| Line | Amount |
|---|---|
| Gross revenue — 2 homes × 1,700 SF × $250/SF (Wake Forest new construction, downtown) | $850,000 |
| Land acquisition + closing (~2% of $150k) | ($153,000) |
| Construction — builder cost (3,400 SF × $111/SF builder grade) | ($377,400) |
| Home On builder margin (20% intro rate; standard 30%) | ($94,350) |
| Site development / 2-lot utility connections (incl. 20% margin) | ($75,000) |
| Contingency (10% of construction, AT COST — typically returned if unused) | ($37,740) |
| Soft costs — design/permits (5% of construction, at cost) | ($18,870) |
| Construction loan closing + carry (1.5% closing + 10% APR on $567k, 8 months) | ($27,418) |
| Selling costs (~7%) — paid at sale closing, not out-of-pocket | ($59,500) |
| NET PROFIT TO INVESTOR | ~$6,722 · 1% margin · 3% cash-on-cash (at $250/SF); needs $320/SF for 20% margin |
ARV comps: Wake Forest new construction active listing average $243/SF (Redfin June 2026); median sold $189/SF; premium new builds near downtown push $260–280/SF. At $243/SF: -$15,412 (negative); at $250/SF: +$6,722 (modeled); at $280/SF: +$69k (8%); at $320/SF: +$228k (21%). MAO $150k at $320/SF premium execution — at typical market rate ($243–$260/SF), current ask is already at or above MAO.
Hard math at standard Wake Forest prices. At $243/SF (active listing average), this deal loses money; needs $320/SF premium custom construction to hit 20% margin. Best case is an owner-builder who wants a Joyner Park / downtown Wake Forest address and can build at Home On's $139/SF builder-grade cost — they'll live in a home that cost $230/SF all-in while comparable new homes ask $243–260/SF. That's solid equity from day one. Pure investors should wait unless GR5 allows duplexes (call Wake Forest Planning first). If price drops to $120k, deal becomes interesting at $260/SF.