Building a Home and a Company

2 Replies

So I'm brand new to this website and fairly new to real estate investing. However, my whole life I've been obsessed with houses and residential construction. Last November all the pieces of the Puzzle fit together and I've been working everyday to get closer to my goal of owning my own residential construction/real estate development company. I just bought my first investment property near the ASU campus and it was also my first transaction as a real estate agent...so it was quite the experience. Anyways, after reading books, blogs, articles all about becoming a home builder I find that that's exactly what I want to do....however I'm having a hard time figuring out the best way to get started. The best option I see would be to build my own house from scratch and then sell it...the main issue is funding and any information about this topic would be much appreciated thanks!

@Davis Kleven

 I have been involved in the home building industry for over 25 years. I can tell you that it is quite involved and challenging at times - especially working with subcontractors. However, with a lot of diligence, persistence, and preparation, you can build your own home if you can find a mentor to help you. I would highly suggest that you find a mentor that can help you get contractor pricing and their attention when you trying to build your home - mistakes can be VERY expensive when building a home and subcontractors typically have no patience with inexperienced builders.

Concerning the funding, you need to check around with banks and mortgage brokers who offer construction to permanent financing. This will save you money on closing costs and streamlines the entire process.

Good luck in your pursuit. Keep us updated on your progress.

It would be difficult to find construction financing for a spec build without a GC with a track record attached to the project. You may have the right idea with building a personal residence (easier financing) as a way to test the waters. Sell after two years and take advantage of capital gains exclusion. Rinse and repeat on a personal residence until you feel confident about building on spec or until you have the money to personally guarantee financing. That's how I would kick things off!