New Construction opportunity to get back in the business

[Jose Tovar]

Long time follower of BP.  Love all the info and great people willing to lend their expertise.  Hope I can contribute as well going forward. 

Now, my situation. I did SFR construction for 10 years under my fathers contracting company and with other builders. Been out of the game for 5 years though and I'm wanting to get back into it. (hate the office life)

I have an opportunity to build a new home for someone. We have a vacant lot at a good price available for purchase and with improvements we would be into it for approx. 90-100K. 1300 sqft SFR Structure would run anywhere from 110-125K. Total INV so far approx. 225K adding another 20% contingency cushion could be at 270K. We should be able to build and have it sold within 4-6 months. SFR home values comparable in size in the area range from 330-400K.

So long story long, my questions are:

1) Would it be better to have the end buyer purchase the land to ensure they have skin in the game and will see the project through to the end and still be our buyer?

2) What kind of costs would be incurred with Private or Hard money lenders?  Will they lend to the builder if the lot is not under our name?

3) Am I crazy to try and get back into this line of work while leaving a near six figure income job that pays the bills but does not stimulate me?

Thank you in advance for any and all input!