re: Mortgage Rates Killed Me

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There's much more to it than this simplistic boomer mentality.

The barrier to entry is vastly different today than ever before, especially in regions where decent jobs actually exist. Add in the fact that most new construction in these areas aren't coming online across all price points. It's either low slums, or high end finishes. Nothing in between.

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This is true, but it's also not OP's situation.

He bought 26 acres and said he had plans drawn up, so it sounds like he is working with a custom home builder, not trying to buy a spec home. He has a lot more say over the features and finishes of his future home.


Gaff:

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Out of curiosity, how would you recommend someone do this when building? Obviously you have to have a ball park number in mind before you start. You budget for that amount, save a little extra for overages and surprises. The build process is 8-12 months. How do you prearrange leverage when the banks won't allow you to lock in your rate until the build is almost complete? Same for trying to ball park your final number a year out?

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I say this not being a jerk, just being honest - Plan for less home to start with, add on/upgrade later. You budgeted for some overages and surprises, but being that this was your dream forever home, you probably also included several wish list items that pushed up costs. Extra guest bedroom? Home office? High end finishes? Pool? Shop?
Nothing wrong with any of those things, but maybe pick one or two priorities to keep the initial price well below your comfortable budget, then upgrade with the others over the years.

You bought 26 acres - congrats! As you said, the value of that land has already gone up quite a bit in one year so it was a good investment. I work in development and land prices have performed better than pretty much any other investment over the past few years, still haven't really taken a hit when the rest of the economy started cooling.

One idea... you're not going to like it... sell off 5 or 10 acres and use that money to fund the gap. Not sure what area you're in but land is at a premium most places and there is likely someone else looking to build their forever home too. Maybe your future neighbor?