Seeking advice on how to deal with a situation with an exclusive builder on a lot of land we bought.
My wife and I bought a piece of land from a builder back in February who quoted us at $175-$185 a square foot for our build then, with a fixed price contract. At this time lumber was at about $1,400 and oil was around $100. He stated lumber has been the largest variable so that could be what messes with the price if anything.
Fast forward to about a month ago, lumber is at $550 or so now (significantly down), we have designed a plan with the architect team and get quoted at $227 a square foot. We ask him how we can get it down to what he says is the current average right now $210-$215.
He tells us to make it a one story instead of two, and to remove some key features like a built in fire place on the porch and shrink the house down. So we make these concessions and just got our bid back again and its still $227 a square foot.
The contract for our land states that we must use this builder within 2 years or our builder has the option to buy back the land at the same price we sold it or relinquish the right to us to sell it or use a different builder.
I reached out to a local custom builder in the area who appears to do quality work just to ask some questions and he immediately knew what I was dealing with and who I was dealing with when I gave the general location.
He is quoting $150-$160 a square foot and actually has that advertised on his website unlike the other builder who just verbally told me a quote, and is able to bid out our plan immediately, so no large gap of time to say prices have gone crazy. He also said that someone in our neighborhood basically told the exclusive builder who sold the land that he will not be using him and is going with this new builder.
My question is, does anyone have experience in this situation of asking to use a different builder when the land was sold with the idea that the builder who sold the lot will be the builder?
A couple ideas I had were:
A. Request to use a different builder and see what they say
B. If they say no, offer $20,000-$40,000 to the builder to be released of the obligation. This will still save me $200,000 in the long run.
C. Sell land back and find other land (more expensive now).
My hope is that they won't want to deal with the headache of buying the land back and reselling it as they have like 40 other projects going on.
Sorry that was long post l. Appreciate any advice.
My wife and I bought a piece of land from a builder back in February who quoted us at $175-$185 a square foot for our build then, with a fixed price contract. At this time lumber was at about $1,400 and oil was around $100. He stated lumber has been the largest variable so that could be what messes with the price if anything.
Fast forward to about a month ago, lumber is at $550 or so now (significantly down), we have designed a plan with the architect team and get quoted at $227 a square foot. We ask him how we can get it down to what he says is the current average right now $210-$215.
He tells us to make it a one story instead of two, and to remove some key features like a built in fire place on the porch and shrink the house down. So we make these concessions and just got our bid back again and its still $227 a square foot.
The contract for our land states that we must use this builder within 2 years or our builder has the option to buy back the land at the same price we sold it or relinquish the right to us to sell it or use a different builder.
I reached out to a local custom builder in the area who appears to do quality work just to ask some questions and he immediately knew what I was dealing with and who I was dealing with when I gave the general location.
He is quoting $150-$160 a square foot and actually has that advertised on his website unlike the other builder who just verbally told me a quote, and is able to bid out our plan immediately, so no large gap of time to say prices have gone crazy. He also said that someone in our neighborhood basically told the exclusive builder who sold the land that he will not be using him and is going with this new builder.
My question is, does anyone have experience in this situation of asking to use a different builder when the land was sold with the idea that the builder who sold the lot will be the builder?
A couple ideas I had were:
A. Request to use a different builder and see what they say
B. If they say no, offer $20,000-$40,000 to the builder to be released of the obligation. This will still save me $200,000 in the long run.
C. Sell land back and find other land (more expensive now).
My hope is that they won't want to deal with the headache of buying the land back and reselling it as they have like 40 other projects going on.
Sorry that was long post l. Appreciate any advice.
