Is it cheaper to hire someone to build your own house?

Question

Just wondering. I go through our assessor's records sometimes, and look up people I know. My old friends parents house is worth 300k, but it says construction value is 77k.

Although I do know that if you hire someone to do it, they're quote for doing it isn't always accurate. My fiance's parents wanted to pay 200k cash for a cabin to be built, but after a year of building it.. the cost was 400k.

My friends parents house was built in '99, I know for sure that the price hasn't raised that much over 8 years.

Construction value: 77k
Assessed: @ 160k

A realtor once told me that the assessed value in this area is 50% of it's market value.

Answer 1

Hi, Wow!! 400K for a cabin? Must be nice!! Anyway, there are 2 sides to every story. Like bad car dealers, bad lawyers, there are also bad home builders too. I know one personally, he has made a nice living ripping people off on building their houses. He'll price a job for $150K, use the cheapest materials and labor he can get away with, while at the same time tell the customer he needs more money to get the job done, usually by convincing them they need something changed to make it bigger......a bigger house mean a bigger profit for him. He boasts about how much extra he made on a job, by convincing the homeowner he needed a 2 car garage added on. He'll get it built for 10K but tell the customer it'll cost 20K. I am considering building my own house now. I know i will have to hire out some help, but i think i can pull it off. I am considering a small house, i think i can build 1200 sq ft for about 15-20K if i do it myself. Right now i am studying and learning as much as i can about foundations, a good house needs a good foundation. I live in a trailer now, and i am still considering just adding a 6-700sq ft addition instead. It would be much simpler, and cost less to. I dont know where you live, i am in central Arkansas. When i lived in NJ, housing costs, labor, permits, inspections, etc were expensive. Around here, the costs are way less. And, you can get away with cheaper, low grade materials too. Just depends on what you want most. I already own my trailer and land, so if i build a house, i'd prefer to pay for it as i go, in cash. I never want a mortgage or rent payment ever again in my life. Prepare a budget and stick to it. Dont let a builder or contractor goad you into paying much more than the original bid............Good Luck!!

Answer 2

Not necessarily.

Some people have expensive taste and the amenities begin to add up.

Assessor's records are almost always lower, except when the tax person has over assessed it.

You can have a house built way back in 1950's worth over a million dollars, but only cost $3,000 to build.

Additional:
It also depends on your location and the housing market. In certain parts of California, it was over $200 to $300 a square foot.
The crazy architect attempted to tell me that it was because all the wood was being sent to New Orleans. Not true.
I kinda keep up on these things, so I knew better.

Supply and demand

Answer 3

The only way to save lots of money by building your own house is to do just that....Build it yourself. Frame, plumb, paint , carpet everything by your own hands.

The builder profit is small compared with what a inexperienced person will waste by their mistakes. And a house built with out professional help will never resale for as much as one that was built correctly to begin with.

Answer 4

Assessed values for property tax purposes are essentially meaningless as far as what a property might sell for.

A custom home will cost you more than a spec home and a spec home will usually cost more than an existing home.