Best book on spec home building?

Question

Is there a good book out there that covers the fundamentals of spec home building?  That covers everything from the land acquisition on up?  I know, I know, I know everyone is going to say "you can't learn it from a book", etc...   But I am just looking for something that is going to provide a basic background in the fundamentals, more for me to be a investor in projects then to do my own project.  I want to get better with the terminology, steps, strategies around it and what can go wrong.  I have a long background in rentals and lending, just have never done or been a partner in a development project.  Thanks.

Karen Margrave · Answer

@Rob Cee  Spec building is a little different beast than other niches, but they all have their challenges.

Before jumping into spec building, you want to research the local market. Spec building works in areas where there is high demand, and little supply. Where rents on units are at the top end. That's when it might make sense.

You can learn more on BP than anywhere else, IF you hang out, and set up a system for researching the blogs, and podcasts specifically for what you are looking for (it's too easy to get distracted and go chasing rabbits otherwise).

Every region is different in what they require for new development. Even in the same region, the various areas can be completely different. For instance, here in Orange County, CA there are all the coastal cities. Depending on how close you are to the coast, you may or may not have to deal directly with the Coastal Commission. In some areas they allow the local building/planning departments to basically act on their behalf, depending on the proximity to the ocean, etc. Then there are the areas a little bit more inland, that may have issues with fire danger, water, etc.

There's no one size fits all when it comes to land. The land can also vary greatly, and there can be huge differences on costs to build. Is it steep, flat, sandy soil, clay soil? all of those things weigh into development.

and that concludes my lesson for today. Here's a few blog posts I did sometime back, they may help too. There's people with ALOT more knowledge than me on the subject that have written on BP, go snoop them out! Land Development

This one is first in a 4 part Series. You can find them by searching my name, then click on to it, lower right of page. So you want to be a developer

Manolo D. · Answer

Before a spec build, which is @Karen Margrave's specialty, you might want to do a "test" of your skills first, one major rehab, graduate to tear down, then take your doctorate level to spec building. This might be a one or two year process. This will give you much greater idea plus you will pick up some connections and small lessons learned on your way. Best educator is experience, and given this is $$$, tuition fee is really expensive if you fall on the pit and much more if you don't know how to get out, or worse, tap out. Sure, it could get you 100% return coc, especially if you're not hiring subs, but wrong paths could break your bank too.

To speed up the process pay a low tuition fee on your local architect and engineer to walk you through the process of permits, drawings, timelines, etc, half a day or a day should be enough on the details on the process of building, since you are paying for their time, ask ALL the questions you need. Take notes on fees, their experiences, etc. The time you read 2-3 books, is about the same time you get your questions answered, I wouldn't mind paying a hundred or two more for a specific q&a rather than reading. Spend a couple hundred doing things like this and cover those $10,000 pit falls. Hire two 60ish engineers/architects on the brink of retirement has invaluable knowledge.

Jared S. · Answer

are you going to act as the GC?  if you hire a GC to oversee, expect your profit to go down, obviously.

spec bldg yields about a 10% profit margin, so just make sure you dont have any big mistakes, etc.  and of course if the house sits, that'll eat away at profits.

maybe Karen Margrave can share the profit margin she generally sees but I'd expect 10%.

Rob Cee · Answer

Thanks @Karen Margrave I will take you up on your offer.  I did some research on Amazon and there are some books on investing in land and land development that might help with that piece.  And there are some books on home building that will help with that piece.  This is definitely an undeserved niche!  There are so many books & courses out there on buying rentals, apartments, flipping, wholesaling, but very little on spec home building.  And I have never seen a boot camp on spec building.  This is surprising.

Karen Margrave · Answer

@Rob Cee  I don't know of any books on building spec houses. However; that's what we do for a living, and if you have any questions you can message me, and I'd be happy to answer.

@J. Scott (my @mention never works for him!!) has written a few books that you might learn from. He does a great job at laying out the details, bids, scheduling, etc. On his personal home that he just completed last November, he had a live video feed, and it was very interesting. Anyway, check out his stuff in the BP Store! J Scotts Books - BP Store

Best book on spec home building?

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