Chapter Thirteen: More Plans

Chapter Thirteen

More Plans

You must have some idea of the type and size of the house which you wish to build, when you meet with your draftsman. Single family homes are usually thought of in terms of the number of bedrooms. I am thinking now about every day, down to earth good old American homes, without a lot of embellishments.

It is a poor policy to start speculative building with expensive houses. If you do, you will tie up more capital and you will have reduced your prospective buyers considerably.

The most inexpensive house to build is a two bedroom, one bath, kitchen and combination living and dining room. They greatly appeal to older couples who have sold their monstrous old family homes and still wish the privacy of a single house. They need only one bedroom, but a second one is almost necessary for visitors.

These people are usually capable of paying cash, and it makes for a very uncomplicated deal.

But alas, as is the case with most seemingly simple ventures, there is a stumbling block. I refer to the cost of home sites. In most cases, the land cost will be too great to permit construction of a low cost home.

I have mentioned the matter because it could become an ideal situation, for someone who has access to lots at a reasonable price. Once the writer was fortunate enough to buy eight home sites for a nominal sum. He built the type of house described above. In each case, the house was sold before it was completed. There were no mortgages. Each deal was for cash and each one involved a couple above middle age.

Most developments today offer three bedrooms and two baths. One of the baths is for use of the master bedroom. There will also be a living room and dining room or dinette. And finally a kitchen and possibly a family room, not to forget the garage.

The most expensive rooms in the house are the kitchen and bath. Thus the more square footage that is added, within reason, the less the total cost per square foot. Another way of expressing it is that the kitchen costs just as much if you have one or four bedrooms.

I strongly advise a two-car garage, since it incurs the lowest construction cost in the entire house.

It is a good idea to cruise around in your territory and check the houses being offered in subdivisions. Are there any two bedroom, two bath homes? Do most of them have family rooms? In some parts of the country every house will have a cellar or basement, while in other areas they do not exist.

You will find in almost every case, that the women will make the decision as to whether to buy or not to buy. They are not at all interested in the guts of the house, but rather the convenience involved in living in the place.

For example, there should be plenty of closets. Bedroom closets should be large enough to walk into and preferably should be lighted. The kitchen should have ample storage space and the appliances be arranged for easy use. The dining room must not require many steps from the kitchen. As you go along, you will become privy to many other facets.

However, there is one thing that you will learn in a short time. And that thing is very important to your success in the real estate development business.

You will find that you can never anticipate the reaction of a prospective buyer to your property. For example, one might say, "I like your house very much, but I couldn't live in it, because the kitchen is too small."

The next one might tell you, "I like your house very much, but I couldn't live in it, because the kitchen is too large." You may spend days trying to dope out the perfect house. Upon completion, you will find those who are unmercifully critical and those who fall in love with it.

Luckily, all you are looking for is one person, who approves of the house and can arrange financing to buy it. You do not worry about competition, because your costs are lower than their costs, and you can sell below the market and still make a legitimate profit.

I learned long ago to build a basically simple, livable house and not to worry about selling it. After all, the buyers do not care a whit about my tastes. It is theirs that must be satisfied. The secret is to eliminate as many objections as possible. A simple plan does that and also holds down the selling price.

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