[Hal Cranmer]

Hal Cranmer

I am in the midst of working with a builder to construct a house in a suburb of Minneapolis. We are almost done with the build, and it should be ready to sell this month. We would like to use it as a model home to hopefully convince other people to find a lot and commission my builder to build another house for them. Regardless of what happens, after about a month or two we would put this house on the market and just sell it outright.

My question is, could a model home be used in some form of HBS to sell the model home but at the same time convince some portion of bidders to contract with us to build them a home on a different lot? I’m thinking all the people who lose out on buying the house might be prime candidates, but having never done an HBS I don’t know if it would work?

Thanks

[Jackie Lange]

Jackie Lange

Yes it could work but … usually with a HBS your starting bid is about 30-40% below market. If the builder willing to do that? If you don’t start the bidding below market, you will not get enough people there to big the price up up up. And potentially buy other lots to build other houses.

[Hal Cranmer]

Hal Cranmer

My builder and I have worked together on this project – I provided the financing and he did the building. I would think I could explain to him that if we didn’t get the price we wanted for it, we could just list it with an agent. The big thing I wanted to know is if it would be worth it. I think we could sell it with an agent pretty quickly, but we would not sell it for a month or two and use it as a model while we tried to attract buyers for other lots. With the HBS we could both sell the house quickly and potentially find some other buyers as well. Make sense?