patrick.net

Your question is way too vague.

In San Francisco, you will generally not be able to build a new home SFH, you can take out everything except the frame which technically is just a huge remodel. Minimum cost is 250K, but closer to 400K-500K to maximize the size limit allowed by code. Most of the time, the numbers only make sense if you can add more livable space (3 story instead of 2, penthhouse and add a legal in law).

In Cupertino, my friend tore down his old home and built a new one, 600K for 2700 sq ft. Most people build the maximum allowed by code. The city took a big bite on that one in multiple angles. Certain cities are less menancing and you can tell who they are just by dollar/sq ft.

It is generally not a good idea to have the best house in the neighborhood, it is far better to have the worst house in a good neighborhood. From that perspective, new build $$ is also not very efficient in many neighborhoods. In Hercules for example, it will never make sense to build your own because the value added will not exceed the cost. Developers are more efficient building new homes.

Contractors have a severe advantage over non-contractors. That is because they have built in resource, permitting/expediting, that an outsider will not enjoy. What costs you 400K and countless headache to build is 250K + personal time to them. Nothing will frustrate you more than the permitting people who puts obstacle to add time and cost, contractors probably bribe the permit people to expedite things.

Building a new home is very akin to a remodel, you get more value on valuable land. It almost always make sense to remodel an old in nice part of San Francisco ($600+ sq ft) because it is easier to justify a return on investment, In Hercules (150 sq ft), the ROI is not there. Of course Hercules and San Francisco knows this and adjust for the extortion fees accordingly.

caveat, these are just facts as I understand them and you should consult a contractor who does this on a consistent basis to get the full story.

Thanks SF ace, your response was really helpful.

I'm thinking to build from scratch- by that i mean even leveling the ground, creating and foundation , frame etc.

Where are you thinking of doing this?

Definitely look at the cost of leveling and building a solid foundation -- I'm guessing that most of the only properties available are the ones where either leveling or foundation were prohibitively expensive.

Just be prepared to spend a lot of time on site managing things. Even if you've got a contractor, it's either in their best interest to do things as cheaply/quickly as possible if you pay them a fixed price, or it's in their best interest to do things slowly if they're doing it by the hour. Either way mistakes will be made, and you'll want to try and catch them early on. Luckily there are a lot of contractors looking for work now, so finding a good one shouldn't be that difficult.

While you don't want to live in an unfinished house, it's at least feasible if things start ending up in a cost over run situation and you have to put building on hold for awhile, assuming enough has been done to get a permit to live in the property. If the situation is massive during foundation/leveling, you're in trouble :) Finishing can also be done by other people, if you're unhappy with the workmanship of the framing and/or quality of the finishing the workers have been doing, look elsewhere.

I was actually wondering if it would be possible to find many of the building materials online, like craigslist. There might be a lot of projects that had to be put on hold, where the owners might just want to liquidate anything not currently nailed down. I haven't looked, and it's been awhile since the actual crash and/or stopping of most construction, but there might still be some good deals to be had.

Allright I just called San Jose City Planning department about the lot
at 841 Boulder Dr, San Jose and it is getting flagged in the landslide and earth quake fault zone.

She was telling me that it would take a considerable amount of time and effort to have any plan passed on this one.

http://www.redfin.com/CA/San-Jose/841-Boulder-Dr-95132/home/942286

cloud13 says

Allright I just called San Jose City Planning department about the lot
at 841 Boulder Dr, San Jose and it is getting flagged in the landslide and earth quake fault zone.
She was telling me that it would take a considerable amount of time and effort to have any plan passed on this one.
http://www.redfin.com/CA/San-Jose/841-Boulder-Dr-95132/home/942286

I see that nearby homes are around 550K to 800K. Assuming you can build it where it is worth more than any house in the neigborhood, it's potential is about 800K.

