Real Estate Development & New Home Construction

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Buying townhomes in bulk

Posted Jun 21 2019, 13:51

Is buying a townhome from reputed builder better or buying a land and having a contractor constructing multiple town homes better ? For a general idea, We are looking approximately 25- 30 townhomes in one phase.

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Greg Dickerson
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  • Charlottesville, VA
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Greg Dickerson
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  • Charlottesville, VA
Replied Jun 21 2019, 16:48

Time and cost will be your biggest factors. 

It can take a year or more in some areas to get approvals for a new development and then 6-12 months or more to do the work to produce finished pads to build on.

Starting with the raw land and developing finished pads to build can be costly and risky depending on location, site conditions, availability of utilities etc. so you will need to get the land at the right price to make this work.

You need to run the numbers and way the risk and time factors to determine if it makes sense to build vs buy.

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Replied Jun 21 2019, 21:13

@Greg Dickerson thank you for response. I see your point, it makes total sense. Just to add on, I live in Charlotte and the real estate market here is just skyrocketing. So finding town homes prebuilt or ready to be build from the builders are expensive . So I was just wondering if I could purchase a land and negotiate with builder or a contractor for construction;would that result in lower cost for the townhomes?

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Greg Dickerson
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Greg Dickerson
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  • Charlottesville, VA
Replied Jun 22 2019, 05:48
Originally posted by @Chris Vam:

@Greg Dickerson thank you for response. I see your point, it makes total sense. Just to add on, I live in Charlotte and the real estate market here is just skyrocketing. So finding town homes prebuilt or ready to be build from the builders are expensive . So I was just wondering if I could purchase a land and negotiate with builder or a contractor for construction;would that result in lower cost for the townhomes?

Yes if you can find finished lots ready to build  or find a subdivision underway you may be able to negotiate a discount on multiple units. All depends on how hot the market is