Build a house for sale in unprofitable

30.11.2010 07:45
Articles about real estate | Build a house for sale in unprofitable In the Kiev region today there are about 260 cottage settlements. Of these, about 35% are in the planning stage, about 33% during construction and about 32% of the partially built. In this fully completed and ready for sale just 10% of the total households.
With regard to frozen settlements, by comparison with I quarter of 2010 their number increased by 8%. Nevertheless, the proposal on the country market Kiev area has increased by 5-10 towns. This increase was primarily due to co-operatives, where there are undeveloped areas and proposes options for the separate sale of land or land with a construction contract.

If we talk about the demand for country houses, in August-September this year, it increased slightly. The main reasons are: a seasonal surge in buying activity, falling prices for existing home ownership, discounts and special conditions for potential clients, as well as the entry of land in the cooperatives with the possibility of self-selection of a contractor.

Related article: Demand for suburban market in Russia is approaching pre-crisis

Areas attractive to buyers, today (like always) remain loyal and prestigious Obukhov price Zhitomir.
Desired purchase price varies between $ 900-1300 per square meter. m, and the underlying demand for homeownership have cost $ 100 000-150 000.

Despite the reduction in the cost of construction, erection of homes for sale by a private individual is unlikely to bring more than 10-15% of revenue. An investor should learn the ropes on the market: when choosing a plot to take into account the existence of the necessary infrastructure to carry out works to attract specialized professional construction company, as well as provide for the costs of advertising and promotion of the object. Building a house of 125 square meters. m today would cost $ 600 per square. m, that is $ 75,000 per household. This is still necessary to add the cost of land in the 10-15 hectare - about $ 35,000.
Connect Communications, commissioning, obtaining permits will cost $ 15,000. On the landscaping will have to spend about $ 7000 and $ 3500 will be spent on advertising. As a result, the cost of home ownership will be $ 135,500. At a price of $ 1200 per square meter, a cottage will cost $ 150,000. That is the difference in the implementation - $ 14,500, given the fact that the cycle of construction and commissioning in the 9-month period, return on investment is not less than 12 months.
The above calculations show that the construction of houses can be quite cost-effective only in complex (scale) and efficient construction. In addition, the company implements major project receives additional 20-30% due to discounts on materials and save on construction costs.

With regard to the demand for self-erected houses, the buyers are, but to attract them will require considerable funds. Depending on the location of the cottage, its price, availability of infrastructure, the period of promotion and sale of the object is 7.2 months.
Eugene Chernetsky,
Director of Investment and Construction Company "Contact-Invest"
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