Livin' La Vida Luna y Luca
Playa Bowls hit the spot after Tee-ball.
Introducing Project Roosevelt 🏡
I've been teasing Project Roosevelt for months.
We went under contract back in May with an original closing date of August 1st.
The sellers, however, made other plans. They've pushed closing twice, and it now looks like the clock will start on October 1.
Understandably so. They're an elderly couple searching for their next, and likely final, home. That takes time, and we're not in the business of pushing people out of their home.
In the meantime, we develop our plans and submit for permits.
Lather, Rinse, Repeat:
This lot is similar to Project Hillside, so we'll be running back the same floor plan with slight changes to the front elevation.
The Numbers:
Let's quickly run through the numbers.
We'll start with three buckets of expenses and end with our expected After Repair Value.
Acquisition Costs:
We're paying $712.5K plus another ~$30K in acquisition fees, which brings our total entry basis to $745K.
Cost to Build & Carry:
This home is smaller than the last few we've done, which explains the lower construction cost estimate. We'll be heavily focused on value engineering this build because our expected outsale is <$2M.
Including holding costs, we'll spend just under $815K to stand this house up. I'll be curious to see where we land against this budget. In a perfect world, we shave 1-2 months off the timeline and roughly 2.5% of the build cost to come in under $800K total.
Cost to Sell:
This will be our third transaction with the same agent. We went to market with one house and sold the other pre-construction.
The goal is to sell everything pre-completion, so this will be the tie-breaker.
After Repair Value:
When we originally signed the purchase agreement, we expected to achieve a $1,999,999 outsale.
Since then, a similar home went up for sale around the corner for $1.899M. We're hoping they go under contract before we list. Otherwise, we'll be hard-pressed to charge more for the same product.
Our floorplan flows better, but the home stats (beds, baths, sf, etc.) are too similar to command a meaningful price difference.
What's Next?
We hold our breath... in more ways than one.
Hopefully, the sellers don't push the closing date again. October 1 is already a slightly inconvenient closing date. We'll start excavating as the ground begins to freeze and enter framing in the heart of winter.
Also, we hope the fall market absorbs the comp above so we can shoot for our original projected outsale.
It's a base hit deal that has the potential to outperform. Looking forward to seeing how it plays out.
✌🏽&❤️