Author Topic: Has anyone purchased land and built a house?  (Read 2685 times)

asauer

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Has anyone purchased land and built a house?
« on: February 14, 2021, 11:00:40 AM »
Hi all!  Looking for some advice/ lessons learned.  We will be selling our home and downsizing in a couple of years and I've been searching around our area for a certain square footage (1,600-1,750 sq ft). We now have 2500 sq ft.  I've been surprised at how poorly constructed the homes are and now think our best bet might be to buy land and build a smaller but well constructed home but I'm nervous.  For those that have taken this route, what should I be considering/ looking out for?  I know that I'll need to find land that has residential zoning but I'm pretty in the dark other than that. 

Fishindude

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Re: Has anyone purchased land and built a house?
« Reply #1 on: February 14, 2021, 11:21:30 AM »
My suggestion would be to first find a piece of land that you really like and get it purchased.
Then design a home that works with the land.

The property is the real gem.

ender

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Re: Has anyone purchased land and built a house?
« Reply #2 on: February 14, 2021, 12:16:28 PM »
I'm also curious about this process.

It's in our longer term dream planning, at least :-)

bacchi

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Re: Has anyone purchased land and built a house?
« Reply #3 on: February 14, 2021, 12:48:09 PM »
deed restrictions/HOA requirements on the land, if any. Some HOAs require a minimum house size.
Flooding potential
Sun exposure -- if you want southern exposure for heat gain, is it blocked by evergreen trees or a neighbor? Or maybe you want to avoid the summer sun.
utility connections -- sewer, water, electricity, internet
are there any obstacles in the way of the building footprint?

asauer

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Re: Has anyone purchased land and built a house?
« Reply #4 on: February 15, 2021, 02:15:55 PM »
deed restrictions/HOA requirements on the land, if any. Some HOAs require a minimum house size.
Flooding potential
Sun exposure -- if you want southern exposure for heat gain, is it blocked by evergreen trees or a neighbor? Or maybe you want to avoid the summer sun.
utility connections -- sewer, water, electricity, internet
are there any obstacles in the way of the building footprint?

Great advice!  Thanks so much.

nereo

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Re: Has anyone purchased land and built a house?
« Reply #5 on: February 15, 2021, 02:20:58 PM »
P2F.
We are exploring this as well.

TheInsuranceMan

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Re: Has anyone purchased land and built a house?
« Reply #6 on: February 15, 2021, 02:23:57 PM »
We just did!  Well, closed on it the end of June, it has a house on it that we are currently living in, but it isn't fit to update.  Given, I'm probably in a much different area than you are.  I'm sitting on 7 acres surrounded by farm ground, not buying a lot in town and hoping to build.  However, still similar, buying this has kind of tied our hands for a bit, but at least we have a place to live while we pay it off and save money for the build

Evgenia

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Re: Has anyone purchased land and built a house?
« Reply #7 on: February 15, 2021, 03:18:23 PM »
We haven't done it yet but we're planning to. The Covid housing bubble decreased land prices in the dream area we've been monitoring for over a decade, so we jumped and got the lot, with sewer, utilities, on the coast etc. for $55k late last year. Just about finished with the conceptual plans but still a couple of years out, no doubt.

We were certain of the location, that was the first thing. We knew what we wanted in terms of proximity to a town.

We were also clear on what was important in terms of utility availability (namely Internet), and sewer (in an area where most things are septic). There is nothing wrong with septic systems, I just didn't want to deal with installing and maintaining it if I didn't have to, given prior experience.

We looked into property tax and any HOA/related stuff. If there is any sort of association, look for public meeting minutes. We were looking in one area and, by reading meeting minutes, I found LOADS of drama going on in one small town on the coast, that even led to liens being placed on some people's properties out of, apparently, retribution. Wild stuff and nothing we wanted to be part of.

Also check out surrounding land stuff. Wildfire risk is a thing in the west, so we have no illusions about that, but that made us relieved that the ridge behind us was managed timber land. The community also has its own water reservoir, which not all areas in California do. Indeed, one town over from where we bought, there's a water shortage so you can build a house but can't install a water meter.

