Summary: Building a new home as a "rent to buy" home or a "rent to own" home can be beneficial to the builder, the buyer or lessee, and the community. It can also be a wonderful avenue to home ownership in a troubled housing market.
Dear Mr. Heldmann,
Hello, my name is Jessica and I was wondering about a few things concerning housing and building costs. I am working on a group project at school to determine a way to better our community. My group has decided to increase housing development in our town by using old, run-down houses, or empty lots to build homes to be used on a rent-to-own basis.
My question is for a normal urban house, with three bedrooms, and at least 2 baths, a living room, kitchen, and maybe a dining room, how much would it cost to build in KS? All of the dimensions for the rooms would be average. We estimate that the total square footage would be around 2000-2200.
If you could help us out it would be greatly appreciated!
Thanks for your time,
HousePlansandMore.com # 592-051D-0033
Hi Jessica, What a wonderful idea!
One caveat you need to be aware of is that your project will be a commercial venture as you are building homes for sale or rent.
That means that amongst other things, your builder or general contractor will have to be licensed according to state and local laws.
I would also suggest you enlist a local real estate/construction attorney to guide your real estate venture and protect the school. You will probably be advised to at least set up an LLC.
Also, be prepared for the red tape that might be involved in procuring the building sites, which are probably owned either by a bank or the local municipality, with back taxes and other liens attached to the properties.
Building the house is often the easy part of a venture such as you are considering. Sad, but true.
That said, I have a KS cost to build example at:Cost to Build a New House in Kansas. Unfortunately, it's a fairly expensive one. But that doesn't mean you can't do better. Here is an example of a 2,000 sq ft home that has a much lower cost to build. It is in CA where the cost to build is considered high.
Use the resources shown on that page and run your own estimated building costs in KS for simpler and less expensive home designs. You can do as many different estimates as you want to and it is free. You will find plenty of home designs on my New Home Plans page.
A 2 story home with a simple 4 corner foundation should be less expensive to build and more ideal for smaller lots.
Your design and quality selections on the cost estimating software will be critical to the final estimated cost.
You might also want to read my page on Cost Estimating.
The cost estimating process is easy and fun.
Good luck with your project. It sounds like it could be a win, win, win, situation.
It will provide benefits for both seller and buyer and will also clean up the neighborhood, increasing neighborhood home values and tax revenue for the local municipality.