I own a home which I am currently livivng in. I've been bouncing around the idea of building another home behind the one im livivng in now. My question is how could I get the money back out of the new construction home?
Real Estate Agent · Raleigh, NC · Member since 2021 · 240 posts · 281 votes
3y
@Kalon Green - You've already got some good bread crumbs to start chasing from other responses.
I started typing up a lengthy post to outline all the considerations when building two houses on a single parcel ... but then I aborted the effort. The simple answer is that the easiest way to get your money out would be to have your land surveyed, and carve out a conforming lot, creating two distinctly different parcels of land. Then you can build one structure, and sell them independently if needed. If you have debt on the property, then you may need to check the terms of the loan before splitting up the land.
If you are building on one lot, and you end up with a single parcel and two houses, then you would likely need to refinance the entire property, putting both homes on a single loan as a way to pull equity/recapture your cash.
I work as a real estate agent and property manager around the Raleigh area. If you wanted to jump on a call sometime, feel free to give me a shout. I'm happy to help any way that I can.
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
3y
Are both homes going to be on the same lot? Have you done any CMA's on what that would be worth? You want to subdivide and cash out refi on the construction home separately to pull max ARV.
Real Estate Agent · Raleigh, NC · Member since 2021 · 240 posts · 281 votes
3y
@Kalon Green - You've already got some good bread crumbs to start chasing from other responses.
I started typing up a lengthy post to outline all the considerations when building two houses on a single parcel ... but then I aborted the effort. The simple answer is that the easiest way to get your money out would be to have your land surveyed, and carve out a conforming lot, creating two distinctly different parcels of land. Then you can build one structure, and sell them independently if needed. If you have debt on the property, then you may need to check the terms of the loan before splitting up the land.
If you are building on one lot, and you end up with a single parcel and two houses, then you would likely need to refinance the entire property, putting both homes on a single loan as a way to pull equity/recapture your cash.
I work as a real estate agent and property manager around the Raleigh area. If you wanted to jump on a call sometime, feel free to give me a shout. I'm happy to help any way that I can.