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Updated over 5 years ago on . Most recent reply
Should I sell my lot or build on it and sell it
I own a lot that I paid $41,000 for and can sell it for $95,000. Or I can build a house on it that will cost me all in $250,000 and sell it for $400,000. If I add the cost of the lot to my building costs , the number is $291,000 yielding a profit of $109,000 vs a profit of $54,000. Adding in 5% for the carrying costs , its about $10,000 more to build..so the difference in profit is $99,000 to build and sell vs. $54,000 to sell the land. What analysis would you use to decide the best approach? Thanks
Most Popular Reply
Thanks to all of your replies. I appreciate your time and energy in helping me to figure this out. I have actually built one house, a triplex, using a great builder and it really wasn't a bad experience. In this case however, I would be building a single family house, and so I do see everyone's point, that its best to make the quick profit, and reinvest, instead of going through a whole year of building and walking away with not substantially more. Thanks again for your help.