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Buying Property to Build a Home On



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By : Brandy Coffey    99 or more times read
With the home prices so low across most places in the US at present, there are many buyers looking to snag themselves the prefect piece of real estate. Sometimes that perfect piece of real estate has one major drawback; it already has a house on it. While some home buyers would turn around and just look elsewhere for another lot to build on, some home buyers are taking advantage of low prices and using those otherwise perfect pieces of real estate to build their homes on.

There are a few options for buyers who want to buy property to build on that already has a home on it; one is to knock the existing home down and rebuild on the lot. Knock-down rebuilds basically are just what they sound like; a home buyer buys a piece of property that has a home on it already and knocks the home down to make way for a new house on the same piece of land.

It is, however, not always a viable plan to plan a knock-down rebuild if you require bank financing. If the original home would be worth more or only slightly less than the new home, then you may have problems getting financing for your project. Lenders don’t want to fork out large sums of money for you to put a less valuable home on the property.

There are some alternatives to knocking the existing home down when you want to have a different home on that piece of land though. You can donate the existing home to someone and have them move it off the land if you live in an area that isn’t too difficult for house moving. It is expensive to move a home and have it disconnected from the existing systems and then reconnected at the new location. However, it can make a home much cheaper for someone if they can find land to put the home on at a decent price.

Another option is to not completely destroy the existing house but instead extensively renovate the existing home and add on or subtract from the existing footprint. This may appeal to a lender more than a demolition, but can actually end up being more costly, depending on the type of finishing that you choose and the condition of the existing home.

Whichever option you choose, it is good to keep in mind that if you can’t find your ideal lot to build a dream home on, there are many options that you can choose from instead; keep your eyes out for alternatives.
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