HML / OPM Can It Be Done

Jose71 profile photo

Hello Fellow Investors

I have a situation which I need some insights from other investors.

There is a 1acre of land for sell for 28k and I can have someone build a 2 floor house with 5 bedrm 3 1/2 bath etc. for 150k and the FMV in that general area is 400k plus..... I was informed that once the foundation is complete you can put it on the market.

I think it seems like an excellent idea but the problem is the funding....

Thank you for any insight

Comments(8)

  • Jose713rd February, 2005

    I understand what you are saying it do seem to good but the thing is I personally know the builder....

    the property is at is out of norfolk pass the chesapeke bay bridge... all he need is the material which would cost like 125 k, he charges me 25 k plus i have to buy the material and the land. So basically with 175-190 k , the house would be built energy efficient on a 1 acre....
    Now to me thats a deal if he was blowing smoke that would be a different story I like to follow through...right now im about to go get more information on the 1 acre because I have some that wants to purchase it so im going to talk to them and inquire some more insight.

    I would keep my progress posted it as I go......

    Keep the Faith and Invest time, time is money

  • Jose713rd February, 2005

    yes the 25 k includes all the labor period but unfortunately the acre was sold yesterday... but i will continue on my journey..there is alot of properties out here that needs some TLC.

  • fredman2263rd February, 2005

    yeah, the answer to your question is yes you can market the property before its built. Ive done several deals like this, if you would like more ways to get it done, just get in touch with me, too many ways to list here.

  • Jose713rd February, 2005

    Fred are you a builder ?? How far are you way from Norfolk ? Maybe we can eachother out right now I have 2 partners in NJ. Its a small company just getting on its feet. Hopefully we can move on up and make money.

  • fredman2264th February, 2005

    yeah, i have a company in charlotte and I do light development and new construction. I work with local investors as well as investors abroad who are looking for decent secured returns through real estate. Im always looking to work with others who are looking for the same.

  • raymo2815th February, 2005

    been a framer most my life and the answer is check you local laws. most places will allow you to put a property up for sale before it is finished but alot of banks like to see the building done one year after the hole in the ground is dug.

  • robshap16th February, 2005

    Right on MlJ!! The big production builders usually run about $90 to $100 sq. ft. I think this builder was offerring his services as GC for 25K.

  • mcole11th February, 2005

    Greeting irishgal,

    Maybe you could try telling her something like this….

    If she tried to do a conventional sale, it could easily take 2-3 months -- which she doesn’t have. But even if she did, she would be looking at roughly $14,400 in Realtor commissions and probably $3,000-$4,000 in PITI while she’s waiting for it to sell. Not to mention any penalties and fees that might be accumulating in the meantime.

    So at best, she’s really only looking at an “effective” price around $221,600 - $222,600 anyway. But the reality is, there’s simply not time for her to do that. And you’re offering almost that much right now, and you can get it done immediately.

    (and I like the idea in the other post... your offer goes down from here on out)

    Just a thought as to one way to approach her.

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