[quote=sdrealtor]This aint Atlanta. Good rule of thumb: 1/3rd for land, 1/3rd for construction and 1/3rd for margin.[/quote]
I don’t think even Atlanta is that low any more. However I was a Controller for a large homebuilder and the conventional wisdom at the time which was in the early 80’s that you couldn’t make money if lot cost was > 25%
However that was back when they wanted lower ratio’s, down payments. Back then our mortgage company would call the buyers employer to make sure they were still working there on the day of closing (g).
The relationship got out of wack when the underwriting standards were revamped along with the bubble in raw land prices.