Parcel restrictions. Look for any of those. We found out, from some maps on lots we did NOT choose, that some parcels had "restricted private" sections in which a person could fully OWN the parcel, but could not build *or even alter any vegetation on* the restricted sections of a parcel. So, if the ocean view is only available from the restricted area, you won't be looking at the ocean.

Those were the main things we looked at.
« Last Edit: February 15, 2021, 03:24:43 PM by Evgenia »

NoMoWork

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Re: Has anyone purchased land and built a house?
« Reply #8 on: February 15, 2021, 05:45:36 PM »
This is definitely in our future.  Would like to get 10 - 20 acres in NW Arkansas; I am planning to do a lot of the build myself. 

texxan1

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Re: Has anyone purchased land and built a house?
« Reply #9 on: February 15, 2021, 07:57:07 PM »
building a house is a pain the ass, but it is satifying once done and you will save a bundle if you General contract it yourself.... Just find subs and get bids and put them against eachother and do a quality interview... Also helps to hire a BUILDING supervisor, usually a GC who does it on the side for a few thousand per job... I did my house and saved almost 200K on the build...... I litterally order a book about building your own home on amazon and watch some youtube videos.. its not hard, just gotta keep your eye on the guys

FarFetchd

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Re: Has anyone purchased land and built a house?
« Reply #10 on: February 15, 2021, 11:51:34 PM »
We just bought a plot, and have the rough layout almost finalized with the architect. I'd also like to hear people's experiences. I have three pieces of information to share so far, from these early stages.

First, our architect is a freelance guy, and from our experience that seems like the way to go - unless we just got really lucky with him. The firms we came across want rich people to pay them huge amounts to design beautiful mansions. Some won't even consider a ~2000sqft single family house project. The freelance guy, on the other hand, works entirely with ordinary houses. It's been a great process so far, with just the right mix of soliciting our input, and presenting useful ideas based on his own creativity and experience.

Second: when looking for builders, many/most of them were in the "custom home" business. This is probably not what you (as a MMM forumgoer) want. Rather, it is for spendy people who want a semi-customized McMansion with zero project management hassle, let alone actual work. These companies charge a huge premium for the "we take care of everything and hand you the keys to a finished product" aspect, and are not willing to work for someone who wants to do any of it themselves. A secondary issue is that they achieve the hassle-freeness by dramatically restricting choice. They typically offer just three options for everything individual thing (floors, counters, etc).

Basically, I get the impression that like >90% of the new home market comprises two segments: people rich or irresponsible enough to spend $800k+ on a no hassle custom house, and giant cookie cutter subdivision wastelands that large developers churn out. The optimal approach, with at least some significant portion done DIY, seems to be a corner case. There is of course the MMM approach of doing even the foundation and framing yourself, but I think that's probably too hardcore for even most people on here.

Finally, about the land itself: as @Fishindude said, that's the most important part. Unfortunately, just as with buying existing houses, it's a real balancing act, maybe moreso. If a plot is perfect - great location in a great city, nothing weird to make building hard - then there's already a house on it, lol. You should go into the search expecting to live on the outskirts, or accept some other tradeoff. For instance, our otherwise perfect land comes with a covenant with several pages of intense restrictions on what you can build (that were fortunately almost all what we would want anyways).

Good to hear about @texxan1 's experience - that sounds like what we want to do, but are still a little apprehensive about how much of a mess it might turn into. (We're also intending to do almost all the interior finish/fixture stuff entirely ourselves).

asauer

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Re: Has anyone purchased land and built a house?
« Reply #11 on: February 16, 2021, 06:17:02 AM »
Thanks all!  We are definitely up for doing some of it ourselves and will definitely keep zoning/ HOA in mind.  We have a super stepford HOA right now and it's killing me.  Ya'll's advice makes me feel so much more hopeful that this is something we can pull off!

zolotiyeruki

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Re: Has anyone purchased land and built a house?
« Reply #12 on: February 16, 2021, 09:09:59 AM »
There's another thread on almost the same topic just down the page a bit, with some more thoughts: https://forum.mrmoneymustache.com/welcome-to-the-forum/designed-built-a-house/

sonofsven

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Re: Has anyone purchased land and built a house?
« Reply #13 on: February 16, 2021, 10:45:41 AM »
I've been building spec houses the last few years, I moved to this from a career spent building custom houses for clients and big remodels, but also small repairs for long term clients, too.

