Is it still worth buying land, build a house and sell it ?

[Guillermo Montiel]

Hi, I am thinking about buying land and building a house to sell it for a profit? Is there any one who can give some piece of advice? Land is located in Hesperia, California.

[Emilio Ramirez]

Guillermo. If you go to redfin you can search for recent solds in Hesperia with the keyword "new construction." Running this search shows about 20 new builds sold in the past 6 months ranging from about 300k to 450k. One result is as follows.

16050 Spruce St

4bed 2bath 1658 sf sold for 298k on 7/9/2019.

Sales history also shoes a previous sale of

40k in feb of 2017. 

So if we subtract the sales cost from the sales price we get 

277k

From that we subtract the cost of the land.

277k - 40k= 237k

Assuming the builder made a profit let's subtract that guesstimate 

237k - 40k = 197k build cost all in. Or $119/sf. Man... that seems cheap... 

Sometimes the builder is named in the listing. In this case, just the realtor. Give her a call and ask for the builder's name. Then you can tell him your plans and see if he'll price it out for you.