Hey Everyone. We are a small firm operating out of the DMV area (DC, Maryland, Virginia). We have a client who we need to send a proposal out to for the design of a custom home. The lot actually supports 3 homes and they would hire us for all 3, however they want to design just one floor plan and use the same thing on all 3 lots. The only difference would be some material change on the front elevations.
Another thing, they dont want some super custom home design, since they will be selling the properties. They want to use a sort of "generic" floor plan (I think so they can try to reduce the cost of design as well). We have some floor plans we can base a house design on but of course it still requires a similar amount of work.
How should we price this design out? I am thinking to break it down into the initial design of the home. Then an additional price per home and price for permitting (we will submit to county as well). I know its usually % of construction based but I am struggling to find a good fee to present them. Each home will cost approximately $1 million to build and theyll sell them for 1.6-1.7m.
I don't do SFR so my advice may not be the most appropriate. I know there are several users where who do SFR so they will be of more help with this.
I have done commercial jobs like this - several core and shell budlings that were very similar on the same site. While we did not charge a full fee for each building we did not give a steep fee reduction. I believe it was only a 20% reduction for the similar buildings. IE $120k for the first house, $96k for each additional house. Don't use these numbers though - it's just a 12% of construction fee.
One more thing - your client is asking for three custom homes. I don't care if they are a 'generic' floor plan. It's still custom work. Charge appropriately. You are providing value to the projects. If the client balks at this I would seriously consider not taking the work.
I have to agree with the last statement above. Without knowing a lot of context, each of these homes, even if identical in plan and scope are still subject to unique conditions such as underground utilities, vegetation, topography, privacy and most importantly light and shade.
These are all things I'm sure you think about, but (assuming these are three homes in a row) what conditions does the middle one have? When it hits the market, does it need to be priced $100k less than the two outer ones because it receives less light or has less privacy? I always feel like a middle unit has a bit less curb appeal as well.
I've seen builders and developers have this approach and in a tight sellers market it can work, but once a bit of inventory is sitting, the units with awkward floor plans and poor sightlines are a lot harder to unload for the seller. I've tried to have discussions with some builders about a space that's easier to sell and was once told "I'm an investor, I know that more bedrooms is better" without much regard to their size nor usability.
I think it could be entirely possible to create three identical houses that perfectly fit with each other, but there would need to be so much attention to massing and proper siting. This isn't the workload of one house being repeated 3 times, in fact I would argue it's significantly more.
Here's a good (or terrible) example of why you don't repeat four designs on one property. Years ago I looked at a neighboring property but was interested in following this one. The floor plans are awful, the houses have no privacy from each other, and there are so many missed opportunities.
Pricing out a custom home design
Hey Everyone. We are a small firm operating out of the DMV area (DC, Maryland, Virginia). We have a client who we need to send a proposal out to for the design of a custom home. The lot actually supports 3 homes and they would hire us for all 3, however they want to design just one floor plan and use the same thing on all 3 lots. The only difference would be some material change on the front elevations.
Another thing, they dont want some super custom home design, since they will be selling the properties. They want to use a sort of "generic" floor plan (I think so they can try to reduce the cost of design as well). We have some floor plans we can base a house design on but of course it still requires a similar amount of work.
How should we price this design out? I am thinking to break it down into the initial design of the home. Then an additional price per home and price for permitting (we will submit to county as well). I know its usually % of construction based but I am struggling to find a good fee to present them. Each home will cost approximately $1 million to build and theyll sell them for 1.6-1.7m.
Any thoughts?
I don't do SFR so my advice may not be the most appropriate. I know there are several users where who do SFR so they will be of more help with this.
I have done commercial jobs like this - several core and shell budlings that were very similar on the same site. While we did not charge a full fee for each building we did not give a steep fee reduction. I believe it was only a 20% reduction for the similar buildings. IE $120k for the first house, $96k for each additional house. Don't use these numbers though - it's just a 12% of construction fee.
One more thing - your client is asking for three custom homes. I don't care if they are a 'generic' floor plan. It's still custom work. Charge appropriately. You are providing value to the projects. If the client balks at this I would seriously consider not taking the work.
I have to agree with the last statement above. Without knowing a lot of context, each of these homes, even if identical in plan and scope are still subject to unique conditions such as underground utilities, vegetation, topography, privacy and most importantly light and shade.
These are all things I'm sure you think about, but (assuming these are three homes in a row) what conditions does the middle one have? When it hits the market, does it need to be priced $100k less than the two outer ones because it receives less light or has less privacy? I always feel like a middle unit has a bit less curb appeal as well.
I've seen builders and developers have this approach and in a tight sellers market it can work, but once a bit of inventory is sitting, the units with awkward floor plans and poor sightlines are a lot harder to unload for the seller. I've tried to have discussions with some builders about a space that's easier to sell and was once told "I'm an investor, I know that more bedrooms is better" without much regard to their size nor usability.
I think it could be entirely possible to create three identical houses that perfectly fit with each other, but there would need to be so much attention to massing and proper siting. This isn't the workload of one house being repeated 3 times, in fact I would argue it's significantly more.
Here's a good (or terrible) example of why you don't repeat four designs on one property. Years ago I looked at a neighboring property but was interested in following this one. The floor plans are awful, the houses have no privacy from each other, and there are so many missed opportunities.
https://www.youtube.com/watch?...
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