All Forum Posts by: Rick Soto

@Rick Soto, as Chris notes below, a lender will require an experienced GC/builder.

As for the gap in profitability, yes it can be HUGE.  I have only bid out one new single family home in the past, and effectively to use a GC would have left me very little profit, within a margin of error that I could realistically see breaking even.  Now this is the one deal, with the one GC, and was a fairly difficult lot and was about 5 yrs ago.

Fast forward to today, and my plan is to partner with a builder on the equity side.  I put up the money, we jointly secure financing.  Builder has a full crew of employees, so will build house at cost.  Split profits.  I believe there is a very healthy margin in this relationship.  AND I get to be passive in the deal while making a similar return to if I tried to GC it myself, since I would be hiring subs are retail rates, where builder has them on salary.