Buy land then build house / house land package / established home

[poido123]

Looking to get into the property market mid next year.

What is the best way to go financially? My parents say it's more expensive to land then build house than buying already established house with land or a land house package.

Can anyone shed some light on their experience? I want to make a sound investment from the get go.

I have friends of the family who are architects/ builders so that should help with costs.


Thoughts?

[RidonKs]

organize a community land trust

[Yoda]

Move to Dagobah you must.

[poido123]

organize a community land trust


Community land trust? Is this an American thing? I haven't really heard anything about it

[HitandRun Reggie]

If you have family that are builders maybe. Otherwise it would be much better to buy property with a home, even a beat up one, than try to build from the ground up. Depending on what part of the country you are in, permits can get crazy expensive. I looked into building a home on one of my parent's properties, and they wanted around $100 a sq/ft to build a very basic one, and that was before all the permits and fees involved. In that area I could have bought a 5 acre lot of land with a decent home that size for the same price.

Don't buy a manufactured home, they tend to lose resale value while a regular constructed home tends to increase in value if it remains in good shape.

[DCL]

you have never even bought your first property and you're already thinking about land acquisition and property development?? :oldlol:

if buying a house is fractions, real estate development is calculus. the load of work and experience are not even comparable.

you're not even at level 1 yet.

you should really start out with some books. asking questions on a message board will not help you at this stage. you have soooo much to learn.

[IcanzIIravor]

Looking to get into the property market mid next year.

What is the best way to go financially? My parents say it's more expensive to land then build house than buying already established house with land or a land house package.

Can anyone shed some light on their experience? I want to make a sound investment from the get go.

I have friends of the family who are architects/ builders so that should help with costs.


Thoughts?

I think it depends on how sound your finances is and the property market in your location. Do you have a good job and a nest egg saved up?

[RidonKs]

Community land trust? Is this an American thing? I haven't really heard anything about it
yeah i don't really know that much either but yeah it's an american thing. well it's been done in america to some success. look it up if you like. i'm not super familiar, but it's basically a system where people collectively own large tracts of land on which they live. when they move away, they collect equity that has accrued over the years... i think. but another idea is that by having a single entity own all the land in a large region, it keeps property values from ballooning since you're removing competition for land from the equation. it's becoming more and more popular given recent events.


here's a bunch of bullets from the wiki page.

[QUOTE]Nonprofit, tax-exempt corporation A community land trust is an independent, not-for-profit corporation that is legally chartered in the state in which it is located. Most CLTs are started from scratch, but some are grafted onto existing nonprofit corporations. Most CLTs target their activities and resources toward charitable activities like providing housing for low-income people and redeveloping blighted neighborhoods, making them eligible to receive 501(c)(3) designation from the IRS.

Dual ownership A nonprofit corporation (the CLT) acquires multiple parcels of land throughout a targeted geographic area with the intention of retaining ownership of these parcels forever. Any building already located on the land or later constructed on the land can be held by the CLT or can be sold off to an individual homeowner, a cooperative housing corporation, a nonprofit developer of rental housing, or some other nonprofit, governmental, or for-profit entity.[2]

Leased land Although CLTs intend never to resell their land, they can provide for the exclusive use of their land by the owners of any buildings located thereon. Parcels of land can be conveyed to individual homeowners (or to the owners of other types of residential or commercial structures) through long-term ground leases. This two-party contract between the landowner (the CLT) and a building

[poido123]

you have never even bought your first property and you're already thinking about land acquisition and property development?? :oldlol:

if buying a house is fractions, real estate development is calculus. the load of work and experience are not even comparable.

you're not even at level 1 yet.

you should really start out with some books. asking questions on a message board will not help you at this stage. you have soooo much to learn.


Ummm, I'm not building the house? I'm not sure what your point is here. Is buying a house or land rocket science? I never said I'm looking into property development or claim to know it all.

I am familiar with location to value and understanding the potential gain side, I'm just getting some experiences from those here who know and can share what they know.

You could read a hundred books but it will never compare to actual experience.

[poido123]

I think it depends on how sound your finances is and the property market in your location. Do you have a good job and a nest egg saved up?

Have close to a 10% deposit now and 15% by mid next year with 1, maybe 2 grants to assist with first home.

I work for virgin airlines and very solid job security.

[poido123]

yeah i don't really know that much either but yeah it's an american thing. well it's been done in america to some success. look it up if you like. i'm not super familiar, but it's basically a system where people collectively own large tracts of land on which they live. when they move away, they collect equity that has accrued over the years... i think. but another idea is that by having a single entity own all the land in a large region, it keeps property values from ballooning since you're removing competition for land from the equation. it's becoming more and more popular given recent events.


here's a bunch of bullets from the wiki page.



