General information only. This article is educational and is not legal, tax, financial, lending or investment advice. Do your own due diligence and confirm everything with your own qualified professionals before relying on it. Read the full disclaimer.
An SB 684 project lives or dies on what its finished homes sell for. Every number upstream, from the land price to the construction loan, rests on that estimate. Here is how new fee-simple small-lot homes are typically priced, and what moves the price up or down.
Start With the Comparable Sales
Appraisers and buyers anchor on recent sales of similar homes nearby: size, bedroom count, age, condition and location. For a new small-lot home, the most useful comparables are other new or recently built townhomes and small-lot homes, and newer condos, adjusted for the advantages of owning the land. Price per square foot is the common shorthand, but it is a starting point, not an answer.
What Moves the Price
| Factor | Why it matters |
|---|---|
| Fee-simple title | Buyer owns the land and can use a conventional mortgage; no condo HOA |
| Neighborhood | Schools, walkability and the surrounding price level set the ceiling |
| Size and layout | Two- and three-bedroom plans with usable living space sell to the widest pool |
| Parking | A dedicated space is a major selling point on the Westside |
| Outdoor space | Rooftop decks and private yards add real value in dense neighborhoods |
| Finish level | Quality finishes support pricing; over-building rarely pays back |
| Position on the site | Street-facing and corner homes often price differently from interior ones |
Fee Simple vs. Condo vs. TIC
The same building sold three ways would price three ways. A fee-simple home on its own parcel generally sells at a premium to a comparable condo, and a condo generally sells above a comparable tenancy-in-common unit, mostly because of financing: the easier it is for a buyer to get a conventional mortgage, the deeper the buyer pool. That is why, where a site qualifies, we choose the fee-simple path.
Selling Home by Home
Small-lot homes are usually sold one at a time as they are completed, which lets pricing respond to the market as the project sells. The construction loan is typically repaid home by home, with each closing releasing a lot. See how SB 684 construction financing works.
The Honest Caveat
Projected prices are estimates. Markets move between acquisition and sale, and a project that pencils at today’s prices can be tested by a slower market. Disciplined underwriting tests the plan against lower prices and longer sale periods, not just the base case.
Frequently Asked Questions
Why do fee-simple homes sell for more than comparable condos?
Buyers own the land under the home, can use conventional financing, and usually avoid HOA dues and shared-building decisions. Those advantages tend to support a premium over condos of similar size.
What size are SB 684 homes?
The law caps the average at 1,750 net habitable square feet. Many Westside projects build two- and three-bedroom homes of roughly 1,100 to 1,600 square feet.
Who buys small-lot homes?
Mostly owner-occupants: first-time buyers, couples and small families who want a new house rather than a condo, in a neighborhood they might otherwise be priced out of.
Are small-lot home prices guaranteed?
No. Prices depend on the market at the time of sale, and finished homes can sell for less or take longer to sell than projected.
Important Disclaimer
This article is published by Assemble Capital for general informational and educational purposes only. It is not legal, tax, accounting, lending, appraisal, real estate brokerage or investment advice, and it is not an offer to sell or a solicitation of an offer to buy any security. Laws, regulations, government programs, lending practices, market conditions and local procedures change often and vary by jurisdiction and by property. The information here may be incomplete, out of date or not applicable to your situation, and we have no obligation to update it.
No one, including investors, lenders, property owners, buyers, sellers, agents, brokers, wholesalers or developers, should rely on this article in making any decision. Before acting on any topic discussed here, independently verify the information and conduct your own due diligence with qualified legal, tax, financial, lending, appraisal and real estate professionals and the applicable government agencies.
References to projects, timelines, approvals, appraisals, financing, prices or market conditions are illustrative, may change, and are not predictions, promises or guarantees of any result. Past performance is not indicative of future results.
Reading this article or contacting us does not create an attorney-client, advisory, fiduciary, agency, brokerage or other relationship with Assemble Capital, its affiliates or its principals. Assemble Capital makes no representation or warranty, express or implied, as to the accuracy, completeness or timeliness of this content and, to the fullest extent permitted by law, disclaims all liability for any loss or damage arising from any reliance on it. Use of this site is subject to our Terms of Service and Risks & Disclosures.
Related Reading
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Or see how this plays out in practice: SB 684/1123 Fee Simple Subdivisions.
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