The Custom-Home Buying Process

You have decided to build a custom home, to make everything just what you want: a perfect home for your family.

Where to start?

A lot. You need a place to put your home!

Here are some tips for buying a lot.

First, analyze the lot.

A: Are utilities stopped at the curb? Or down the street? It can cost an extra $50-$100,000 to pay to bring utilities to your curb if they are stopped down the street.

B:Dirt-work. How much needs to be moved in or out in order to build? Will you need a retaining wall? Factor in these costs.

C: What are the restrictions of the neighborhood/city? How small of a house can you build? Every area has different rules and restrictions. Make sure you know them before you buy, as they limit what you can do.


So, let’s pretend you found a lot for $50,000. Yay! Super cheap, right?!

A-Utilities go to the curb- no extra fees.

B-It requires $100,000 of dirt work for dirt to be moved out of the lot to build.

C-The city codes require a full brick home, which is far more costly

On paper, this $50,000 lot looks like a great deal- but once you factor in those others costs, it’s no longer so appealing. These factors can nearly quadruple the original price of the lot- and you haven’t even built anything yet!

When thinking of raw land for a custom home, here’s a good rule of thumb. You don’t want it to cost more than 3x the amount of the finished price. So, if you bought a $100,000 lot,  you don’t want to  build a house that will be worth more than $300,000.

Any questions about custom homes? Feel free to contact me or comment below! I’m here to help!

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