Building Property trying to figure out what layout to go with!

[Brayton Smith]

Alright guys I need some advice. Do I lower my potential profit margin and go with a 4BD/2.5BA to be safe or should I be good with the 3BD/2.5BA?

I can build a 3 BR/2.5BA 1,855 sq. ft. with a 20 x 20 garage for 213K base price (plus other random fees) or I could go 4BD/2.5BA 2130 sq. ft. With a 20 x 20 garage for 230K base price (plus some other random fees) in a newly started subdivision in the nicest area of town. I got back the comps in the neighborhood and here are all of the sales since 08/2020:

4BR/2.5BA/2597 sq. ft.- 290K (two story, 27 x 25 garage)

4BR/2BA/2176 sq. ft.- 285K (ranch, 24 x 24 garage)

3BR/2.5BA/ 1836 sq. ft.-285K (two story, 32 x 21)

3BR/2BA/2143 sq. ft.- 273K (ranch, 27 x 25 garage)

This would lead me to believe that the purchase of the 3BR 2.5 BA would be the correct choice to maximize profit margin because there wasn’t a tangible difference in sales price (especially with the one that was 273K being a private sale sold before listing)

However when I go in Zillow and look at estimated value for each home it makes me a little nervous to go with a 3BR/2.5BA around the 1850 sq. ft. The values on the 3 BR/2 BA houses sold in the last 10 years are much lower.

3BR/2BA/1716 sq. ft. - 236K Zestimate (sold in 2016)

3BR/2BA/1738 sq. ft. - 240K Zestimate (sold in 2016)

3BR/2.5BA/2326 sq. ft. - 302K Zestimate

4BR/2.5BA/2478 sq. ft. - 311K Zestimate

4BR/2.5BA/2502 sq. ft. 339K Zestimate