Now, the land is around 150K with transaction cost, which means that you have about 400K to build the home and bring it to 800K (around 2500 sq ft) value and allow a nice margin for error (550K cost vs. 800K value) and timing costs.

The next level of due diligence is to see what exactly is the geologiocal issue and the cost/time to fix it. What are the building restrictions in terms of building height, width, do you have to pay for light poles, signs, trees, infrastruture and other costs that the city will want you to pay for. If a contractor quotes 300K, assume at least 33% understatement and budget for 400K.

The city is great at extracting fees one step at a time. They get you committed and start to extort you slowly and surely with a whole list of direct and indirect fees. They know how much it is eventually worth and what you are willing to pay.

The thing I worry about is that the previous land owner could not make it happen and defaulted, which is a flag that it's not financially feasible or the margin of safety is not there. It looks like there are many similar lots nearby, but the majority have not been developed. You'll need to visualize how this area will develop in 10-20 years.

Zlxr says

Also - many hillside lots need to be engineered. Even if they don’t - you want to know if you can anchor your foundation to bedrock or sandstone. If the soil is really just excess soil pushed downhill from another excavation you could be in trouble.

The good thing about existing lots is that after 30 or 40 years - the soil has either hardly moved - or there is damage (which is either fixable or it’s cost prohibitive).

Bulls Eye, Zlxr. Excellent, expensive and often over looked point. And re the foundation comments: YES, get an engineer to check out the foundation, no matter how solid it may look. Get a report in writing.

This brings me back: About 10 years ago a friend's fancy lawyer husband decided to be his own GC. Drove around the site in the backhoe on weekends. We suspected he was fulfilling unrequited career dreams due to being pushed into law school, but whatever -that is Ellie Mae's field, not mine. Anyway, at 70% construction the house slid down the mountain embankment. Wasn't even in a high seismic area. Had no one to sue but himself. Stunning and twisted sort of funny. BTW, they got divorced.

There are some nice prefab houses out now as well. The construction cost for the prefabs is around $190 per square foot, or so I have heard, and they are substantially custom. Not trailers. No, not at all. Sparse-pretty, eco-conscious, modern. I would definitely consider work from this company if I had a lot to fill.

http://www.mkd-arc.com/homes/glidehouse

By the way, I have no connection with that company other than liking the way light washes through their pretty little houses.

Lot cost needs to be removed from the equasion, becasue it will vary greatly.
Also, remove the water/sewer (well,septic) because each area has their own connection fee / permiting fee.
Remove permit and school fees too .. big variance between areas.

2X4's cost the same in Frisco and in Fresno. So, a lumber/material package cost would be flat and can be used.

Foundation cost is pretty easy to estimate by anyone. Figure the total sq.yrds of cement (footings, piers, top, flat work) and call the local cement supply and get a per yard cost for 5.5 sack. Just take that number and double it and you have a pretty good idea what the cement will cost, forms set, rebar and plastic and sand, and to have it placed by a good contractor. If there is alot of hard ground or lack of access, then the price nees to be adjusted a little bit, but for the average job with average construction systems this is a good rule of thumb.

Framing a simple box at 8' high with simple trusses - $5 per lineal foot. Framing a complex box with 5 different roof lines and no straight walls - $10 per lineal foot. In any event, the cheapest way to get the home framed and roof stacked is with a framing contrator. The work will be "rough", so you and a few good friends acting like carpenters will follow the rough work and double check straight and plumb before the trusses get flipped. Add lots of extra bracing before the trusses get flipped. DO NOT REMOVE ANY BRACES UNTIL THE ROOF IS DONE - COMPLETED. Also, do not put in any windows or doors until the roof has all of the weight on it. Do not put any outside sheeting on or sheer paneling on until the roof is weighted. Yes, it matters if it's your house to live in forever. If it's a flip, stop reading my post!

Doors and windows are a flat cost. Installation will only vary a little bit. Paying a good pair of carpenters to install windows and doors will be the best bet and will cost about 30% of the door and window cost. So $15K in doors and windows will cost $5K to get placed correctly. Or close to it.

