Question For Raleigh Builders

[Ryan Groff]

I am looking into doing some new builds in the Raleigh area and trying to evaluate what investors here would consider a good spread on New Construction. I found a lot near downtown Raleigh that has new builds at 2,000 sq ft going for $450,000. Could any builders/ investors tell me what their absolute top acquisition price would be for something like this?

[Will Kaufmann]

Ryan

I live in DTR and can tell you that the micro markets vary widely. "Near downtown" can result in a lot of variability. I found a great data source that enlightened me to how important specific zip codes are to pricing in Raleigh: https://datausa.io/profile/geo...

(posting via mobile so not sure that link will work).

I can actually throw a stone far enough that the ARV would be 10% less than where my house is. That is not a hyperbole but pure advice.

Anecdotal evidence as well, I recently spoke to a Durham GC that said his new builds are generally at $110/sqft so I would guess that a small premium add would be appropriate in Raleigh.

Last, on purchase price, definitely look to recent comps on lot or tear down prices for the frequent DTR developers (for example, Monarch). They are sharp but ultimately appear to be buying on-market deals (I think). If you are buying pre-market you can probably discount the comparable on-market deals to inform your lot value per acre (or square foot).

Feel free to reach out if you have any questions!

Will