Hmmm interesting. We call that housing commission or housing under (NRAS) scheme here in australia.

Obviously the land of this housing would be what Americans call community trust land.

Thanks for finding that ridonks. Here's some rep :cheers:

[DCL]

Ummm, I'm not building the house? I'm not sure what your point is here. Is buying a house or land rocket science? I never said I'm looking into property development or claim to know it all.

I am familiar with location to value and understanding the potential gain side, I'm just getting some experiences from those here who know and can share what they know.

You could read a hundred books but it will never compare to actual experience.


your original post implied you were contemplating or wondering about buying land and building property. that's property development, mate. you don't even know the definition yet you want to participate in this endeavor?

i gave you solid advice, which is that you really should make a greater effort to get a deeper education in the process before you decide to dump a lot of money into something. there are like a million things that can go wrong in a developmental project that you're asking about. asking for simple restaurant recommendations is one thing for a message board, but you don't want to do it like that for a project like real estate investment. from your first post, it's pretty obvious you want to do something but don't know much about it.

and that's why i advised you to pick up some reading and absorb as much as you can. books will never replace experience, but you need at least some basic knowledge first. it's not rocket science, and your knowledge level doesn't need to be a 10 to do this, but you're like starting at level 0. reading some literature might help you carry that level to at least a 5 or maybe 6. you can't be lazy about it.

[poido123]

Sounds like you're a very literal person and I think this just went waaay over your head.


I brought up the possibilities of purchasing my first home. I did clearly say "building a house" not building "multiple houses" on the land. Property development would imply multiple houses and entering the property market would indicate that I'd be starting out with my first home...

[DCL]

Sounds like you're a very literal person and I think this just went waaay over your head.


I brought up the possibilities of purchasing my first home. I did clearly say "building a house" not building "multiple houses" on the land. Property development would imply multiple houses and entering the property market would indicate that I'd be starting out with my first home...

it doesn't matter if you build one or ten. it's the same rules. and the potential risks for errors are similar. you will be involved in a process that requires more attention from you than you understand because when those errors occur, you will be financially responsible for them. when you're building any property, nothing always goes according to plan. your job is to limit the costs from escalating when shit happens. if you don't even know what's going on, how can you prepare for them? it's not a casual manner like going to a restaurant and ordering a burger and then sitting back and doing nothing. you'll be putting down a lot of money so you really shouldn't take it so casually. like i said, you have to do your homework, really. you can't be lazy about it, be unprepared, and go with the flow or it'll be pretty expensive for you.

[poido123]

it doesn't matter if you build one or ten. it's the same rules. and the potential risks for errors are similar. you will be involved in a process that requires more attention from you than you understand because when those errors occur, you will be responsible for them. when you're building any property, nothing always goes according to plan. your job is to limit the costs from escalating when shit happens. if you don't even know what's going on, how can you prepare for them? it's not a casual manner like going to a restaurant and ordering a burger and then sitting back and doing nothing. you're be putting down a lot of money. you really shouldn't take it so casually. like i said, you have to do your homework, really. you can't be lazy about it and go with the flow or it'll be pretty expensive.


Burgers at a restaurant, buying house same shit. :oldlol:


Either you are assuming I haven't got a clue how to wipe my own ass or you're genuinely concerned and trying to offer help with that concern?...



Who knows. My thread question is simple. I'm wanting to know (from people's own experience) of what combination is best from a first home investment perspective. Nothing more.

[ISHGoat]

Burgers at a restaurant, buying house same shit. :oldlol:


Either you are assuming I haven't got a clue how to wipe my own ass or you're genuinely concerned and trying to offer help with that concern?...



Who knows. My thread question is simple. I'm wanting to know (from people's own experience) of what combination is best from a first home investment perspective. Nothing more.

from a first home investment perspective, unless your builders are like your direct family members, its always better to just buy a house.

there are way too many unknowns and risks when you buy a land and then build a house yourself.

[DCL]

Burgers at a restaurant, buying house same shit. :oldlol:


Either you are assuming I haven't got a clue how to wipe my own ass or you're genuinely concerned and trying to offer help with that concern?...



