During my time with a family, I witnessed their journey of purchasing land and constructing homes for a cost ranging from $40k to $80k each. The interesting part was that they managed to sell them for over $250k each. Subsequently, they expanded their venture by acquiring a significant amount of land, where they built six rentable AirBnb homes and a restaurant. This not only enhanced the beauty of the area but also provided a steady income stream, eventually resulting in a substantial profit.
But how did they achieve this? Through the insights gained during my time with them, I discovered 5 key strategies they implemented. Allow me to share these strategies with you.
5 Affordable Ways to Construct a Home
1. Opting for Concrete over Wood
One of the innovative approaches they adopted to build high-value homes at a low cost was deviating from the norm. In the United States, the conventional method involves using wood for home framing. However, by utilizing cinderblocks, they managed to achieve significant cost savings. This approach not only facilitated the construction of aesthetically pleasing Spanish-style homes but also required fewer laborers.
The Spanish architectural style played a pivotal role in enhancing the resale value of the homes. This style, commonly found in Latin America due to its cost-effectiveness using cinderblocks, offers advantages such as enhanced fire resistance, increased strength, insect resistance, and an appealing appearance. In simple terms, the construction process can be likened to assembling building blocks, where pallets of cinderblocks, a concrete mixer, and rebar were used to bring their vision to life.
For both external and internal walls, the construction was carried out using these basic materials, with a few inexpensive unskilled laborers providing assistance. When purchased in bulk, cinderblocks can reduce costs to approximately $1 per block or even less, although this may vary depending on the location. Furthermore, due to their substantial size, fewer cinderblocks were required to complete the construction.
For the distinctive Spanish-style homes, the exterior and interior were finished with stucco, providing a smooth and visually appealing finish while also sealing the concrete and imparting the desired aesthetic. In terms of flooring, sealed concrete was utilized, offering a visually pleasing and cost-effective solution that aligns with modern design trends. This approach not only eliminates the need for expensive tile or wood flooring but also provides a unique, cool-to-the-touch, and contemporary flooring option.
Employing cinderblocks also resulted in savings on insulation costs, as insulation can be a significant expense. By utilizing blocks that offer inherent insulation properties, substantial savings were achieved. However, it is crucial to note that while concrete provides insulation benefits in warmer climates, it is not an effective insulator in colder regions. Therefore, careful consideration must be given to the climate before embarking on such a project, especially in snowy areas.
Did they incorporate wood into the construction? Yes, they did! Wood was primarily used for its aesthetic appeal. With its natural beauty and the ability to be stained in various colors, wood served as a stylish addition, particularly in homes constructed with concrete. In many Spanish-style homes, a combination of white stucco walls and dark stained wood is a sought-after design. They extended the use of wood to the interior roof, creating a striking contrast.
One intriguing aspect was their utilization of wood sourced from their own land. By renting a mobile sawmill, they were able to produce custom planks on-site based on their requirements. This approach resulted in significant cost savings, as land clearance was necessary, and wood procurement can be expensive.
Did constructing these homes require time? Yes, considering the limited workforce and absence of contractors, it was time-consuming. However, apart from allowing for on-the-fly design modifications, the process served as a rewarding family project and artistic endeavor that yielded substantial profits. Subsequent projects became more streamlined after the initial construction.
Embracing an open design is crucial!
This entails creating space for large sliding doors and windows. This design element likely contributed to the high selling price of the homes. For instance, the kitchen featured a wall that was predominantly composed of sliding doors, creating an indoor-outdoor feel while cooking due to the expansive open layout.
Although custom sliding doors and windows entail additional costs, they streamline the construction process by reducing the need for extensive framing, thus saving time rather than money. To economize on interior room and bathroom doors, they opted for sliding variants that slide externally, resembling covers more than traditional doors. This approach not only reduced expenses associated with custom-fit doors but also created a visually striking effect. Additionally, the mobile sawmill was utilized for crafting wooden doors.
2. Commence with Cost-Effective Initiatives (Land & Plans)
While land acquisition can represent a substantial expense, it is a critical component of home construction. Factors such as location, views, and climate significantly influence the resale value. However, if cost-effective home construction is the goal, saving on land expenses becomes essential. Fortunately, affordable land options exist.
