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Leron's Forum Posts: 2

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By Leron in Oakland, CA on 1/26/2007


Hi all.  Oakland, CA (San Francisco area)

I just purchased my first piece of real estate with a duplex on it. The lot is zoned for a triplex, so I'm renovating the duplex and building an additional single unit in the back, filling out the three units allowable by zoning code.

Since this is my first real estate purchase and I have no construction experience; and since I will be selling two of the three units as condos, I thought that I should use a contractor so as not to be held personally liable by the future owners for the quality of my construction as an owner-builder. So I called around to a few GCs. Ballpark prices over the phone ranged from $250-$350/square foot (construction only: labor + materials). Then I called another guy and he told me he could do the job for about $150 per square foot. I met him at the site and, with just a simple description of the house (no plans yet), he confirmed a price of $140-$150/sq ft.  This price does not include misc fees, permits, or site work.

I met two of his clients and they seemed happy with his work. I checked his GC license and he has no complaints with 11 years as a GC. He's registered as having no employees.

Questions:
1)  Is this price even possible in the San Francisco area, or will I find myself way over budget? He seems trustworthy, but...?

2)  The third house unit is behind the main duplex at the back of the lot. Water and sewer lateral lines will need to travel about 125 feet from the front line of the property. The ground is currently all concrete. He told me that the total cost for excavation, pipes, hookup, backfill, street repair, etc could be  an additional $30,000 to $50,000. This seems WAY excessive to me. Is this excessive for water/sewer line construction?

3) Any other comments would be welcome.

Thanks,

Leron
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By Dale in Richland, AZ on 3/4/2007


Sewer can be very expensive to run and he may be trying to make more of his profit on that part of the job because the rest of his pricing seems VERY reasonable.

I would call downtown and find out what sewer hookup fees are. Then call a couple of plumbers and have them bid that part only. Also depth of sewer and how much it is above or below your furthest fixture will factor into the pricing. You need a 2% slope to your line. Something else, whoever does this has to figure on ripping up all that concrete, getting a machine in there to dig, dealing with traffic and sidewalk blockage, and hauling all the debris to the landfill.

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By Netie in Salt Lake City, UT on 3/8/2007


I agree with Dale - utility work can be a killer! I've seen real estate deals fall apart when the folks finally realized the cost of bringing in and hooking up the systems. There's another poster on here from Las Vegas who spent a grundle too - do a search - I think it was over $60K! 

At this time you're in the first stage of dream/panic (been there/still there) - don't let it scare you off - you're doing the right thing by researching and talking to folks *BUT* w/o a floor plan to submit to a GC for  bids (which normally expire in 30-60 days anyway) you're going to be hard pressed to get any real numbers and then you may seriously run yourself ragged in theoretical circles!

Anyway, $150/sq ft is super cheap for SF - if you go with him - I'd make sure to include a mandatory furnishing of a Surety (performance) bond to ~80% of the total cost of the contract. 

Good luck with the project!


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