I want to build a simple, functional, house.?

I dont care if it looks like a barn or box. has a basement, or is a 2 story above. how do I go about starting a business plan. Im confident that a well designed house (mabey even triplex) built to be rented out (except for one where ill live) will be an excellent investment for years to come. I can rent and throw away aftertax dollars, or put in overtime and start wealth building? please share thoughts/experiences

easy quick judge. I want a simple plain cost effective outside. theinside will be open concept with quality flooring and interior.

I can't really help you with a business plan, but if you visit this home plan website you might find some helpful info in the resource section. They have articles about the benefits of building a one or two story house, money saving tips, things to consider before you build, etc.

They also have all kinds of great house plans if you don't have one already...they even have duplexes and triplexes. You might see something you like.

Home page:
http://www.thehouseplanshop.com/

Resources:
http://www.thehouseplanshop.com/resource...

If you do not care what it looks like, you will get the kind of tenants that do not care either. They also may not care whether they pay the rent on time or at all. Learn something about the business before you leap.

First, a note of warning, since you are looking to write a business plan I assume you are looking for money to at least partially pay for the structure you're putting up, in this case most lenders (if you can find an individual that lends money, much easier to work with, usually) look at your personal credit history, they couldn't care less about the business plan unless your credit history checks out. (Most lenders are too averse to risk to actually lend money on a concept -- personal experience, multiple times)

With that out of the way, I have found the best places to go for business plans are http://www.sba.gov and the local library (a good book is much better than a web site, especially on a project as complex as a business plan).

Several factors you will need to research are: occupancy rates in your area (a local Realtor, preferably a nationwide network like Coldwell Banker can provide some of this information); rent offerings for available locations (a little extra square footage is not that expensive to build, but the payoff can be large); and likely locations for your building (remember to take into account: zoning, access to utilities, etc.).

With all of your information you need to put it together and see if it actually works on paper.


IMPORTANT !!! FOR THE PURPOSE OF INVESTING NO INCLUSION OF INCREASED VALUE IS ENTERED INTO THE EQUATION, USING FUTURE VALUE IN YOUR NUMBERS IS SPECULATING, NOT INVESTING!!!


Return on Investment is the number that will tell you whether the investment is worth it or not. If the ROI is lower than another investment that you can make that has similar risk, the investment is not worth the risk.

For our exercise we will assume that your monthly rent from the two units will be $2,000.00 per month which equals $24,000 annually. But the occupancy rate is only 85%, which means that the expected revenue per year is only $20,400.00 (Full rent X occupancy rate). Furthermore your mortgage payments are $900.00 per month, or $10,800 annually. Your maintenance estimates are $500 annually. Therefore, total expected revenue per year is $9,100.00. You originally invested $50,000.00 in cash and borrowed the remainder for the project. $9,100.00 divided by your initial investment of $50,000.00 equals 18.2%, a very good investment for very little risk. Your ROI is 18.2%, as long as no investments with similar or less risks exist at a greater rate of return this is a good investment.

For the above I randomly chose numbers and they will depend upon your individual project, but I hope I provided you with what you required.

Dont forget to look into permits. You will find that permits/taxes to build a house costs 10s of thousands of dollars up front.

I actually found a piece of land in marin county near San Francisco. The land was only 15,000 dollars and i thought i could put a house there. Turns out the permits alone would've cost 300,000 dollars!!! (Super old houses in marin co and the cheapest run 500,000 dollars so i guess thats how they keep those prices inflated)

Another part of CA that was in the back woods somewhere cost 30,000 for the permits! So check those first!

look on web for u-build-it house sites.visit library do ur homework or lose money.
save up lots of cash now.
vist daveramsey.com to learn ur hard lessons from others mistakes.

1st and foremost: You MUST find land suitably zoned to build your triplex. Your best solution is to go to the municipal building where you would like to have your building and ask about zoning for your building. You may even be able to build a 4 unit building.

Anything over 4 units requires different financing.

2nd. Have the utilities separate with separate meters. You want separate water, electric and heating. On a cold winter evening, you DO NOT want to come home from visiting family, friends or being away for a weekend, to see windows open all over the building - simply because you decided to pay for the heat. The same for water and electric. Tenants have a tendency to take advantage of those services paid for by their Landlord or imcluded in the rent.

3rd. You want the propertyt to be as energy efficient and maintenance-free as possible. Appearance is one thing - maintenance is quite another.

Use THE BEST materials you can afford. Consult an architect or very good general contractor THEN make the investment in a building-design or home-design computer program.

4th. If you don't know how to properly screen and select tenants, THE VERY BEST suggestion is to hire a professional real estate management company to do the job for you.

TRUST ME: As soon as tenants or applicants discover you are the owner/Landlord, you'll be bothered night and day with phone calls and problems.

I could have ventured into the mathmatics and other real estate lingo, but I think I gave you a very, very basic start.

Thanks for asking! I enjoyeed answering your Q!

VTY,
Ron