Surprisingly, it is possible to acquire high-quality land at a low cost. For instance, platforms like LandZero offer land in exceptional locations for $10k or less. From scenic locations in Hawaii to oceanfront properties in Washington, as well as land near wineries in Arizona, diverse options are available. Individuals who build on these properties are likely to realize significant returns.
Once the land is secured, the next step involves obtaining affordable building plans. Building plans typically range from $1,000 to $5,000 and provide a structured blueprint for the construction process. These plans serve as a starting point, offering a pre-designed layout that can be customized to suit personal preferences. By utilizing stock plans, individuals can save on architectural design costs, as the foundational vision and layout are already established.
3. Embrace DIY
DIY and save big! Seems daunting, right? Not really, times have changed. Consider how people in the past learned to construct homes. They would observe and learn from others, then try it themselves. You might make mistakes, but you'll learn from them until you master the craft.
Nowadays, we have the option of YouTube. For every aspect of home construction, there's a video tutorial with an instructor guiding you. There are also books, but watching someone demonstrate is likely the most effective method. It's true, the individuals who built the homes I mentioned earlier learned from YouTube. You can do it too!
Need Assistance? Don't hesitate to seek help, in fact, you'll probably need it, at least for manual labor. If you're confident in your abilities to take on the project, hiring basic day laborers can expedite the process. You can hire someone for as low as minimum wage, enlist the help of friends, or even involve volunteers eager to learn. If you're concerned, you can have a contractor provide guidance. A contractor can visit occasionally to offer advice, allowing you to still save significantly. You can oversee the team but benefit from expert advice on necessary tasks. For electrical and plumbing work, you could learn from YouTube, but it's advisable to hire professionals.
4. Craft Your Own Interiors (Furniture & Cabinets)
Although this may sound challenging, it's not as difficult as it seems, remember YouTube! Look for modern yet simple furniture designs. If you can utilize the trees on your property and a mobile sawmill, the expenses may only amount to nails and other necessary components.
The handmade furniture was one of the most impressive features of the homes these individuals constructed. They crafted kitchen cabinets, bathroom cabinets, and various home accents. However, the truly remarkable pieces were the bed frames, stools, tables, nightstands, and other unique items. Consider the cost savings here! You could spend thousands on home decor.
The furniture didn't resemble perfectly shaped Ikea pieces; it actually looked superior. The items had a rustic, artisanal appearance, featuring slight imperfections that added character, making them one-of-a-kind.
Explore design ideas online through Google Images, searches like "DIY Bed Frame" can yield results with instructions.
5. Choosing the Right Location for Construction
Unless you already own the land for construction, be aware that the location will greatly impact costs, To an extent...HomeAdvisor offers a helpful article and calculator to elucidate this, allowing you to input your zip code and view the estimated construction expenses. You can access it here. Home Building Calculator.
As an example, according to HomeAdvisor, the starting cost to build a home in Georgia is around $100,000. In contrast, the starting cost for a home in Missouri is approximately $310,000. However, keep in mind, these figures are for professional construction companies, not DIY, and do not encompass the aforementioned topics. Nevertheless, the location of your construction project significantly influences costs.
Regarding countries, as part of a real estate company, I could delve deeper into this topic than this article allows. For further information, visit our Costa Rica Real Estate article. While it focuses on Costa Rica, the principles are applicable to many countries, particularly in Central and South America.
In essence, while some countries may offer slightly cheaper materials, the primary savings lie in labor costs. While this is a contentious issue in itself, the disparity between hiring a day laborer in Central or South America compared to the United States can be substantial, especially if paid hourly. Sometimes, the difference can range from $15 to $20 per hour. This variance accumulates based on the number of workers required. Additionally, fluency in the local language is crucial; trust me on that. In certain countries, individuals earn significantly less than elsewhere, allowing you to pay them above average and still achieve substantial savings.
While constructing a home may seem like a monumental task, it leaves a lasting legacy. Tools like YouTube are available to aid in learning. Yes, it may take longer to do it yourself, and there will be challenging days. However, in the end, life is short, and you've accomplished something remarkable. Moreover, you are now positioned to reap the rewards of your hard work. Enjoy!
