Spec build or sell off?

[Jesse Ramirez]

So I’m in the process of finding my first deal but do not actually have one under the belt.

I was gifted a land in Timberwood park in San Antonio from my gma. If I sell the land out right I can get anywhere from 40-70k if I spec build and sell the house I could possibly make more. The houses in the area go for 300-500k I plan to use the land as a down payment (since I would own it outright) and then build and sell. Am I in over my head with this or should I go for it? Are there any spec building books you recommend?

[Jason Lee]

@Jesse Ramirez Timberwood Park is definitely a good neighborhood. I would start by finding strong comps in the area to determine a conservative ARV since $300-500k is a wide range. Be sure to pay attention to days on market, interior finishes, and extra amenities like pools. Next, I would get some inital contractor quotes on how much a new build will cost just for inital calculations. Once you have a good estimate on ARV, construction costs, holding costs, etc., then you'll have a more clear picture on what to do with the land. I would suggest to take into consideration ROI and annualized return. 6+ months of work for an additional $20k in profit might not be worth it. Personally, I think it's a big project for a first investment but it would definitely be a great learning experience if the numbers work. Either way, it's definitely a great opportunity!