Sheetrock cost is flat, installation will differ by region due to wage costs .. but if the job is the right size for a contractor to make a profit you can get out of area contractors to come in and blast out a house. When it comes to the finished product, in my opinion, you should use the guys that work in that area in that climate and that want to retain a good name. Hanging the stuff is one thing, making it look good is another. The cost is based on the wall hight and how cut up a home is --- so there is no good "rule of thumb" for rock hanging. But, buying and installing your own would be twice as much as getting a contractor.

Insulation is cheaper to have installed by the supplier than to buy it and install yourself. It's cheap anyways. Figure $1.50 per foot and you will have money left over.

Stucco/outside finish - big difference in area nd style and supplier costs make this an impossible guess. $5 per foot gets a really good stucco job in the valley. No idea what Frisco would want.

Electric and plumbing is totaly dependant on finish choice. The labor is only about 20% of the job in these two area. Unlike cement or stucco that are as much labor as parts, electric and plumbing have mostly parts on the cost line. So, get bids with a break down betwen parts and labor. You may find it cheaper to by the parts directly (not normally, but possibly)

Anyways,
I am in position to build instead of buy. My desire to go this route was increased due to scumbag REALwhores. You se, by building my own I am not helping some lazy scumbag REALwhore make a buck.

Bap33 says

I am in position to build instead of buy. My desire to go this route was increased due to scumbag REALwhores. You se, by building my own I am not helping some lazy scumbag REALwhore make a buck.

Why do you lump all real estate agents into the "scumbag" category? Are you saying that ALL real estate agents are "scum?" Why is it considered a bad thing to "make a buck?" Do you "make a buck" or do you work for free?

Construction costs are one thing... but the land cost is the big kahuna now... except where plotted but vacant land exists (mostly exhurbs) the cost of the land can be the killer... because the cost of ownership of vacant, undeveloped land is so low (property taxes are often 10-20% of developed and insurance is very low... and with cash yielding 1% there's no opportunity cost)... landholders can afford to wait it out for-almost-ever.

Up my way houses continue to drift lower in price but the value of acerage is actually up.

Used to run $10K (2003) per acre of good, buildable land (free of wet areas and relatively level), now it's closer to $13K

I would be very careful in an area of active or potentially active landslides. A shallow slide is one thing, and may be feasible to remediate within a reasonable budget, but a deep landslide will generally not be feasible to repair. You will need to spend several hundred up to several thousand dollars to have a geotechnical engineer/ engineering geologist review the site and surrounding area for landslide activity. You would want to do this as part of you due diligence before you purchase. Once you buy it, you own any pre-existing conditions, and you may not be able to re-sell it at anywhere near what you paid.

IMO, you are better off buying lower down in the valley, just dont go too far down or you will have to deal with liquefaction :)

Building permits are extremely high. I know a guy that built a really nice 6 car garage .
Total cost was about 60,000 dollars. The permits were over $ 20,000

Cloud,

When I go up to the hills, what I notice is that all of the new construction up there is very elegant and very expensive looking. It appears like extremely rich people have spared no details, automatic gates like they're Hollywood movie moguls in the canyons and hillsides around LA, irrigation of big lawns in front of their estates, very long paved driveways, with all sorts of toys, some mechanical and some living like horses, parked on the property. Unless they've hidden their structures behind the topography, which probably a lot of them have, you can see it all because they have to cut all the trees near their structures due to the extreme fire danger.

That's it. Doesn't appear to be much of any other kind of new construction going on in the east foothills. Looks like, if I hafta ask, I cannot afford it.

Besides the very real landslide danger (and yes, there have been in the 1980's condemned homes of wealthy folks in the hills above Berryessa due to shifting ground) there is the very real fire danger. Moreover, you got to be rich enough to have people run your errands for you because it is such a hassle to drive down for a box of band-aids, jug of milk or case of beer.