I like it because my partners and I make all the decisions without clients mucking up the process (sorry!).

As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.

The mobile has value (maybe!) and it's movable. The last one I got I sold on craigslist for $10k. The buyers paid to move it to a park where they did some minor upgrades and had a three bedroom rental. I was not interested in renting a mobile. I made a deal with myself to never work on mobiles...

The land was ready to build, it had a driveway, power, water, and a septic/drain field already installed. I replaced the septic (obviously) but was able to save money there as well since a repair permit is less expensive than a new system permit.

For us it's different as we need to sell the place, not retire in blissful fire-ness, but the quality of the land is a huge part of making this work.

Another project had an old shop but was actually a buildable lot, that one I found the out of state owner and made an offer. It was a sub standard lot (small) for the area, and even though we built a nice, small house it took longer to sell.

Once we built a few we had realtors come to us with raw land that was fabulous. But maybe not profitable.

We were able to buy one large parcel that could be split into three two acre plots (minimum size in our county unless the parcel is a lot of record, essentially grandfathering in old lots, not raw land).

This is how real builders do it: buy land wholesale in bulk.
Sell land retail with a fancy house on it.

However, the costs to develop raw land are huge.

Starting with the county process to subdivide the land. Then you get to pay for all these things to be brought on site:
Power
Water
Cable/phone
Access road
County process to approve access road
State process to approve access road tie in to state highway
Paving access road and driveways
Not enough water in small old local water district for fire hydrants on site so each house must have fire sprinkler systems installed.
Ok, now you're ready to dig a big hole and put a house in it!

Don't discount the time it takes for all this to get done.

One last thing, it's more cost effective to buy a house plan. There are so many it is possible to find one that needs few (ideally zero!) changes and still fits the site and your preferences.


asauer

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Re: Has anyone purchased land and built a house?
« Reply #14 on: February 17, 2021, 09:06:21 AM »

As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.


Great insight- I had not even considered buying a parcel w/ a mobile home on it. 

NorCal

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Re: Has anyone purchased land and built a house?
« Reply #15 on: February 17, 2021, 11:00:18 AM »
I looked into doing something similar with family land about 5 years back.  One thing I learned is how important it is to talk to people in the local area who have done something similar.  A lot of the issues that pop up are location specific.

Some areas have incredibly helpful inspectors and permitting processes.  Other areas have a permitting process that is specifically designed to prevent you from building anything.  Maybe your area has utilities that are impossible to work with.  Maybe you're in an area where wells and septic systems are hard to place.

The only way to know this is to talk to people in the area you're looking to build in.

In my case, we eventually found out the city would charge us somewhere north of $300K just to hook into the sewer line.  I also learned how much of an asshole my uncle (part owner of the land) actually is.  But that's another story.

nereo

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Re: Has anyone purchased land and built a house?
« Reply #16 on: February 17, 2021, 11:34:48 AM »


As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.


I think this is really region-specific. Certainly in high-growth areas of the country I can see this being the case, but there are other regions (like northern NE) that have endured multi-decadal population declines. Around here it's pretty common to find plots with either old, tumbledown derelict buildings or (occasionally) nothing at all.  It's a completely different mentality, and a whole different world from towns and cities that are actively growing.

ender

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Re: Has anyone purchased land and built a house?
« Reply #17 on: February 18, 2021, 07:17:33 AM »


As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.


I think this is really region-specific. Certainly in high-growth areas of the country I can see this being the case, but there are other regions (like northern NE) that have endured multi-decadal population declines. Around here it's pretty common to find plots with either old, tumbledown derelict buildings or (occasionally) nothing at all.  It's a completely different mentality, and a whole different world from towns and cities that are actively growing.

+1

If you want to build in a major metro area and live 10 min walking distance from downtown? Yeah, it's probably all built already.

But many areas of the country are not like this.

