to make sure the house flows and the addition isn't awkward.

3. Forget what the realtor says and build what we want (we cannot predict the future and things could change by then). We plan to stay for 20-25 years. My concern with option 3 is feeling like we might be upside down in this house depending on what it would appraise / sell for today (due to land and construction cost).

The problem with renovating our current home is it's 1800 sq. feet and extending the foundation and reconfiguring is almost as much as option number 3. If we went Option 3, we would be on the smaller end of what other homes are constructing in the neighborhood today.

Just looking for other perspectives and what realtors / others think.
Diggity
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AG
What's the dirt worth?
SnowboardAg
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AG
650-700
Diggity
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AG
I can see your agents point at that land price.

The lenders can chime in but they will likely want to make sure the finished product will appraise with the comparable sales.
SnowboardAg
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AG
Thanks for the feedback diggity! The comps are around 350/sq so I get it, just may change the decision on building. Frustrating, but I don't want to be upside down either.
SteveBott
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AG
As a lender I would not have concerns except getting comps in an appraisal. But that could be over come
Diggity
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AG
If you don't want to be "upside down" I would think you'd have to go to at least 4K square feet with that price ceiling.

4,500 more likely with the kind of finishes I would imagine buyers want at that price point.
SnowboardAg
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AG
Thanks to you both! That's what I'm thinking, 4500 with equal or better finishes. At 4500, the comps align with the build price of 200/sq foot and essentially is "break even" with land value and current comps. We will probably hold off building with those figures, although I have a friend building closer to 170/ft.

We may design and then speculate on the right time to build using option 1 in OP.
Dr T and the Women
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AG
I would be surprised if you could build at 200 per foot with the finish out needed for your area.

I'm building now and we are north of 300/ft on a bigger house (smaller houses are more per foot usually)
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Diggity
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AG
You can build a very nice house for $200/sqft.

Obviously you can go much higher as well, but that's not a bad budget.
SnowboardAg
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AG
I think 200 is about standard today in Houston. That's excluding land. I've heard that could be light and perhaps it's 225-250, but these prices IMO will be coming down as rates go up, Harvey rebuilds subside, and if the stock market recesses. Time will tell!
MAS444
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AG
I've been going through the same process, but in the Heights. Most new builds here are in the 3500 - 5000ft2 range and we just didn't want that much space. We wanted no more than 3000 ft2, which I thought would be easily doable. However, once we got into the design phase, I realized it was going to be impossible to do what we wanted at 3000ft2 or less. So we're going to be at about 3400ft2, which is still on the "small" side for comparable new builds.

My advice is generally build what you want, especially if you plan to be there a long time. I have a realtor buddy in the Heights (lived and worked in the area his whole life - 60+ years) who has bought, built and sold numerous properties in the area, including several homes for he and his wife. The house he most recently built, lived in and then sold did not match up to comps - it was big but only 2 bedrooms (they have no kids). But it was a really nice house in a great area, etc. and he had no problems selling on the very high end of the $/ft spectrum very quickly. His advice - build what you want, but build it nice.

If it's a nice house in a great area, it will sell. I wouldn't want empty, non HVAC'd square footage sitting for a long period of time, for a variety of reasons. I'd rather have a separate easily addable addition built into the plans if you had to choose between those 2 options. But generally, build what you want size wise (within reason)- but build nice (at least up to similar area standards, finishes, etc.)

Also...I know there's a lot of disagreement on the $/ft build cost thing, but I'm in the middle of this process now. I can't imagine you can build a house comparable for your area for under 200---but probably closer to 220+. I was hoping we could do it for 200...and it's just not possible with what we want. And we're not doing super expensive finishes, appliances, etc. I've got all of our actual costs (we're doing flat fee) if you'd like more info. Send me a PM if you'd like.
Diggity
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AG
Dp

Diggity
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AG
Builders do unfinished space on the second story all the time. Not a big deal at all.

Usually just an easy way to finish out later and not tell the local CAD.

MAS444
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AG
I've seen a lot of game room type space and/or space above the garage unfinished...but not necessarily 1000 - 2000 ft2 unfinished, which is what I thought he was talking about. That's still a lot of work/materials you're paying for for empty space that you don't plan on using just for potential return in 20-25 years down the road.

Build what you want, especially if it's a long term deal. Just my opinion.
Diggity
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AG
I agree. In the end, I would imagine the OP would settle on 4Kish with the ability to expand to close to 5K with an added gameroom/bedroom upstairs and possibly a mother in law suite above the garage. Both can be done pretty easily and without much extra cost.

The difference in opinions on build price is all about what level of "custom" and finishes a person wants. I promise you all those spec homes in memorial that are selling for $350/sqft were built for under $200/sqft.
MAS444
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AG
I don't doubt a spec can be built for under 200/ft...especially at 4000 - 5000ft2+.
Diggity
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AG
I know several folks that have done the same when building on their own lots.
SnowboardAg
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AG
Thanks for the feedback MAS. We had 3300 in the woodlands before moving closer in and the house felt HUGE. Very open 4 bed / 3 bath with formal dining, study and large living and kitchen. We will be designing without a formal dining (going a casual formal breakfast area that supports a larger table).

The thing that is almost frustrating to me is how large designers want the master bedroom. 800-1000 sq ft including closet and bathroom just seems absurd to me, thinking of how much land that consumes on the first floor. We'll do what we need to do there, but likely will be on the smaller end. I would rather have less size with higher quality as you say (exposed brick, beams, wood on ceiling, trim work, etc.). I agree on higher quality!

Below is a home with finishes we'll likely mirror after...
https://www.har.com/8421-merlin-drive_gallery/sale_52005878

MAS444
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AG
Totally agree. Our master bedroom is only 14 x 12.5 (which is a little smaller than I wanted even), but with a pretty good sized vestibule entrance for extra privacy. I just don't care about a huge master. I think our whole master bedroom/closets/bath is less than 600 ft2, and that's with separate walk in closets for each of us.

We don't have any really large rooms. Good sized kitchen, living, dining/breakfast and mud room on first floor. 4 bedrooms, study, playroom and laundry on second floor. I really thought we'd be able to do that for no more than 3000 ft2... But we also have a decent sized entry area and some other random, smaller spaces (walk in pantry, bar, stairway landing, upstairs hallway, etc) that eat up square footage.
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