If you want a basement and you live in an area of the country where the soil doesn’t drain well, such as clay soil, AVOID flat lots.

A sloping lot will provide drainage for your footing drains.

Another advantage of a sloping lot is that it allows you to design your house with a walkout basement with doorways or windows on one side to provide natural light and ventilation.

Also, in some areas the open side can be frame construction, which is a little less expensive than poured concrete or concrete block.

If you have no alternative to building a basement on a flat lot with poor drainage, be sure to hire a professional waterproofing subcontractor.

They will take extra care in waterproofing the exterior basement walls, providing footing drains that drain either to a sump pump and/or to a lower elevation on your property.

Be sure that local codes are considered as to where the drainage can be discharged.

If you don’t want a basement, try to find a relatively flat lot so that you won’t have an excessive amount of crawl space (or fill, if you decide on a slab foundation).

Building a crawl space is cheaper than digging a basement.

If the lot slopes on only one end or corner, though, it will not cost too much more to accommodate the foundation to the lot.

Notice that you are accommodating the foundation to the lot, not the other way around.

Buying land is a very subjective process, and the cost of land varies greatly in different regions of the country.

One very important tip on buying land is to always keep the resale value in mind. I know that may not seem important to you, especially since selling is the farthest thing from your mind right now, but some day it may not be. Remember, resale value is always on the mind of your mortgage lender.

I recommend spending no more than 25 percent of your budget on the land. While this is not always possible, and gets harder to do every year, it is an excellent guideline.

If you have to spend more than that, something else has to give, and that will be the size and/or style of your dream house. Size and style determine building cost. (Size more than style.)

You’ll have to juggle hypothetical scenarios in the planning process until it all fits into your budget. In order to do this, you will have to know upfront approximately how much it costs to build a house.

The actual “cost to build” anywhere in the US is the most closely guarded secret in the industry, but here is how you can find out what housing costs in your area by going to my web site byoh.com and using the “Cost to Build Calculator” found on the “Getting Started” page.

Another method is to find a new home being built by a professional builder that is for sale and that is similar in size and style (and quality) to your dream house and do the following:

Take the sale price of that house and deduct the land cost, real estate commissions, and 25 percent builder profit and overhead and you’ll have the real “cost to build.” The land cost may be a bit tricky to determine, but any real estate agent can find out for you. You could even call the builder.

All homes, even used homes, have the site value broken out separately on tax records. Now you simply divide the “cost to build” by the square footage of the heated area of the house and you’ll have the cost per square foot.

Square footage refers to the heated (livable) area of a house, but ironically it is determined by measuring from the outside surface of exterior walls! For example: a simple house that measures 40 feet X 30 feet = 1200 sq ft. (No deduction is made for the thickness of walls).

If you are successful in keeping your land costs at 25 percent of your total budget, you will have 75 percent of your budget left for the cost of building the house. Take that number, divide by the “cost to build” and you will now know what size (square footage) house you can afford.

Now you can start looking at house plans by square footage, and of course style (design).

Your book, Be Your Own Contractor, appears to have one blatant omission. On page 17, you write:

“Is it a buildable lot? This is the most important question to ask when deciding to buy a building site, and your local building inspection department is responsible for answering it in the form of a building permit. They will only issue a building permit if the property can be considered a buildable lot. Be sure to check with your local building inspection department before you purchase your site.”

So, you’re saying that I should retain an architect, survey the lot, test the soil, design a structure, have the plans reviewed, and see if a building permit is issued for my dream house, all for a lot I do not even own.

My city requires a site plan, floor plan, foundation plan, details where necessary, elevations and other plans, all submitted by a licensed architect, before issuing a building permit for new residential construction.

Even if a lot is buildable, a permit might not be issued for the design I want.

I’m obviously missing something here, and your book does not appear to explain it.

Chris

Lot with a small building envelope

Hi Chris,

Buying land is one of the most important components in building a home.
Besides accounting for 25% or more of the total cost of building, all real estate boils down to location, location, location. It is important to know as much as possible about the process of buying land.

When I wrote “Is it a buildable lot” I meant, will the construction of a home will be allowed IF, and only if it meets all the requirements, restrictions, and criteria of the local building inspection department, zoning department, health department, etc.

Lots or building sites in general, even acreage, are deemed ““un-buildable” for any of the following reasons:
• Unsuitable for a septic system
• Water tables have been proven to be unsuitable
• NO water available
• Inadequate road frontage
• Too steep for safe construction
• In a flood plain
• Too small to qualify for a home site
• Possible endangered species habitat
• Zoning may not allow a residence there.
• Been used as a toxic dump site at one time,
• There may be some mineral deposit there that is hazardous, such as asbestos, radon, etc.

However, even if a lot is deemed buildable, it may not be buildable for you because, as you say in your second to last sentence, “Even if a lot is buildable, a permit might not be issued for the design I want.” In other words, it may be “buildable”, just not “desirable” for you, or for your project.

But someone can and probably will find a suitable house plan for that lot.

I found a “buildable” lot that was undesirable because it had so many “easements” and “setbacks” on it that the space left for a house (called the “building envelope”) was considered insufficient by other builders to build a house comparable to the neighborhood. (See survey above) With a lot of planning effort on my part, I made it work! The house sold in the framing stage!J

Before you, as you say, “retain an architect, survey the lot, test the soil, design a structure, have the plans reviewed, and see if a building permit is issued for my dream house, all for a lot I do not even own”, you can talk to the building inspection department to find out FIRST if it is it is a “buildable” lot.

Then talk to them (You are NOT applying for the Building Permit at this time) as to what requirements or criteria that must be met for an individual’s house plan. (They are there to help believe it or not.)

They may require that the house face a certain direction. When a lot is a corner lot, this is often a point of contention. You may be allowed to apply for a variance.

They may require a certain percentage of the lot’s surface area be left permeable for proper drainage and you have plans for extensive paving.

They may have other guidelines for house design and/or house placement on the lot. Ask them!

Another source of placing restrictions on what you can and cannot build are “Restrictive Covenants“, also called “Deed Restrictions” because they are recorded with the deed when they are made by a previous owner of the land. They can be quite restrictive, and they are legal and binding as long they don’t discriminate.

Some examples of deed restrictions are:

• What size house can be built.
• What colors the house must be or not be.
• Which way your garage door must face.
• That you have to have a garage door.
• Driveways must be of a certain building material.
• What style of home must be built and/or what kind of siding must be used.
• Many, many other restrictions are often found.

By the way Chris, the seller should provide a survey of the land at their expense. (There probably already is an existing survey.) The seller should bear the cost of a soil analysis as well.

Chris, thanks for writing and helping me expand this critical subject matter.

Best of luck,
Carl