New vs old construction value

[Matt Rexrode]

Hey guys,

I'm working on the math to see if buying a lot and building a new house (or two) makes sense. 

Here's the issue I'm running into - 

I'm trying to figure out how to estimate what the new home(s) will be worth. The neighborhood I'm looking at is mostly comprised of houses built around 1970. 3 bed/2 bath and between 1200 - 1800 sqft. After talking with a builder, my plan would be to build a 3 bed/2 bath house around 1200 sqft. My agent sent me a few comp examples, but also mentioned that new construction would be worth more than the 1970s houses. Is there a good way to estimate the difference in value or should I just play it conservatively and do my math assuming my build will be worth the same?

Any insights would be appreciated!

[J Scott]

Find a good agent or appraiser who can estimate the value for you.

Also, consider that building a bigger house tends to be less expensive (per square foot) than building a smaller house, simply because you have more empty square footage.  But, bigger houses can often sell for the same amount -- or more -- per square foot.

You should do the math yourself, but something to consider...