Something that is happening fairly frequently lately, is that Homebuyers are becoming frustrated in not being able to find the right house, so they decide they will buy land, and build their dream house. My advice is not so fast. Don’t let your emotions takeover sound reasoning. There is a lot to consider. First, establish a budget, what do you believe is the maximum you are willing or able to pay for the entire project. Once you come up with that number, add another 20%. That is the average amount that is generally over budget on this type of project. When you do your initial calculations, make certain to take the following items into consideration. The cost of the land, including closing cost, if you’re not paying cash, you may be able to get a construction loan. Rates are generally higher for these mortgages. The next step, is to get some ideas about the cost of the infrastructure. They will include, cost of clearing the land in preparation of the house site, the driveway, excavations cost, cost of septic system, a percolation test, coupled with the Board of Health approval will give you information you will need to get a basic idea of the cost of the system. Wells are more difficult to pre-determine what their cost will be, mostly because they are based on a price per foot that they have to drill in order to get acceptable water flow. Sometimes a well driller can provide you with an idea based on wells they may have put in close to your house site. Don’t forget about getting power to the site, Generally the power companies will provide only the first 100 feet from the closest utility pole, the rest of the way will be your expense. How about landscaping in and around the house, what are you planning to do, a landscape architect can help with those ideas and cost. Doing your homework in advance will help determine if this is a practical idea, or simply an emotional response. Don’t take these decisions lightly.
