Is there anything wrong with this plan for residential construction?

I want to build a house that will cost about $100,000 for construction (permits, materials, labor)…

It will be on the outskirts of Naples, FL.

Home values there are high, so I think I can get at least $200,000 for a 2758 sq ft house.

Will the fact that it’s on the outskirts cause home values to decline?


Your total construction cost with permit, assessment fee's, burden, overhead, debt service, lot, closing costs and realtor fees will run you roughly 85% of FMV. I estimate your 2758 sq. ft. house costs you approximately $165,480 at $60 per sq. ft. just to build it, another $150,500 for indirect costs, fee's, lot cost, management, debt service, tap fee's, permit fee's, assessment fee's, architecture, soils testing, survey, etc. and you will need to sell it for $372,000 just to make a 15% profit of roughly $56k.

Your total overall costs will run you $316,000 dollars roughly, now you might make a few extra bucks buying the lot right, but you have a lot of costs to cover.

You can build a 1850 sq. ft. home and sell it for $250,000 and you will probable make about $37k building it. But it has to be the right house in the right neighborhood to make sense.

Now these facts above are based on you having the skills and abilities to build it and sell it in a timely manner. If you have to hire a general contractor to act as builder he will eat up most of your profit. A timely manner means basically 4 months for construction.


Your estimates are way too high.

What exactly is “management” and “debt service?” There are no realtor fees until it sells.

I have it itemized in a spreadsheet with everything itemized.

Have you ever built and sold a house before?

And a contractor does not have to build everything. I can do “cosmetic” things such as carpet, tile, cabinets, painting.


You start your original post by stating "I want to build a house that will cost about $100,000 for construction (Permits, Materials, Labor)."

You did not say “I want to remodel an existing house”!

I have been in the construction industry for over 40 years, I have a degree in construction management and currently hold engineering, commercial and building licenses or registrations in about 35 states.

I have now built over 250 homes for investment purposes, we build hotels, apartments, office and retail projects for our investment in Florida, I am also friends with principles in the Florida home building industry.

If you google home building costs you will find the average production / spec home makes the builder between 12 and 15% profit after all costs. Although I am not actively in the home building business I have unlimited resources to get real world information and data!
Try information from NAHB (National Association of Home Builders)

The only way a builder makes better margins are in the land / lot cost as subdividing and master planning a PUD can add to net income.

My family has been in the construction industry since 1935 and in mining since the late 1860’s so we have significent knowledge in engineering and building.

I learn new things every day, but I do know you can’t build a house for $36 dollars a square foot!!

             Gold River

I am building a new house, and I don’t care what Google says… I am basing that on my own very detailed itemization of materials, bids from contractors, and permit costs from the county.


I don’t want to sound sarcastic, but if you are so sure of your #'s Why are you asking for other’s input?

Doesn’t hurt to ask for help.

Maybe my numbers are wrong and he says he has lots of experience.

It’s a rather large investment, so I want to be sure, although I have spent a good amount of time on the phone with the building department, DEP, realtors, contractors, and personally pricing everything at Home Depot. I personally don’t understand the correlation between square footage and construction and material cost.

It doesn’t take twice as much wood to frame a roof that is twice the size.

It doesn’t take twice as long to pour a 2000 sq ft foundation than it does to pour a 1000 sq ft one. But, unfortunately, it’s the contractors who set the price. I think the key is finding contractors that will work for you for a reasonable price and not try to rip you off.

For example, I asked a contractor for a bid and he asked me “what’s my budget” rather than quoting what it should cost. To me, that means he’s trying to rip me off. It should cost the same no matter what the budget is.

You say you “don’t understand the correlation between square footage and construction and material cost,” after admitting your numbers may be wrong, but not really accepting what GR tells you is true?

All I can add is that GR has more patience than I do. Otherwise, it’s a lot like throwing pearls to something…

I’m just saying that it doesn’t take twice as many hours to pour twice as large a foundation… So why do they price such things by the square foot?

And if money is impossible to make by home building, then how does anyone do it?

Gold River,

If you can build homes for sale for a profit, why can’t I?

What do you know that I don’t?

If I can figure out how to do it once, I can do it 1,000,000 times.


          Keep in mind I developed my skills over years and years, it did not happen over night and although you have the exact same ability you would need decades to dedicate strictly to construction full time and a mentor like my father was to me to teach the knowledge that is other wise unattainable to you through commercially attainable educational institutions. 

The skills required even to build a house require knowledge of every trade in order to first know how long it should take? What needs to be done? Does it meet building codes? Can it pass inspection? Are the materials correct for the application? Is the workmanship substandard? Does the work meet and exceed generally excepted standards? Can you encourage your contractors to provide high end quality? Work with them on change orders? Provide advice and mediate issues without ending up in court with a lien against your property? Negotiate contracts? Create Contracts? Create scopes of work? Create critical path schedules for all trades? Understand how to work multiple contractors on one job site without screwing up there schedule or ending up back charged for causing unreasonable delays?

Do you understand the work process? Installation? How materials work together? What lead time is? How much time is required for drying time or between contractors? What process works best together? Whether to use primer and paint in one or whether to use a seperate primer and a seperate paint? What is nail size code for various wood attachment applications? What is the nailing or screwing patern on sheet rock? Where do you use fire rock? What are your options for vapor barrier? What is code for anchor bolts? When are hurricane straps required? What is required for header sizes? What is code for load? Live Load? What PSI concrete is required for what application? What is slump? What is a slump test?

You see this is a small fraction of things a builder needs to know? When you can figure out the process and how it’s done you will be ready to attempt building your own house!


I cannot sign an owner-builder because I am not going to live in it. Therefore, I have to hire a contractor to do everything structural. I have read through the Building Code before. I can easily find out about anchor bolt specifications, etc… But it isn’t even necessary because that is for the contractor to know. I can do carpets, etc…

Most of the things you listed are for the contractor to know.

I an Not a rocket scientist nor physics/math professor…however…I do hAve common sense enough to know that it takes TWICE as much concrete for a 2,000 square foot foundation as it does for a 1,000 square foot foundaton…maybe not twice a much labor but last time I checked concrete companies were not giving away concrete for the other 1,000 square feet.

Ron White the comedian says.

If you got bad eyesight…get lasik and get 20/20 back.

Got a bit of “Dunlap” (belly done lap over your belt),get a tummy tuck.

Got hearing problem…they can do marvels with the ear now a days …hear a needle drop at 20 feet.


“Not twice as much labor,” would be the key phrase.

How many homes have you built and sold?