I know this is a loaded question and stuff changes daily. But how much could I expect to spend building on a lot in a neighborhood with access to power, water, and gas?

2 story, slab foundation, 3,000 sqft.

Something like this.



Just trying to get in the ballpark of what this would cost me to see if the lot I'm looking at makes sense.

A lot will probably be somewhere between $200k and 1MM depending on where you want to build and lot size. ~.75 acres in The woodlands would be $900k. A few acres just a outside of the woodlands would be around 500-750k. Rural Montgomery county is less depending on how far out you go.

Outside of lot cost, and if you get a builder to build it, the house you threw out there: $180/sqft is the low end of the starting range. So, $540-$600k as your low end. Right now, $210/sqft is good median ballpark so $630-$650k is reasonable median range. IMO

Thanks very much for the info. That's about what I was expecting.

Follow up questions.

What does financing look like for a custom home builder on owners lot? At close do they normally roll the land loan into the house loan? What are interest rates like on a lot vs a home?

Just finished a custom home in Montgomery county, plan on at least $200/sf. Does not include lot cost or pool.

Have at least 50k cash set aside above the build cost.

This market is turbulent from a cost escalation standpoint and supply chain. Order your appliances now some running 8-10 months.

Good luck.

The real property is the collateral so any loan for the land becomes part of the construction loan within the LTV limits. Construction lending rates are the highest they've been in a year.

In Dec. '20 we bought the personal home of a homebuilder in Montgomery County. He was building his own 'forever' home and stated that, from the time he priced out his own home to the time the materials arrived, he had an additional +35k in materials costs. The moral of the story is *ish is expensive for everyone in Montgomery Co. right now.

We're about to begin a build in Montgomery County.

We're looking at $280/sf. Doesn't include pool, lot, architect fees…

Yeah that's definitely outside my wheel house. Thanks for the data point.

I am building a similar (in size and what I assume to be finish out) house right now. It was estimated at $197 per heated foot in rural Madison County. There are many factors that can affect this SF price so it is somewhat inaccurate building techniques, finish out, amount of covered space vs heated, roofing, HVAC systems, etc, etc, etc.

For reference the above mentioned house (short version) will consist of:
-Single story.
-2 bed 2.5 bath.
-Stairs and framing for possible future second story expansion.
-Exterior stone wainscot with board and batt siding.
-LVP flooring.
-Stained cabinets throughout.
-All interior doors to be stained knotty pine.
-Trophy room with hidden door to gun room, all trim/cabinetry stained in this room.
-Spray foam insulated with a 2 stage HVAC system (required if foamed).


Short version, but should get the gist of it.

I am over in College Station, but would be happy to help with a quick, more accurate, cost estimation for you if needed.

Best of luck!

I'm just starting the process on something I hope will be similar to the original post. Looking for a lot is depressing. I thought I would be able to find a lot of ~2 acres for $300,000 or less. But that seems to be impossible unless it is in a floodplain or surrounded by trailer houses.

shhopkins said:

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Just finished a custom home in Montgomery county, plan on at least $200/sf. Does not include lot cost or pool.

Have at least 50k cash set aside above the build cost.

This market is turbulent from a cost escalation standpoint and supply chain. Order your appliances now some running 8-10 months.

Good luck.

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I'd have at least $100k contingency of cash if you're talking a home of $750kish. Pricing is so volatile right now. We're about done building a ~2500 sq foot custom home and I ate through $100k contingency easy. Granted a decent chunk was when lumber was all over the place and we timed it as bad as you possibly could, but my only advice to anyone building custom is to expect the worst and have a ton of cash in hand.

I don't know what other lenders are doing but we're adding 5% contingency to every budget.

Would you share the builders you have worked with and recommend? My parents have been meeting with one in Montgomery and they may need to talk to another based on the costs they are getting in estimate vs. the costs that were sold to them upfront.

Our recent build with a level 8ish builder (on a scale of 1-10 budget to luxury) is running us around $215 a sqft without some of the upgrades we decided on that have pushed us to about $230 now.

Ktownag, can you share some recos on builders based on your vetting? My parents own a lot already and have a house plan from architect ready to go.

There is a builder here in bcs who I know recently built a custom house in Willis - maybe give him a call? Gary E 979- 778-71 3 four

.

ktownag08 - i sent you an email regarding the homebuilders you are looking at. Let me know if you did not receive it.

That house, or something very much like it, is for sale on har.com.

Edit: nvm

Reply sent

ktownag08 said:

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Excluding lot, you're looking at $200+ per sqft of AC space depending upon finishes. Most coming in closer to 220-250 for me. I'm looking at 4500sqft, 2 story though so your price per sqft might be slightly higher given smaller home.

Been vetting builders in MoCo the last 8 weeks so have a good lay of the land what everyone is charging.

Thankfully we bought a lot in a community last year. Could already sell it for ~30% more if I wanted to let it go (I don't).

Good luck!

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I just bought a lot in Magnolia. Would you mind PM'ing me on your builder research?

Can't PM but username at yahoo and happy to help.

If still interested in exploring mortgage/construction money options, I would be happy to assist. RPM-MTG.com/bbazar

Question for you guys - with the increase in interest rates likely cooling off some of the red-hot demand, how will the custom homebuilder market behave relative to the existing home/new builds (from big homebuilders) market? I believe that in the latter case a fall in demand may be offset by a still tight inventory therefore leaving home prices somewhat elevated. But if demand falls off somewhat for custom homes, would that not apply downward pressure on pricing given that its more of a niche thing? I mean most people buy an existing house or a house from Lennar, DR Horton, Toll Brothers, etc. and not so much on the custom game.

Thoughts?

I bought land in MoCo 2020 with plans to build. Only planning a 2000 sq ft house with options to expand in future. As material prices skyrocketed, our estimate went over $500k all in for house, driveway, septic, water well, etc.

With what I have in the land, I would have been $100k-$200k over what a comp would sell for. Needless to say, I pivoted and bought in the burbs in Harris county . Maybe one day