Dreamer40

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Re: Has anyone purchased land and built a house?
« Reply #18 on: February 18, 2021, 11:22:26 AM »
My in-laws just did this and moved in the house recently. A cousin also just finished buying their land and plans to do the same. They both bought empty lots in an established neighborhood.

After watching what they went through, I would never wish this upon anyone. It took an incredibly long time, had countless delays (covid and fires in the area didn't help but the work was also routinely held up while they waited for things like replacement flooring to ship), and cost way more in the end than if they'd just bought a house. They were stressed out for over a year.

If you're going to do it, find a house builder who is very highly recommended and you love. Somebody with amazing communication and follow-through. And make sure you have an agreement in place that they will fix problems and errors you discover after moving in. And be sure to monitor the work at least weekly so you can catch things as they go wrong.

Watchmaker

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Re: Has anyone purchased land and built a house?
« Reply #19 on: February 18, 2021, 11:42:06 AM »
I bought land this summer and am designing the house now. Hoping to build in the spring/summer.

Our 2 acre lakefront lot has electricity but no other utilities, so we'll need a well and septic. Finding a builder is/was the difficult part (I'm not certain we've found the right one yet).

sonofsven

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Re: Has anyone purchased land and built a house?
« Reply #20 on: February 18, 2021, 04:27:41 PM »


As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.


I think this is really region-specific. Certainly in high-growth areas of the country I can see this being the case, but there are other regions (like northern NE) that have endured multi-decadal population declines. Around here it's pretty common to find plots with either old, tumbledown derelict buildings or (occasionally) nothing at all.  It's a completely different mentality, and a whole different world from towns and cities that are actively growing.

Well if you're seeing plots with old derelict buildings then they are already built on. If you're buying for the land there will be a cost involved in removing them.
But I admit I am speaking from an area of high growth.
My main point was the costs to develop raw land are high. If you can find land that already has the infrastructure it's a great savings.
If some of that infrastructure can be sold and moved by placing wheels under it that someone else pays for, more the better.

nereo

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Re: Has anyone purchased land and built a house?
« Reply #21 on: February 19, 2021, 05:07:57 AM »


As someone said, most of the good land is already built on.
If you are in the country (I am), or exurbs, the most mustachian way to build is to find a good piece of land with an older mobile home on it.


I think this is really region-specific. Certainly in high-growth areas of the country I can see this being the case, but there are other regions (like northern NE) that have endured multi-decadal population declines. Around here it's pretty common to find plots with either old, tumbledown derelict buildings or (occasionally) nothing at all.  It's a completely different mentality, and a whole different world from towns and cities that are actively growing.

Well if you're seeing plots with old derelict buildings then they are already built on. If you're buying for the land there will be a cost involved in removing them.
But I admit I am speaking from an area of high growth.
My main point was the costs to develop raw land are high. If you can find land that already has the infrastructure it's a great savings.
If some of that infrastructure can be sold and moved by placing wheels under it that someone else pays for, more the better.

I spent the first ~30 years of my life in high-growth regions, and then shifted to areas undergoing depopulation. It’s definitely a different mindset. I understand your point but what I’m saying is that it is region-specific.  Around here it’s often the easiest and cheapest to build on empty plots, and many builders are actually gun-shy about building on previously developed plots because they are infamous for hiding expensive and hazardous problems (e.g. buried tanks, un-marked lines, contaminated soil, hidden foundation work).  We are focusing on un-developed plots for this very reason. Unlike in high-growth areas, there’s no shortage of available plots.

TheFrenchCat

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Re: Has anyone purchased land and built a house?
« Reply #22 on: February 20, 2021, 06:21:24 PM »
We've purchased the land, but haven't started building yet.  We're talking with a designer next month (he's super booked) and still looking into different options from modular homes, to self building with structural insulated panels (we'd have someone do the basement).  We'll be clearing the land ourselves and possibly doing some of the excavating since our family has the machinery to do that.  It's going to be a ton of work no matter what but it'll be worth it so we can live on this street with the rest of our family.  We wouldn't have done it otherwise, if we didn't care as much where we lived.  There are houses in our area for cheaper.