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startup homebuilder

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  • startup homebuilder

    I started my family homebuilding business back up in 2018 under a new name. My grandfather built homes since 1956, built the home I grew up in and took pride in his work. I had a home built for my family by a corrupt, abusive, unprofessional builder in 2018. It failed 18 pages of a 20 page home inspection and he put a lien on it to preven me from selling it. The way he treats his customers and the bad home he built inspired me to go into business, do things right, and charge for it. I sold the bad home as is 2 years later and it was a contributing factor in the breakup of my marriage and family along with a serious illness.

    Homeowners regularly build $400-$500K in the local market. The best homebuilder in the area is in his late 60s. He does at least $1M in revenue a year without advertising or having a website and is known on reputation alone. I have a tremendous respect for him but I don’t expect him to be building much longer, when he retires I’d like to take over his market niche.

    I am incorporated, insured, own land for development listed with a realtor contingent on building with me, assembled team of quality trade professionals, put some signs out, and am ready to build. 90% of my leads are coming from Google. Homeowners seem to want a brand of homes and that is what I am trying to establish.

    I have a family wanting to build, they own 12 acres, bought plans, cleared the home site, staked out their home, have a down payment and a bank loan. Their plan is a simple 1400SF ranch with no garage. It looks relatively low risk to build. Small kitchen, not many windows and doors, simple foundation. My price for a ranch with a garage is $175/SF which is pretty well spec’ed. I quoted $160/SF or $226K without a garage but am concerned with lumber prices. I knew all along business would take off and I’d like to get their home done and off the books this year in anticipation of bigger homes next year. I am willing to sign the contract in anticipation of lumber prices falling by fall and a market correction next year. I am willing to go down to $220K if they paint their own interior. They are hands on and want to contribute some sort of sweat equity. If I come in at $190K I will be happy. The builder who built my home charged $185K for 1450SF with a 24?30 3 car garage. He claims he didn’t make a profit but he’s a documented liar. He probably had $170K in it.

    My intuition is that things are going to take off and I’m going to be surprised how cheap it actually is to build a home. Customer is ready to sign. Any advice you can offer will be appreciated. Serious illness is almost behind me and I am counting on making up to my 6 year old son having to sell his new home 2 years after I built it. Living in a model home is one of my immediate goals. Things are looking up.

  • #2
    The fact that 90% of your leads are coming from Google is a promising sign of the brand you're establishing. Kudos to you for assembling a quality team of trade professionals and being fully prepared to take on projects.


    • #3
      It's understandable that you're concerned about lumber prices, given the current market situation. It might be a good idea to discuss the possibility of signing the contract with the family, while keeping in mind the potential for a fall in lumber prices and a market correction next year. Offering them the option to contribute sweat equity by painting the interior is a thoughtful way to involve them in the process.

      It's important to consult with a legal professional for us llc for non-residents who specializes in international business matters. They will be able to guide you through the process and provide you with the necessary information based on your specific situation.