New Construction Homes- What am I missing?

[Jacob Kline]

I’m a brand new investor located in St Johns County, FL. It’s difficult to find flip or rental deals here so I plan on building entry level new construction homes to build my liquidity. I know that if my #s are right, the home will sell which will allow me to build/sell 2 on the next go round, etc.

I’m wondering if I’m missing anything here in my #s so far?

So here it is:

Bought the land at a tax deed sale, plan to build a 1100sqft 3/2 home (entry level) with my own cash.

Land: $2400

Survey: $500

Quiet Title: $2500

Plans: $1000

Permitting: $3000

Impact Fees: $0 (impact credit)

Water connection fees: $5200

Septic system: $10000

Construction ($85 per sqft): $93500

Cost = $118,100

[Greg Dickerson]

Originally posted by @Jacob Kline:

@Greg Dickerson then I would be subject to the contractor putting a markup on materials or buying extra materials for themselves, right? This is my first project, so would like to be involved at some level to learn the process and be able to build 2 after the first sells, etc

You should be contracting the job at a turn key guaranteed price so they can’t order extra materials on your dime. You do not want to do cost plus.

 The contractor can buy materials cheaper than you so the markup is a wash. If you supply materials any mistakes losses theft etc. is on you. If you let the contractor supply the materials any issues are on him.