@RayAmerican,
I was just in a bad mood. Plus, I would be happily buying some old REO if the local REmafia was not doing such a good job of keeping prices high and stupid buyers higher. Just frustrated with the entire REwhore scam. So I lashed out. My bad. I'm sure there are good used house sellers, just like there are good used car sellers.

RE: building permits. In most cases, if a lot has been newly created or rezoned you will need soils and seismic reports. If you are building on a lot that is part of a subdivision, then there that stuff was done when the map was recorded. You should not have to redo them.

Also folks, when 2011 gets here the new GREEN building rules by Lord Barry come into effect. NEW Home building will almost stop. It's Lord Barry's gift to REpros. No more new construction SFD's unless you are a millionaire.

What is being left out of the equation is acting as your own general contractor cuts the cost nearly in half. $75-$100 per square foot is IMHO way out of range today with the amount of these guys out of work. It is no longer 2005. I would tell anyone quoting that range to get lost.

$80,000 for a 6 month old 3 bedroom 2 story house outside Nashville TN in the mid 1990s on about 1/3 to 1/2 acre.

commonsense says

What is being left out of the equation is acting as your own general contractor cuts the cost nearly in half. $75-$100 per square foot is IMHO way out of range today with the amount of these guys out of work. It is no longer 2005. I would tell anyone quoting that range to get lost.

I agree with the above post. IMO, it's worth it to have anout involvement just to get real plywood instead of the engineered wood crap and at least 6" thick walls (or more) for better insulation.

I saw this on using shipping containers to build houses in Costa Rica. It seems with the huge trade surplus with China, North America is building up a huge surplus of containers.

http://www.containerhomes.net/articles-and-research/prefab-Homes-in-Costa-Rica-made-from-shipping-containers.html

I imagine if the Chinese were smart,they would abandon using shipping containers and use prefab houses directly as shipping containers,just fill them with "stuff" before their journey.

Do you still remember a story a couple of years ago where a homeowner in Hayward shot and killed 3 City Inspectors?
Are you sure you're not thinking of the 'Sausage king' who murdered three meat inspectors?

Home construction is an industry WAY over due for some major productivity improvements if you ask me.
I'm not sure concrete is the way to go, but I do agree with your assessment. Some form of factory built modular will dominate once the existing builders are crushed by the downturn. Don't ask me, ask Buffet.

Bap33 says

Framing a simple box at 8′ high with simple trusses - $5 per lineal foot. Framing a complex box with 5 different roof lines and no straight walls - $10 per lineal foot.

Is that materials and labor or just he labor?

Good contribution, very useful to see some real numbers.

Eliza says

There are some nice prefab houses out now as well. The construction cost for the prefabs is around $190 per square foot, or so I have heard, and they are substantially custom. Not trailers. No, not at all. Sparse-pretty, eco-conscious, modern. I would definitely consider work from this company if I had a lot to fill.
http://www.mkd-arc.com/homes/glidehouse

Last time I looked into prefab houses they seemed to be all rectangular an often narrow/oblong 1-story boxes. Have things improved? Can they do some nice L-shapes, can they be fitted with garages that break the monotony, etc? I've not seen a prefab with bay windows or other structure that makes then look a little more exciting. Any 2-stories at all?

I guess I'm looking for more links/websites if people have them.

Eliza, here you go. Approximately 6000 sq.ft. for around $250 per square foot. And it's absolutely everything I wanted. I didn't have to compromise at all.

On a lark I typed "open source homebuilding" into Google. Whaddya' know, there is a whole trend in open source houses.

Some examples:

http://www.madeforone.com/features/20050916_Open_Prototype_home.html

http://www.os-house.org/pages/os-house/home

http://ask.slashdot.org/story/10/07/06/1634242/How-To-Build-an-Open-Source-House

A varied the search terms, for example "open source home building" and "open source house".