Peggy Smith

ASSEMBLE A TEAM;

1. Determine how much you have to spend:You have decided that you are going to build. Now what is the next step? Before you go any farther you should sit down with a financial counselor from a lending institution and get an idea of exactly how much money that you will have to complete the project from the purchase of the land to the final nail being pounded and the landscaping completed. Once you have that number you can begin.

The very first question you need to research is: how much is it costing a square foot to build a house. This will vary from modular to stick built but with a few quick phone calls to local contractors and modular home companies you can get a ball park figure. Next you should have some idea how large a house you would like to have. Once you have figured that out you can multiply the dollar per sq. foot figure you got, add another 20% and that will determine whether you can afford to buy land and build a house. It will also determine how much you should spend on land.

2. Find a mortgage lender: You can ask your realtor for a recommendation. Usually they are the best source of knowledge because they usually know who is lending for construction loans, who has the best rates and who they trust. Once they give you several names you should call and see whose personality fits your style. They will work hard to get you a loan at the best rate that they can find.

(more…)

I have had several phone calls in the last couple of months from potential customers and past clients that have asked me about building. My standard answer has been, if you can find a home you like, it is better to buy than to build. But lately I have been rethinking this.

In the latest issue of Money Magazine (April 2008) there is an article (Dream It, Build It) about building your dream home. The article makes an argument stating that” now “might be an excellent time to build that home. It says that “behind the dark clouds hanging over the houseing market is a very compelling silver lining. The cost of building your dream house is coming down.”

Why would this be? Well, there are many factors, but the main one is; the cost of raw materials has dropped and contractors are not as busy as they once were. In interviewing some modular home companies I have found that the demand for modular homes is so far down that some companies are running on a skelton crew. What this means to you the consumer is; dollars are not coming out of your pocket. Money Magazine states that framing lumber is 18% cheaper thtn 18 months ago and that drywall is selling for 40% less.

Not only are prices dropping in the construction area ,but also land prices have dropped in Vermont; in some cases 48% of the asking price from 2006. This is not as true in resort areas such as Stowe. The list price of land might not have dropped, but the actual sale of land has done so. We have seen the listing price of large lots over 25 acres being dropped while the smaller lots prices have stayed the same. Overall, large or small lots have not seen a record number of sales, and this has lead to lower sales prices.

(more…)