| Line | Amount |
|---|---|
| Gross revenue — 8 lots × 2,800 SF × $280/SF (estimated; see ARV note) | $6,272,000 |
| Land acquisition + closing (~2%) — 14.29 ac | ($637,500) |
| Construction — builder cost (22,400 SF × $111 builder grade) | ($2,486,400) |
| Home On builder margin (20% intro rate; standard 30%) | ($621,600) |
| Site development — 8× well + engineered septic (incl. 20% margin) | ($630,000) |
| Subdivision infrastructure — 7 new lots (incl. 20% margin) | ($306,250) |
| Soft costs — design/permits/survey (5% of builder cost, AT COST) | ($124,320) |
| Contingency (10% of builder cost, AT COST — typically returned if unused) | ($248,640) |
| Construction loan closing + carry (10% APR on draws, ~20 months) | ($372,784) |
| Selling costs (~7%) — paid at sale closing, not out-of-pocket | ($439,040) |
| NET PROFIT TO INVESTOR | ~$405,466 · 6.5% margin · 24.4% cash-on-cash — PASS |
ARV — Wake Forest new construction market avg $243/SF; no confirmed comps at $280/SF for rural well/septic homes near this site. Listing notes neighbors with $1M+ homes to the rear, suggesting some premium potential. At $330/SF (comparable to Hillsborough premium market — unconfirmed here), the deal shows ~19.6% margin and MAO jumps to ~$786k vs $625k ask. Without firm comps above $280/SF for Wake County rural product, PASS.
PASS — at $280/SF (current Wake Forest rural market), the deal returns only 6.5% investor margin; well/septic site costs ($630k for 8 lots) eliminate the value that a public-sewer project would preserve. At $330/SF (unconfirmed; needs specific sold comps for rural Wake County acreage homes), the model yields ~19.6% margin and the $625k ask is actually well below the ~$786k MAO — the "pass" could flip if a buyer confirms premium comps. With 169 DOM the seller may be motivated; any offer should be contingent on perc tests and utility confirmation. Re-evaluate if public sewer extension is announced for this corridor.