RMB48 said:
With margins in my area being so low due to competing with the DR Hortons and such of the world, giving 5% away... yikes.
Good luck competing with them on anything related to price. I say, don't even try to compete with them. Build a cooler house than they do, on better property. Anything you can't see when the house is done is no frills (frame/HVAC/insulation/etc). Put your money into finish out. Market to people who don't want a cookie cutter house on a postage stamp lot. At least, that's worked pretty well for me.
And yes, 5% sucks if you're just looking at 5% of whatever. (If you're doing $500k or more houses, then forget everything I'm saying. I'm assuming you're talking $150-250k for some reason, but I don't know your location and market) But, if you figure interest per month on your money, and a realtor can sell it 2-3 months quicker than you can, then that offsets some of her fee. Plus, how much is your time worth? How much time will you have to spend taking pictures, posting the listing on the MLS and wherever, showing the house, etc?
What price range houses you talking here? Starter houses? Luxury homes? How many a year?