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Updated almost 5 years ago,
Demo & Rebuild in Cupertino, CA Area
My wife is an interior designer in Silicon Valley. She comes across a bunch of investors who buy old homes, rebuild it and sell. So we are wondering if we can take up that as a business. Here are some initial numbers that I am trying to workout. Let me know if I am missing anything.
Purchase cost of an old house on a 7,000 sq ft lot - $ 1,800,000
Architect Fees - $ 30,000
Other Soft Fees (like Permits) - $ 45,000
Construction (3,000 Sq Ft) - $ 700,000
Finance Costs(Borrowing around $1.4 m for 2 years - $ 110,000
as primary residence mortgage)
Selling Costs (5% of $3.3 mil) - $ 165,000
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Total Costs - $ 2,850,000
Selling Price - $ 3,300,000
Profit - $ 450,000
Are these realistic? These will not be realistic if you are from any other part of USA ;)
Anything that I am missing? Any costs that I can reduce?