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New Construction Works for Renters… and Real Estate Investors

When you’re looking to invest in a rental property, don’t overlook new construction.

New Construction for Renters

Considering new construction as a potential investment rental property? Here are a few points to ponder:

Like a shiny new penny, all of the appliances sparkle in a just-built home. The walls lack nail holes and the hardwood floors are scratch-free. The bathroom grout is clean and the home interior smells fresh, offering no indication about a previous inhabitant’s penchant for cigars or furry roommates.

As Mike Kalis, CEO at MarketplaceHomes describes in an article for Retipster, “You can choose your location, you can customize the amenities, and, best of all, everything is new. For real estate investors, that peace of mind is priceless.”

But beyond the sprouting baby grass and untouched surfaces, another favorable reason to go with new construction is the potential for increased ROI.

Simply put, investing in new construction makes good business sense. You’ll save on closing costs and renovation costs, as there’s no need to spend money bringing the dwelling up to code.New Construction HomeUnion Examples

You’ll also hit the ground running—all the way to the bank. Newly constructed homes typically appeal to renters and rent quickly, which translates into cash flow, asap. In an article for BiggerPockets, Joshua Keen notes, “Many renters are willing to pay more for brand-spanking-new properties, especially when they come with higher-end modern amenities. This results in a steadier cash flow, lower vacancy rate and often a higher resale value when you finally decide to let the property go. All of which equal more money in the bank for you.”

Builder and manufacturers warranties can also help boost your ROI—and you won’t have to worry about the furnace breaking down during the first cold snap, or the roof shingles peeling off with a strong gust of wind.

Benefits of New Construction

  1. Builder Warranties
  2. Manufacturers Warranties
  3. Energy Efficient – This means lower utility bills and another benefit for renters
  4. Built to today’s building code standards for electricity & plumbing
  5. Move-in ready for tenants (usually only lacks blinds and refrigerator)
  6. More attractive to potential tenants
  7. Tenants tend to stay longer
  8. Rent premiums for New Construction
  9. Traditionally, more attractive to buyers if you decide to sell in the future
  10. More modern, open floor plans that are suited for today’s lifestyle

 

HomeUnion Can Help You Get Started—and Help You Flourish

When you need an expert perspective on finding the new construction property that best meets your financial goals, HomeUnion is here. Throughout your real estate investing journey, our Solutions Managers will listen to your concerns, answer your questions and offer you smart solutions. At every step of the way, from property acquisition to ongoing property management, you can rely on us to help you flourish.

4 Comments

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Tbomas trinkle May 22 2017 - 11:41 AM
Do you put up money for financing?
    Alisha Chocha May 22 2017 - 2:18 PM
    Hi Thomas, Good question. Yes, the investor puts up money for financing the investment. Your Solutions Manager will reach out to you shortly to answer any further questions you may have. Thank you, Alisha at HomeUnion
Josh Greenwald May 23 2017 - 8:54 AM
Which markets works best for build to rent projects? Please have solutions manager reach out to me, thanks
    Alisha Chocha May 24 2017 - 9:40 AM
    Hi Josh, Will do! We look forward to speaking to you. Thanks, Alisha at HomeUnion

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