Prepare to buy this…
Welcome to the big leagues!
The other day I was touring a new home in Vienna built on an infill or tear-down lot. It was a lazy Sunday afternoon and I was on my way back from Home Depot when I spotted the open-house, so, I popped in.
The builder was there greeting visitors and I briefly overheard a customer talking to him about searching for a nearby house to tear down.
Although I know that the buyer was just trying to strike up a conversation and demonstrate his financial ability to buy an old house to tear down, but he really showed that he had no idea who he was talking to. Most buyers who are searching around and interacting with builders don’t have a clue that they are sharing confidential information with their competition who will gladly kick their ass to acquire a superior lot.
The frustration most individuals face is that they want to find an older house that, for example, feeds into Vienna ES where they can walk to the Farmers’ Market, W&OD Trail and meet friends at Caffè Amouri for coffee. Most of the house in town were built in the 1950’s and are, in my opinion, functionally obsolete for today’s family. And to make things even more complicated, each house is possibly near another dumpy house that looks like routine maintenance has been differed for a decade or two.
Ugh!
Pricing can be a big variable since lot values will depend on square footage, lot width and depth, and the street. For example, look at this tear down on Druid Hill Road NE in Vienna.
If this sounds familiar to you then here is some additional insight that may open your eyes.There are over twenty builders who have been concentrating on the Vienna real estate market plus there a dozen investors who are looking at older homes like a Monopoly game. My tip… prepare to pay cash for Marvin Gardens.
Here is what I recommend to clients who are planning to embark on a tear-down project:
- Lots are going to range in price from $550,000 to $675,000 if you plan to be in the Town of Vienna.
- Know how wide is the house that you are considering and how deep is it?
- Have a design in mind that includes the amount of square footage needed. If not, then maybe you need to meet with an architect.
- Location is essential so if schools and Metro are essential then let’s refine your search. A boundary line is important.
- Cash or financing? At this point it is essential to acquire the lot with cash… so it needs to be in place before you make an offer.
Do you know how long this will take?
What I find interesting is that most people don’t have a clear picture of the time involved and how that timeline impacts the entire project. If you think that you will buy a house to tear down, and then figure out what you are going to build… well, know that you are going about this all wrong. That scenario may cost your 18 months.
I can think of one example where, about six months ago, a homeowner sent an email telling me that she had bought a property and was hoping to get a few good builder referrals. At that point in time, she was already six months into ownership, and still had not found a builder. Time isn’t doing her any favors.
Although I shared the names of three excellent builders, here is another problem for you to mull over.
That builder you like so much, well, he is already totally busy. Yes, really busy with projects in his pipeline. And taking on another project with you is, sorry to say, not worth his time unless he is making premium money. Sorry, no deals for you!
Understand that I am not intending to freak you out.
Under Construction
But, I am trying to scare you straight!
Some clients of mine who are building a house right now followed my strategy from the outset. Finding the lot was, honestly, a total hassle. But in contrast to the woman who hadn’t even decided on a builder yet, they liked a local builder and an existing design and specs for a custom home.
Working together, they were able to make critical decisions immediately after settling on the tear-down that helped the demolition permit process get rolling in a week.
Now that is a quick turnaround to get a project started. They closed in June and the house will be finished in March. For a tear-down project in Vienna, that’s pretty close to a record for a builder let alone a couple doing it solo.
Not up for the project?
Do you know that there are New Homes in the Town of Vienna that are for sale? Some already built “spec-homes” aren’t listed on Zillow or Redfin. Let me know if you are interested in finding out more or want some guidance getting rolling with a custom home project.
