Since I have built ten homes in the last several years, I will try to answer your questions. Most homes can be built for about 25% cheaper if the owner acts as the general contractor. Unfortunately, unless you have considerable building experience, I wouln’t recommend it. It is an extremely time consuming and, sometimes, frustrating endeavor. One bad mistake could end of costing you alot of $$$.
Can the current house be brought up to code without huge outlays of money? For the beginner, I would recommend this route instead of building. Or can you put a double wide on it?
Also, make sure the bank discounts the lot enough to cover the cost of the demolition. If not, you will pay more for the lot than it is worth.
Does anyone have any experience with building a new home? I’ve come across a bank owned property in very bad shape. The bank is selling it for the price of the lot (I’ve done the comps). I’d like to purchase the home, demolish it & build a new home on the lot then sell. Any suggestion would be helpful. Thanks.
Another thing you will want to do before getting into this property is to call the city hall where the property is located and speak with:
1.) the City Planner’s office
2.) The Zoning Commission
3.) The Code Enforcement office
4.) The Redevelopment Commission (if one exists)
Let these folks know what you’re about to do. Don’t be too specific. Just give them a broad overview of the area where the subject property is located. Tell them you’re looking to demo a home and rebuild a new custom home on the site (don’t say which lot). These people will then help you to better understand the following:
1.) What’s been happening with the area (growing/declining)
2.) If there are any ongoing plans to develop it further.
3.) Any unseen code issues that may come up in the future.
4.) Any planned Zoning changes or restrictions
5.) Any upcoming Re-Zoning plans that could be to your advantage/disadvantage
As Dewey said below, if you’re not experienced with this sort of thing, be sure to do your homework on it before proceeding. Building contractors are sometimes like sharks, when they smell inexperience, things can get bloody (smile)