Should you Tear-Down and Rebuild?
Recently I dealt with a sale that could have been a tear-down. The house itself was very dated with a poor layout. All four basement walls were bad. Two walls required beaming, the third wall had to be completely dug out and straightened, and a pair of engineers disagreed whether the fourth wall had to be dug out or only beamed. Still, the neighborhood around the property was excellent and the house was on an oversize lot with mature trees.
Buying to tear down and rebuild is uncommon in southeastern Wisconsin. It most often occurs with lake homes. Vacant lake lots are rare and new building restrictions may only allow for additions to existing homes. (This is where stories of “one wall left standing” come from.) Off the water, only a few very desirable communities with little to no available land merit the expense of tearing down to rebuild. Elm Grove is a prime example. The Bay View neighborhood in Milwaukee sees it most often at a commercial level, but residential tear-downs happen occasionally. Tear-downs also occur in and around the Lake Geneva area.
Here are five things to keep in mind if you are considering tearing down to rebuild:
1. Does the existing property have a historic designation? If so, it may not be possible to alter that property at all.
2. Is the lot buildable? Tearing down may be legal while building new is illegal. You may be forced to leave one wall of the old house standing and use that wall in the new build.
3. Where may a new home be located on the lot? The existing house could be grandfathered in its present location. New construction may not be grandfathered.
4. May the lot be subdivided? If you do not want to tend to an estate, perhaps you can sell other parcels to recoup part or all of your investment. Done right, you may even turn a profit!
5. What is the situation with utilities? Will you be forced to dig a new well and install a septic? Or, more frequently, will you be forced to hook up to existing municipal water and sewer? If so, what impact fees should you expect and how much will it cost to cap the well and remove the septic system?
Thinking of tearing down to rebuild? If so, your needs and wants will be different than what the average buyer seeks. Please let me know what you want in a lot, and I will help you find exactly what you need…
…even if an old house is there right now!