Quoted $18 - $45 per sf to build a New Home In LA

[Annunciata R.]

Hello BP,

I have advertised for lease on the shop window of one of my commercial units and yesterday I received a phone call from someone who told me that he has his own construction company so rehab should be easy for them. He charges $18 - $45 per sf to build houses. He told me the lower end would not include materials. He says he has the relevant GC licence that he simply needs to blue print to move forward. I don't have this yet.

Is this possible or have I missed something as this seems to be a rather competitive price. My guess is that at this price I probably have to pay for the permits and connections. Im not entirely sure but any feedback on how to proceed from here would be appreciated.

The lot that I would like him to work on will be my first in Los Angeles with many more to come so securing and building a relationship with the right team is important to me. For this location in Inglewood there is a definite ceiling in the area but here are my calculations:

Lot Purchase $12,000

Development $58,000 (1000sf)

Selling Price $150,000

Profit (if sold) $60,000

Thank you in advance

[Karen Margrave]

@Annunciata R.

@Annunciata R. When getting bids you always want to give each contractor the same facts, in order to compare apples to apples. I am not familiar with Ingewood, nor their permit fees, etc. Here are some of the things you need to find out.

• What size home do you want built?
• What EXACTLY is the service the contractor will provide. Is it strictly labor, or will he be in charge of developing the entire project for you from start to finish? (dealing with any govt. agencies such as Planning, Building, Schools, Fire, etc.) Is that work included in the cost quoted?
• What is included in the price he quoted? Is it strictly his labor or does he have someone that works with him?
• Who will be responsible for drawing up the plan, and is that cost outside of the price quoted? What will the cost of plans be?
• Who will deal with Engineers, Architect, etc.?
• Materials, who specifies materials, purchases them, and pays for them?
• What are all the permit and fees? There are times when those fees are higher than what is paid for materials.
• Who manages project?

There's really not enough information shown to give you a realistic opinion. I will say this,

• Any time you are getting work done, get at least 3-4 bids from licensed, bonded and insured contractors. Give them a DETAILED description of what you are wanting them to do, the full scope of the job, etc. and ask them for a WRITTEN BID, that DETAILS all that is included in the bid.
• Remember, you want the same quality materials bid on all the bids. You don't want one person quoting IKEA prices and the other Kraftmaid or one low end appliances the other high, the devil is in the details.
• Check their licenses on the California Contractors License Board (licensing) it will be under their name or their license #.
• Ask to see their "pocket card" and compare the name to their drivers license. (Is it really them?)

Let me know if there's anything else I can add to the conversation.