Hi Danny! Would you consider building up to 4 units in Riverside instead?
Hi Danny, I work with a few different lenders who do land+ground up construction financing. Dm if you have any questions, thanks!
@Danny Garcia building will take a long time, quite a bit of upfront capital, and someone who knows zoning very well. Do you have previous experience with either rentals or construction?
@Danny Garcia if you have not done this before it is likely going to be more expensive to build than it would be to buy especially when you factor in financing which you will have to use during construction while collecting zero rent.
Originally posted by @Danny Garcia :
@Aaron Klatt I have no experience but I feel like prices are really high to purchase rental properties which is why I am trying to look for other options
Building will NOT be cheaper than buying in todays market. Period. Not saying you can't make money just that its not cheaper, especially not enough to be worth it for someone that has zero experience. The up front costs are HUGE in comparison to just a down payment. Banks will still only lend on 80% of construction costs, sometimes less. So you still will need that 20% cash. Then you have permit fees and other professional fees on top of that. Permit fees alone could be several thousands of dollars if not into the tens of thousands. Then you get to pay for architecture/structural/civil drawings. Geotech reports and traffic studies. And the list goes on. This varies state by state and city by city of course. I highly advise NOT to do new build construction on your own with no experience. At least get a partner who has experience. this is not like going to a home builder and building your personal dream home.