Who knows. My thread question is simple. I'm wanting to know (from people's own experience) of what combination is best from a first home investment perspective. Nothing more.


my point to you is that your whole approach should not be as easy and casual as asking around on a message board.

you asked a question about what's the best way to go financially. you should know that simple answer already if you knew what you're doing.

forget spreadsheets right now because i am not even sure if you know what math to calculate on the back of a napkin yet.

if you decide to go with a new house already built, you will always pay a premium to the developer. they're not building a house for you and aiming to break even. they've taken on all the risks and headaches for you, so of course, they're going to charge you more than what it cost them. they operate as a business.

but if you build it yourself, then YOU have to take on all those risks and headaches. the potential upside is that, if you know what you're doing, you might save some money because you have options to build according to your budget range and you don't have to pay a premium to any developer, but the downside is that if you don't know what you're doing and you mess up and let the errors stack up, you swallow all the associated costs or... you go to court with the builder or whoever.

right now, you don't seem to know what you're doing. asking around message board won't help because there's so much that you should know. you really should read some books first to get a better grasp of the entire process.

[poido123]

my point to you is that your whole approach should not be as easy and casual as asking around on a message board.

you asked a question about what's the best way to go financially. you should know that simple answer already if you knew what you're doing.

forget spreadsheets right now because i am not even sure if you know what math to calculate on the back of a napkin yet.

if you decide to go with a new house already built, you will always pay a premium to the developer. they're not building a house for you and aiming to break even. they've taken on all the risks and headaches for you, so of course, they're going to charge you more than what it cost them. they operate as a business.

but if you build it yourself, then YOU have to take on all those risks and headaches. the potential upside is that, if you know what you're doing, you might save some money because you have options to build according to your budget range and you don't have to pay a premium to any developer, but the downside is that if you don't know what you're doing and you mess up and let the errors stack up, you swallow all the associated costs or... you go to court with the builder or whoever.

right now, you don't seem to know what you're doing. asking around message board won't help because there's so much that you should know. you really should read some books first to get a better grasp of the entire process.


Ok good response.


The friend of family is an architect/semi-retired builder. Hes excellent at designing practical, energy efficient houses.


What you're saying here is pretty common knowledge for those with basic property experience/education, but I'm not disagreeing that there is always more to learn.

I think you underrate forums for ideas. It can actually help formulate an idea on what you already know or trigger something that you didn't quite understand or just simply forgot about.

[Clifton]

Well, I need to look more into this, but my first move is going to be to stop renting. To take the $1000 a month I give to a landlord and instead buy a house with a comparable mortgage so that I have that money when I move.

... and then you upgrade to a nicer house when you have your feet under you.

I think that's the normal track.

If you want to take it a step farther and have your third house be a house you build yourself and own the land... more power to you. I know people who have done it. It could be in my own distant future. But for now what you probably wanna do is just save up for a down payment and get an unpretentious "starter home" in a normal-ish neighborhood.

[ISHGoat]

Well, I need to look more into this, but my first move is going to be to stop renting. To take the $1000 a month I give to a landlord and instead buy a house with a comparable mortgage so that I have that money when I move.

... and then you upgrade to a nicer house when you have your feet under you.

I think that's the normal track.

If you want to take it a step farther and have your third house be a house you build yourself and own the land... more power to you. I know people who have done it. It could be in my own distant future. But for now what you probably wanna do is just save up for a down payment and get an unpretentious "starter home" in a normal-ish neighborhood.

yes, you should try to save a downpayment and purchase immediately. typically mortgage + property taxes + maintenence (if condo) is more than rent, but youll be building your own assets instead of helping someone else pay off their mortgage.

if you pay 1000 right now and you want to purchase a place with relatively similar conditions, i.e. size, location, how new it is, etc, be prepared to pay 1500 a month

[poido123]

yes, you should try to save a downpayment and purchase immediately. typically mortgage + property taxes + maintenence (if condo) is more than rent, but youll be building your own assets instead of helping someone else pay off their mortgage.

if you pay 1000 right now and you want to purchase a place with relatively similar conditions, i.e. size, location, how new it is, etc, be prepared to pay 1500 a month


Americans are lucky in that sense. The quality/size of housing you can buy is a lot better than here in Australia and a lot cheaper.

Buying really nice houses in australia in decent towns for 150k is unheard of. America you can.

[Cactus-Sack]

Go for it Trent. Buy as much land as possible, then borrow against it to buy more. I believe in you bruh.

[aj1987]

Americans are lucky in that sense. The quality/size of housing you can buy is a lot better than here in Australia and a lot cheaper.

Buying really nice houses in australia in decent towns for 150k is unheard of. America you can.
:oldlol:

Probably in an absolute shithole of a town. You really can't get anything nice in a "decent town" for $150k. Unless you'r definition of nice is a tiny >1000 sqft house.

Going back to the topic, you should definitely buy a house. Don't try to build one unless you are absolutely sure that you have someone who can help you.

Not trying to be a jerk, but is this a serious topic? Weren't you trying to breed dogs to make money just a while ago? And you claimed that you had led than $1k in you bank account..