| Line | Amount |
|---|---|
| Gross revenue — 2,600 SF × $280/SF (Wake Forest new const. median ~$284/SF) | $728,000 |
| Land acquisition + closing (~2%) | ($122,400) |
| Construction — builder cost (2,600 SF × $111 builder grade) | ($288,600) |
| Home On builder margin (20% intro rate; standard 30%) | ($72,150) |
| Site development / infrastructure, public utilities (incl. 20% margin) | ($37,500) |
| Soft costs (5% of const., at cost) + contingency (10% of const.+site, AT COST — typically returned if unused) | ($46,290) |
| Construction loan closing + carry (10% APR on draws, 9-month build) | ($22,323) |
| Selling costs (~7%) — paid at sale closing, not out-of-pocket | ($50,960) |
| NET PROFIT TO INVESTOR | ~$87,777 · 12.1% margin · 52.7% cash-on-cash |
ARV support: Wake Forest new construction median list price $709K (RaleighRealty 2026, 217 homes); at 2,500 SF avg = ~$284/SF. Using $280/SF conservative for 2,600 SF = $728K. Kinsley by McKinley Homes (nearby, city water+sewer) townhomes from $315K–$434K ($209/SF). MAO for 20% investor margin = $63,310 vs. $120K list — deal needs a big discount for investor 20%. At $80K purchase, investor nets ~$116K (16% margin). Best use case: build-own at ~$167K out-of-pocket for a custom 2,600 SF home near downtown Wake Forest.
Best positioned as a build-own lead, not an investor flip. At $120K ask, the investor nets 12.1% ($87,777) — below our 20% bar. MAO for 20% margin is ~$63K; at $80K offer (plausible after 270 DOM) investor nets ~16%. For a build-own buyer: spend $167K out-of-pocket, get a brand-new 2,600 SF custom home in downtown Wake Forest with city sewer — saving $150K+ vs. buying finished new construction at comparable size. Offer $70K–$85K and reference the 270-day DOM in negotiations.