Lot cost - Mr. Murray's Opinion

[Tracy]

Since Mr. Murray is in Georgia, where I am, this question is directed to him, but anybody else can jump in. I have already remarked on this forum about the frustration I've been having with finding an UNRESTRICTED lot in the north Georgia area. Well, today I went up to a development in Dahlonega, Georgia (Lumpkin County) which is about 70 miles north of Atlanta and about 50 miles north of my place of employment. Here are the stats - please tell me what you think.

This is a sub-division developed by a construction company specifically for manufactured homes. All homes must be double-wides or triple-wides, no older than 3 years. Must have shingle roofs and vinyl siding. Roads are paved and maintained by the county. "Georgia approved water system" - not sure what that means, but I guess it's "community water." (and not sure what THAT means, either). All lots are at least 1.5 acres. Lots are graded and ready to move house on. Driveways are asphalt paved. Septic systems are installed. Also has street lights.

The lots are nice - most have tall, mature hardwoods on them - very desirable, for me. (I hate to see ANY house just sitting on a bare lot!)

Now - here's the question: the prices are between $34,000 and $39,000. the company has owner financing at a whopping 14% simple interest, but I can get my own financing at 6.62%. If I do this, would it be stupid to think that they would accept less money for the lot - or would they want more? I realize that they're getting much more when the lot is financed at 14%, but wouldn't they be more interested in getting the full amount right away (or WOULD they?)

Is it possible that, even though the lots are already graded , that they might have to be graded again for any reason? How much money could I deduct from a manufactured home purchase, considering the above (septic, grading, etc)?

I'd like to keep my total purchase UNDER $90,000. Is it reasonable to think that I can get a very nice 1800 sq. ft. home for $50,000 (with no grading or septic included)? By "very nice" - I mean good insulation, good flooring (no Novadeck), 2x 4's, good carpet pad and no tackiness (i.e. wainscotting and ugly trim) and a concrete block foundation.

I talked to a couple of the residents there who had lived there for 6 months. They thought the place was great and had no complaints at all.

My main reservations are the price of the land and the 50-mile commute which may not be that bad because it's only about 10 miles from GA 400 and then it's just a straight shot down to my office.

Will appreciate anybody's input on this.

Thanks!

[rmurray]

The price is not all that bad....Not far from some of the counties we deal in near Augusta...Sounds like a nice development..

Most "buy here pay here" land sellers will take from 10 to 15% off...If they really wanted to finance these lots they would offer much lower interest rates...Most likely they would sell the notes to Litchfield finance...They specialize in raw land finance with rates from 14 to 15%...Lots of the developers here are doing that..

Most dealers do not quote including septic tanks in GA...Also most only have figured very basic land prep in the quoted price...I doubt you get much discount from the dealer...just be glad he will not to have to add thousands..

That 50 mile commute does not sound too good...Who knows...maybe someday you will find something closer to home....I mean a job..

The 50K for 1800 foot with 2x4 interior walls might be a little tough with Block foundation....Remember there is 7% sales tax..And you will need electric service...about $ 600......you would have to find a home for about 46K...set with block...and a/c...

You will have to bump your price expectations, lower your sq. footage or slightly compromise....You might get close with a Cavalier product...with lots of good features...Some very basic Hortons might work also (we just got 2 Hortons at 1680 ft that were factory sale homes that would fit)
...Just remember at your rate 5000 is less than 30/mo..

Make your offer contingent on final finance approval with about 60 days to close...I am not familier with appraisals in that area...but it does get a little tough in some areas...Good Luck

[Tracy]

When I mentioned deducting from the dealer price because of the existing septic, etc., I didn't mean that they'd give me a discount (I worded it wrong) - I just meant that without the necessity of having that done, I could consider the price of the house ONLY and not have to add on $10,000 (or so) to the price quoted to allow for the site prep and the septic tank. Everywhere I've been, they'll say "That house is $60k, plus $10,000 or so for grading and septic, and another $4000 for the block foundation." Also, I didn't realize that electric hookup was that much - the electricity, water and phone lines are already run to these lots - does that matter?

Yes, the 50-mile commute will get OLD, but I need to stay at my current job for another 14 months in order to be vested in the retirement system. Traffic is a killer once I get within 30 miles of my exit point so I don't know if it's worth it. I've had long commutes before and it's extremely stressful. Here's another example of elected officials using their power to "legislate out" manufactured homes, which, in turn, causes a lot of hardship on people who want VALUE for their money. But that's another subject........

I know you're in Augusta, but do you deliver as far as Lumpkin County?

Thanks for your information and good advice.

[rmurray]

"$10,000 or so for grading and septic, and another $4000 for the block foundation."

Both sound a little high...but from what you say..you should not have to have to add any money for site prep if the lots do not require any tree removal and the area is leveled out for installation..

Block with stucco should cost about 3K for the size you are talking about and the land is level..

"I know you're in Augusta, but do you deliver as far as Lumpkin County? "...YES

[Tracy]

Okay, here's what I want: 1600 to 2000 square feet. Lots of windows. WHITE doors. WHITE cabinets (kitchen and bathroom). B-I-G kitchen, preferably with island. No tiny secondary bedrooms. Light-colored kitchen flooring. 2 x. 4's in walls. Headers over doors. 16'"o.c. wall studs. Plywood flooring. No wainscoting. Would like a small front porch, but not critical. Good insulation. Open floorplan - but I don't want to walk in the front door and be looking into the kitchen. Separate dining area - i.e., NOT just an eat-in kitchen. Now, can Homestead provide all of this (or Belmont, or Cavalier or whatever other brand you might carry)? If so, I may cruise over to Augusta if the lot in Lumpkin County works out......But REMEMBER - I'VE READ RANDY'S BOOK !!!!!!!

[rmurray]

It is time that you call....I appreciate Randy's Books...As a matter of fact they have helped me sells 5 homes in the last 4 weeks..they all had Randy's books (thank you Randy)...(I guess I will have to buy these books soon)...If you go strictly by the book....There are only 2 lines in the SE that meet all of the requirements plus 1 is an Energy Star Home to boot (this program is newer than Randy's books...I expect his next publication will include info on
Energy Star designation)...Those lines are Homes of Merit and Jacobson...both of which we handle..

We stock Cavalier products..Homestead, Bellcrest, Brigadier and Cavalier...They will not meet all of the requirements that you have listed...Exterior walls are on 16" centers but interior are 2x3 on 24" centers...You have not mentioned floor joist or cieling rafters..both of which are on 24" centers in Cavalier products as well..From what I gather..Randy's books call for 16" centers here as well w/2x8 floor joists..All other requests you have made are no problems..Cavalier has great cabinets, fixtures, doors, windows, carpet...the list goes on..

Our second store in Augusta inventories Homes of Merit, Jacobson, Horton, Indies and Southern Energy Homes...All offer construction features like you have asked..some are standard...some are options...3 of these plants are pure custom and will build floorplans to suit you...All offer White kitchens..

Call me toll free at 888-706-0811 or email at [email protected]

[Tracy]

Sounds great! When I make up my mind about that 50 mile commute, I'll be in contact if it's something I feel I can do. I'm going back up there next week to look at the lots again. This is a big decision for me.... Thanks so much for your help.