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I have a bit of a different situation that I an looking for guidance with. My wife and I own a large 6 bedroom 3500 sq ft home on 5.5 acres. We also care for our adult son who is significantly handicapped. We are looking to seriously downsize to a 3 bedroom approx. 2000-2500 sq ft single level house to accommodate us and our wheelchair-bound son. We Are finding it difficult to find a home to meet our needs in size and space for my son too get around.  We are thinking that we will need to build and so we'd like to look for property 3-5 acres and build a home suitable for our son. Our current home is nearly paid for and I'd like to sell our home to finance the buy/build. How do I handle this whole process so we come out at the same financial level as we are now with minimal mortgage increase?
Thanks for your help

Hi Chet,
I understand exactly what you would like to try and accomplish.  However, please keep in mind there is no magic recipe for assuring all will fall into place for you exactly as you hope.

If I were you, I would want some kind of general idea of what my cost would be before entering into any legally-binding contracts.  Keep in mind that when building, you will be charged heavily for any changes (change orders) made after construction has begun.  To prevent, or minimize this, I would begin writing down your wants/needs in a binder if you have not already started making notes.

I would suggest first locating a suitable tract of land you would be happy with.  If the land is hilly, your grading costs will be more expensive.

Second, I would decide on a house plan and have plans drawn up for a suitable home you would like to build.  You can meet with a draftsman for help in having plans drawn up.

Next, I would submit the plans and specs to several different builders for an estimate, assuming you have already found some suitable land to build on.

Whatever your final dollar figure comes to for the land and new construction, I would add, say, about 10% to 20% to this amount just to be on the safe side.  When you start selecting fixtures, windows, doors, etc., most people ALWAYS end up with a higher amount.

Energy-efficient windows and doors, along with insulation and a very efficient HVAC system, can make the difference in major utility savings over the years.

Once you are pretty comfortable with your house plans and any suitable tract of land, you could begin putting your plan into action.

When purchasing land:
1.   Make sure you know how it is zoned
2.   Make sure you know who your neighbors are (individuals versus commercial owners)
3.   Investigate whether or not there is any plan in place for any change in use for any property bordering or very near your selected tract of land; or if any new roads/highways are planned.
4.   Be careful of rollback taxes that a seller might want you to pay.
5.   Check into water and sewer.  Are public water and sewer available, or will you be required to drill a well and install a septic tank.  If well and septic are required, make sure to make any contract of sale on the land purchase “subject to” perk testing for a septic  tank, and check into soil tables so you will know if you will be drilling a sand or a rock well and what your approximate high-end cost could be.

For financing:
1.   Contact any banker or mortgage broker to get pre-qualified.
2.   Ask about a new construction loan wherein the bank will make periodic payments to a builder at different intervals of completion.  Inspections will be made at different intervals BEFORE a draw is given to a builder.
3.   I would, if you are able to, NOT let a builder finance the construction process for you and make periodic payments TO the builder.  Should a builder encounter financial difficulties and file for bankruptcy, you could possibly lose all payments made to an insolvent builder.  Trust me on this:  It “almost” happened to one of my buyer-clients who had advanced a huge sum of money to a builder who was about to “go under.”

I would also be on the lookout now for a good home inspector.  Many people think you don’t need inspections on new construction, very wrong.  I would strongly recommend hiring a good home inspector when the time comes and have periodic inspections before builder draws are made.  Let any builder you contract with know that you will have a private inspector making inspections for you.  Private inspectors usually inspect after a foundation is poured, after framing is complete with electrical wiring and plumbing lines in place (but before drywall is put up), and a final inspection.  Some inspectors may do inspections at other times, also, but the preceding inspections are a must.

I hope the above is helpful.


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I can answer questions relating to the purchase and/or sale of residential homes and land, including what a really good agent should be expected to do and/or not do; where to turn when problems occur; and questions regarding disclosure. I`m a Licensed Realtor in the Southeast since 1984 with designations of Broker, GRI, CRS, and CBR (Certified Buyer Representative). Current active and Life Member of Million Dollar Club, Certified by State Real Estate Commission to teach Pre-Licensing and Continuing Education courses, specializing in Agency. Currently serving on Grievance and Professional Standards Committees, and Education Committee in past.

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