Savannah Ga Homes -- Re-Building

Home renovation in Savannah Ga, in my opinion, will continue to be a huge concern. It is true that there is room for development west of Savannah in Effingham County and south of Savannah in Bryan county, but here I am talking about buyers who want to live in Savannah.

Savannah is locked to the east by the ocean, the north by the Savannah River, and south, to an extent, by marshlands. West Chatham still has room for new development, but a lot of that will be commercial and industrial.

So it will leave those who want to be close to downtown Savannah, midtown Savannah, southside Savannah and the Savannah islands, as the few remaining areas for development are taken, with the choice of condo conversions or renovation of older homes.

I am in the process of renovating several older homes and personally I find it a challenging and rewarding activity. Whether it is profitable or not, we will see. But I am not talking so much about the investment angle as I am about re-building rather than building new construction.

The outcomes can be similar as far as quality of construction, and costs can be comparable. But a lot of homework needs to be done before renovating an older home. Controlling re-building costs is critical. There are many quality re-builders in Savannah, but because it can cost more sometimes to re-build than to build from scratch, it pays to know what the costs are going to be. It pays to know as much as possible about what all needs to be re-built, how much you will have to contract out and how much you can do yourself, and the current cost of materials.

I foresee the need for buyers to pay contractors for estimates before signing a contract. In a week or two a buyer should be able to determine how much it will cost to re-build. This process will add to the decision time to buy, but it will be time well spent. Now, most buyers get a thorough home inspection after a contract is signed, but the inspectors don’t give estimates of re-building costs, at least the ones I deal with don’t.

The time seems ripe in Savannah for a combination cost-estimate on re-building and home-inspection, either done before signing a contract or after signing a contract with a due-deligence period factored into the contract. This means that if a contract is signed, because the buyer wants to make sure that they have the first choice of buying, it is stipulated in the contract that a period of time is requested to inspect and get estimates of re-building, and that if the findings make it not feasible to follow through the deal is off and all earnest money is refunded. We have this stipulation in our contract now in Georgia, but it usually weakens the offer because the seller doesn’t want to take the house off the market without a stronger contract.

However, I think this stipulation will be used, or should be used, more often in the future by savvy buyers, so sellers may have to get comfortable with it. When you consider the high cost of a bad, uninformed decision based on the desire to renovate unexamined by a professional re-builder, it only makes sense to spend the extra time and money to get a true estimate of costs.

Hopefully, we will see re-builders offering a combination cost-estimate and home-inspection service. The only problem would be a conflict of interest possibility and liability risk, but I think it can be worked out by honest professionals as long as it is made clear that the buyer can choose whichever re-builder they want to do the work. Re-builders will not want to lose business due to high estimates when there is plenty of competition. Also, if you are working with a buyer real estate agent who is representing your interest, this agent should be able to give good references.

Comments

[Radley]

Hi Mike,

Great work again Mike. How awesome is Savannah weather right now?

Radley

[Mike]

Thanks, Radley. It is in the nineties and shinin'.

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