Any builders just waiting for land to build on?

Question

Hey GCs and Contractors! Depending on what market you guys are in, are you just waiting to find land deals that meet your requirements? Here in NY the struggle is cost to build is creeping very close to home value, making profits slim. People think their land is worth 3x what it is, and some builders are jumping at any opportunity - which drives up the comps. They're making profit on 5 houses equal to what they would normally make off one build.

where do you have decent priced land and you will build build build because home selling price is that much higher than your cost to build?

Bryant Brislin · Answer

It's the same problem everywhere.  In California, we especially get killed by city fees (in various cities) that keep going up and up. City officials (electeds, planning staff, et al) don't know or care about how financial models work for homebuilders, they think of homebuilders as having a huge, fat margin to take from, and that's obviously not the case.  So the supply of housing of anemic due to progressive/left leaning city councils who regulate and tax us to death here.

Brooke Adams · Answer

@Michelle Pepe

We’re seeing the same dynamic here in Georgia, especially around Atlanta. Land pricing still feels anchored to peak comps, while build and carry costs have already reset, so the spread just isn’t what it used to be. A lot of deals we’re seeing only make sense if you’re getting in below market (off-market, tired sellers, etc.) or increasing density to make the numbers work. Otherwise, it’s thinner margins and builders making it up on volume.

Feels like we’re in a lag phase where land hasn’t fully repriced yet, but it likely has to if builders are going to keep deploying capital at scale. Curious if others are still finding consistent margins without stretching assumptions.