New Investor - Chicago

[Seth Holmen]

Hello BP World! I'm new and wanted to say hi. I'm an architect in the Chicago area with love for all things building and investing. I currently work for a corporate real estate investor / developer. I'm personally in the process of my first "investment" property. I developed raw land and building my own house and doing all of the work myself. I found a beautiful piece of land (12 wooded acres) at a great value. It was unimproved when I bought it (no access or utilities). I'm currently about 75% done with the house and making  a hard push to get it move in ready by the end of summer. 

Here are the numbers:

12 Acres = $82,500

Construction Cost = $187,500 (This is 95% material costs only since I'm doing all of the labor) 

• 2,100sf 4 bed / 3 bath (+900sf of attic space for future finished space + 500sf covered porch) 
• The costs per/sf are fairly high due to the land development costs. I had to build a 1,000ft road to get into the property, remove 200+ trees, drill 740ft well, install septic, bring in utilities.   

Total investment = $270,000 

Appraised Value from bank = $440,000 

Sweat Equity (+$170,000) 

The land was purchased with a family loan and the construction is being done with a conventional construction loan. We will move into a 30 year mortgage once the home is complete. We will basically have $0 into the house once we move in since our sweat equity covers the down payment. Down the road will be to do a hybrid BRRR strategy where I will pull some additional equity out of this house and look for a 2-4 unit multifamily.