1st time home buyer need some advice

[Irtza Ali]

Hello, I am from Philadelphia and I am interested in purchasing a lot and building my own house on it. The lot is 1500 square feet and I was wondering how much will it cost to build a house? Also how big of a house can be built on a 1500 sq ft lot? 

[Garrett Sowle]

@Irtza Ali, I'm working through this exact scenario on a ~1300 sqft lot and I'm pretty familiar with the requirements in Philadelphia. It's certainly not an easy or quick process but it can be an excellent way to literally build equity into your property and get a home designed just how you like it. I've got a ton of contacts and resources if you are interested, just let me know what you need. 

I would account for ~$80-$125 per square ft for a GC to handle the construction depending on the level of finish. If the lot is zoned RSA-5 (pretty typical residential zoning in Philadelphia) you should be able to build on 70% of the lot if it's a median lot and 80% if it's a corner lot. Take that percentage of the lot to get the sqft of one floor then multiply by the number of floors you are looking to build. Capped at 38ft for RSA-5 would leave you with a basement and 3 floors usually. It is possible to get one more floor but it gets a little trickier putting in a deeper foundation with potential underpinning.

I used an FHA construction loan which is similar to the FHA203k renovation loan but they allow you to build ground up new construction for 3.5% down and you can even roll in the price of the lot.

Feel free to reach out with any questions, I'd be happy to help!