So . . . you’re thinking about building that custom home you’ve always dreamed of!
You’ve found that perfect ocean view lot in Swampy Meadows Estates and you want your long-lost brother-in-law Herman, the building contractor, to build your home.
Unfortunately, that may not work in the Boise real estate market.
First, some developers are also home builders (think Corey Barton, Coleman Homes, etc.) who build homes on the lots they develop.
They, obviously, are not going to allow you to bring your own builder into one of their developments.
Another reason is “builder teams”.
Developers often select specific builders to build the homes in their subdivisions.
They call them builder teams and the builders selected as team members are the only builders allowed to buy lots in their subdivision.
Here’s how it works:
- The developer lists the lots in his subdivision with a real estate company.
- The developer selects builders for his builder team.
- The lots can only be purchased by members of the builder team.
- The consumer must use one of the builders on the builder team.
- The builder contracts with the consumer, then buys the lot, using funds from the construction loan that’s obtained by the builder.
Builder teams allow the developer to ensure that the homes built in the development will fit into the overall concept of the development.
The downside, for the consumer, is limited choice when selecting a builder.
I have long questioned the legality of this practice, but it seems to be ingrained in the Boise real estate market.
January 28th, 2014 Posted in Inside Real Estate | Print This Post
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