Building a house, is this normal ?

[tony]

My GF wants to build a house. She bought and paid cash for 10 acres.
The house:
2 bedrooms, 2 baths, a full poured wall (9 ft) basement with walk out doors.
A 2-car garage, open floor plan with "beams" running from the front of the house out the back for a covered patio.
A large pantry with a dog wash station. Steel roof, above average cabinets and counters.
Nothing spectacular, fancy.

Bulder 1- pretty much flaked out on her, removed things "accidently" from the plans. Finally told her to find someone else. This guy is a friend of her dads.
Builder 2 - Amish guy, his rough bid was $520,000!
Builder 3 - verbal bid was $350,000, we started the loan process. This builder is supposed to provide a contract and a list of materials.

All of a sudden, his verbal bid jumped to $520,000!!
WTF?! There is no way I'm signing up for a half million-dollar 2-bedroom house. I thought $350 was too much and was on the fence with that.

This is Athens County Ohio a liberal bastion centered in red southeast Ohio. If it were not for Ohio U, it would be red. So, in turn, these people love to tax themselves to death and then bitch about it Estimated property tax is $7,000. 00 a year.

Is it common practice for builders to fluctuate or change prices like this? The loan officer said there was no way this would appraise enough even for $350. It's like the twilight zone here. If you know it's not going to appraise for what we are potentially asking for, why even have use go through this?

 

[TX_Diver]

Seems like “normal” behavior. Finding a decent contractor can be hard.

A wide gap in pricing is usually a good sign to start asking more and more questions or get another budgetary price to sanity check everything.

 

[Silveroddo]

From what I've notice recently, builders/contractors/trades have been on such a gravy train post covid they've become like the handymen on the south park episode. My brothers been trying to get a price on a stick built shop addition. A close buddy of his grave him a price and from what we can tell there's $40k of labor in 3 guys for 3 weeks shelling up a 32x40x16' tall stick built shop, 3 walls, the roof, tin on the ceiling, no overhead doors, no electrical, no insulating, no concrete, just 3 guys. Works out to like $109/hr. When you talk to people about what they're paying to get projects done its asinine, but people are paying it so it continues. I've know several contractors that have just been throwing big numbers out to see who bites and have been staying busy for a couple years now.

 

[CMF]

What's the square footage?

 

[grfox92]

I think the biggest problem with recent rapid price increases in home building is quite simply labor cost. Wages have nearly doubled in the past 5 years due to the increased cost of living.

This should sound obvious, but as an example.....

An order of groceries from Walmart in 2020 that was $140 is $310 today. Thats every single item in the shopping cart matching from 2020. Houses that sold for $299k in 2020 are on the market right now for $599k.

The cost of material is not double from 5 years ago and actually has stabilized and went down since post Covid but still more expensive.

I priced out 1400 sq ft 3 bed 2 bath a few months ago. Material all in in, finished was around $100k. Add labor and subs and it is around $425k. This was for builder grade. MDF trim LVP flooring, single light in every room. Make it a custom homes with better finishes and it will be closer to $550k.

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[grfox92]

From what I've notice recently, builders/contractors/trades have been on such a gravy train post covid they've become like the handymen on the south park episode. My brothers been trying to get a price on a stick built shop addition. A close buddy of his grave him a price and from what we can tell there's $40k of labor in 3 guys for 3 weeks shelling up a 32x40x16' tall stick built shop, 3 walls, the roof, tin on the ceiling, no overhead doors, no electrical, no insulating, no concrete, just 3 guys. Works out to like $109/hr. When you talk to people about what they're paying to get projects done its asinine, but people are paying it so it continues. I've know several contractors that have just been throwing big numbers out to see who bites and have been staying busy for a couple years now.

For the crew of 4 guys I work with daily, it costs around $1500 a day to have us on a job site. We are a highly skilled group with the ability to build just about anything from commercial buildings, to elaborate custom homes to insane equine buildings and barns.

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[Mag_7s]

Building your own home can be one of the most rewarding and stressful things one can do. A lot of things will be tested, including your relationship. Through patience and grace it will be worth it. Have you thought about GMing your own project? If you can perform a lot of the work yourself, sub-out the work that you dont feel comfortable doing, you can save a considerable amount of money. You might get asked frequently why you need ANOTHER nail gun from your significant other.....ask me how I know.