02-14-2011 08:39 PM
How much does it cost to actually tear down a house and rebuild it ? Example : Suppose there is an existing house 1500 sq ft on a 6000 sq ft lot, how much will it cost to rebuild it ? Also, how difficut will it be to obtain the necessary permits ?
02-14-2011 09:25 PM
Depends on a lot of things. My friends who've re-build after a total loss said that their insurance paid close to $300sf and that did not cover everything. They had to skimp on some thing like finishes.
My friend who tore down an a-frame and rebuilt on the foundation (expanded slightly) build 1700sf two stories for $400k. In the 90's she flipped 12-15 houses a year and did a lot of her own work so she played general contractor and came in slightly under budget and a couple weeks over the plan. A G.C. would have added close to $100k to the job.
Best to talk with a contractor who works in your town/locale. Permits are a process and work needs to be done to code to pass inspection.
02-14-2011 09:54 PM - edited 02-14-2011 09:54 PM
$300 a foot is light in the bay area, at least in most jurisdictions. Can you give us an idea of where the property is located? You wouldn't believe how much difference the city can make in costs. The places with more stringent building codes, inspectors, planning departments can make things a LOT more expensive.
That being said, my sense is that $300 a square foot might get you a very plain build in one of the cheaper communities to build in, but not much else. Realistically plan more like $500 a square foot, especially if you are building it for yourself (its a lot easier to put in the plain or even lower end materials when you are just flipping than if you are going to live there yourself).
02-15-2011 09:19 AM
$500/sf? Wow. That seems about 2-3x what it should be. Most houses around here don't sell for that, and include the land their built on. Why would anyone do a tear down if it was so expensive to rebuild? (Except for the very high end locations like PA or Saratoga, where they can still make sense.)
In other parts of the country you can build for around $100/sf so $200-$250 should be enough for here.
02-15-2011 09:42 AM
An Archetect buddy has several house projects around the bay. 1story super basic addition no plumbing ie bathroom just wiring and foundation etc work he was seeing about $300 per square foot for the decent contractors. He said a desperate contractor might come in around $280-$250 but he would be very apprehensive about using them and be on site a bunch to ensure all is being done correctly.
He said two story structure addition with bath rooms etc $400 SQft easily.
These are just the house additions that price does not include tear down. A co-worker just finished a complete tear down and rebuild in PA last year. He said the tear down which they micro managed used recycling as much as possible ran him around $50,000 for a 1600 sqft home by the time it was all done and build ready. The new home was 1900 sqft but it has a full basement and the master is upstairs - not really a full two story more like a single story with a large loft which makes up the master. The foot print of the home is very similar to the original but with the full basement if you count that the house is almost 3000sqft. They went high end high tech lighting - LED lights etc standard water system and he said all said and done with the full basement the build cost was considerably higher than $600 a square foot. They had been in the original home for 18yrs and original homes in the area sell for around 1.2 -1.5 mill. His target was to have the build put them in a position where the home value and what they had in it was similar to the current market value. He said if they bought in the last 10yrs it would have made ZERO financial sense to do the tear down and new build.
02-15-2011 10:15 AM
Missing the fact that they plan on retiring in the house in 20yrs and have already been there 18.
By the way his wife owns a dental practice and he makes considerably more than the average Bay Area income also.
The point being the tear down is going to cost you and the bare minimum cost of a new build could easily touch $400 a square foot for anything thats not a flat slab single story 2 - 2.5 bath home.
02-15-2011 10:45 AM
I know they are building 3000sqft houses down my way with considerable more attention to detail then the peak trac homes and they are making profits at $500K including the value of the land. These are nicely built homes, so dont let anybody tell you it cannot be done for considerably less then $300 per sqft, the issue is these contractors dont want to work and fix the pricing.
02-15-2011 10:57 AM
Well back in the day my family was a major builder in CA. I can tell you along with any one who has built homes that building a tract home with crown molding is still far cheaper than a one off custom build.
Here is why
You have land purchased with a plot number- my brother actually is the guy hired to plot land for builders. That plot number yields a cost per unit. Then the bulk purchase of materials yields added savings. Then you have contractors punching out homes all busy on their part, foundation, framing, electrical, plummer, Wall and finishers etc also much cheaper to build many homes than a single custom one off.
Also to tear down an existing structure costs money and adds to your $ per square foot cost.
So Aqua whats your background and knowledge on this that can back up your claim that it can be done for less in the bay Area?
The person who asked is actually getting some very good information here and should fit what they find with their own discussions on the topic with any archetect or builder in the Bay Area.
02-15-2011 03:44 PM
Yeah, you cannot really compare the cost of a home to a company building a tract home to a custom build. There is a tremendous amount of cost savings in volume, not to mention that the companies often choose to build in places where the inspectors are more lax, planning departments fall over themselves giving breaks to developers, etc. But the big factor is the volume. It'd be like trying to compare the cost of Ford building a car to having someone custom build you a car.
There are also a lot of "non-building" costs associated with building a home, including demolition, grading, architecture, soil reports, civil engineering, planning department fees, permits, etc. While may of these are also present in tract homes, you only have to do them once, so you can spread the cost among the multiple homes.
To give you an idea, these non-building costs for our personal remodel ran about $100-$150 a square foot. Except for demolition and grading, none of that came from a contractor's bid.
Don't try and tie the cost of building to the cost of buying a home. They are all out of whack. There is no way it pays to custom build a home at this point in time in most Bay area cities anyway, not financially anyway. It only makes sense if you really want something you just can't buy anywhere else. The costs will just eat you up.That's actually one of the factors that keeps home prices in this area from falling too drastically.
You can talk about out of work contractors all you want, but it really isn't the labor cost that is driving it, it is the cost of materials and the massive amount of extra building you are going to be required to do to get up to current codes. To give you an example, our master bedroom was required to be built with massive steel beams to withdstand what i can only imagine would be a 15.0 earthquake or a nuclear attack. This is for a one story house on solid ground mind you.