First time with new construction: Cape Coral, FL

Cape Coral, Florida
Land & New Construction
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First time with new construction: Cape Coral, FL

Don M.
Member since 2021 · 135 posts · 203 votes

Hey guys,
This post is mainly just to share where I'm at with this process, provide opportunities for myself to network with others in the area, and so I can periodically update.  I have connected with several members doing new construction or with boots on the ground in Cape Coral, so thanks to all of you that have discussed and answered questions from me so far.
Here's where I'm at:
-Connected with Rent to Retirement in November/December 2021 to discuss the area and opportunity.
-Closed on build contract January 2022 on a 4/3 (Build price itself is 246k).
-Closed on Freshwater canal Lot February 2022. (39k with closing costs).
-(All in construction+lot cost is 285k before loan and closing costs).
-Sent Deposit to builder February 2022. (13.5k) 
-Surveys, Site Plan, Septic Design approval initiated: February 2022
-Completed Survey/Design Package completed and sent to city of Cape Coral: June 2022
-As of August 2022, Permits are still under review by city.  Most submissions are under "Approved" status, but permit not formally issued.
-Lender currently has an estimated valuation of 410k for the property.


The hope is to buy and hold, LTR.  Current projected rent: ~$2450/mo

Needless to say, it has been a very interesting time to build.  We are excited, at times frustrated, and have a healthy level of anxiety, but all of those elements were expected from the start.

I'll try to keep this thread updated, as it has always been helpful for me to read others' experiences.

-Don

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Zach LemasterBusiness Member
Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
4y

@Don M.

Thanks for sharing the details of your project!  Please keep us all updated with progress.  All normal emotions for going through the tedious construction process.  I'm right there with you.  Hopefully things continue to progress, and you come out on top with a huge equity position/high cash flow when it's all completed.  We are seeing about 50/50 split of people holding as rentals vs selling.  The avg equity position upon completion is about $150K with avg rent of $2,500 leasing in 3 weeks or less post CO.  Hopefully this gives you some light at the end of the tunnel.  Feel free to reach out at any point with any questions, or just to get a sense of how the market is doing overall.

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  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
    4y

    @Don M.

    Thanks for sharing the details of your project!  Please keep us all updated with progress.  All normal emotions for going through the tedious construction process.  I'm right there with you.  Hopefully things continue to progress, and you come out on top with a huge equity position/high cash flow when it's all completed.  We are seeing about 50/50 split of people holding as rentals vs selling.  The avg equity position upon completion is about $150K with avg rent of $2,500 leasing in 3 weeks or less post CO.  Hopefully this gives you some light at the end of the tunnel.  Feel free to reach out at any point with any questions, or just to get a sense of how the market is doing overall.

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5334 Reviews
    WebsiteView Page
    15Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y
    Quote from @Zach Lemaster:

    @Don M.

    Thanks for sharing the details of your project!  Please keep us all updated with progress.  All normal emotions for going through the tedious construction process.  I'm right there with you.  Hopefully things continue to progress, and you come out on top with a huge equity position/high cash flow when it's all completed.  We are seeing about 50/50 split of people holding as rentals vs selling.  The avg equity position upon completion is about $150K with avg rent of $2,500 leasing in 3 weeks or less post CO.  Hopefully this gives you some light at the end of the tunnel.  Feel free to reach out at any point with any questions, or just to get a sense of how the market is doing overall.

     Thanks Zach, I totally agree.
    Here are some things that keep me extremely optimistic about the build, when I have moments of frustration:
    -My initial expectation of value was ~340k.  We have far surpassed that number.
    -Despite delays, we are locked in on our build price, allowing us to take advantage of significant appreciation over the last 7 months.
    -My initial expectation of rent was ~2100/mo.  We have far surpassed that number.
    -If we saw a significant market correction in the area of 15% or more from peak (which I don't anticipate in this price range) our equity position is strong enough to weather that storm.
    -I learn more about Cape Coral every day.  The business development is booming as much as housing in the area.
    -Cape Coral is making an effort to bring on new employees and free up employees to improve permit processing times.  I am hopeful this in conjunction with slightly less new starts on construction will help improve permit timing and material delays.

    I think it is also noteworthy that R2R has been as transparent as possible, reflecting timelines as accurately as possible.  While timelines are now longer than the initial expectation, R2R has been updating this information as soon as new timelines become evident.  
    @Zach Lemaster, I will definitely be in touch as the traction continues and we have decisions to make.

    Is this investment a disappointment, a base-hit, or a homerun?  It would be unfair to say on emotion or speculation until we are 100% done with the build and officially implement our strategy, but we are optimistic.

    6Reply
  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
    4y

    @Don M.

    Outstanding summary Sir!  I agree with everything you said 100% & I appreciate the positive feedback.  We still have some time in front of us until the build is completed of course, but I agree that you are in a good position.  Most importantly, I'm sure you would agree, this has been a huge learning experience that will allow you to be a more successful & savvy investor in the future based on this experience.  That is the true value of participating in things like this that are a bit more involved.  Most people have zero knowledge or experience when it comes to building.  This is a very valuable skillset to have in your arsenal as an investor that can dramatically increase your net worth in a short period of time if the strategy is applied correctly.  I do believe your land has gone up significantly in value as well correct?  Most decent lots are selling in the $50k to $60k range.  We now have some other locations in FL & other markets that have much quicker timelines for completion (~90 to 120 days) & still have some equity.  Please continue to keep us in the loop on progress updates from the city & builder so we can track with you.  Feel free to reach out at any point whenever you are ready to look your next investment, or to discuss this construction project. 

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5334 Reviews
    WebsiteView Page
    13Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y

    @Zach Lemaster I think that is a great point; we are getting a phenomenal education along the way, and it is a heck of a lot cheaper than college.  That is another intangible asset that we are inadvertently growing.
    From LLC formation, to working with builders, to understanding what the city is doing, to learning the multiple layers of lending, we have automatically built relationships and a foundation of knowledge that we wouldn't have gotten in the same way through other routes.
    We have definitely continued to see land appreciation, which is worth mentioning.  We are so excited to see this through that we generally don't give it too much thought, since we have our eyes on the big picture.
    We definitely have an affinity for Florida and plan to keep our eyes out with what R2R is doing once we see this through.

    Again, to others considering this, I can't give a definitive "Yes, this is an investment everyone should make."  As much as we've learned, we have a lot to continue to learn.  As with any investment, we're facing risk.  We have an added layer of stress compared to something turnkey in the traditional sense.  Sometimes we have uncertainty with things like the market trends and interest rates.  Some days it is hard to see that light at the end of the tunnel.  What I would be confident in saying is that R2R can be a great facilitator of opportunity, a great opportunity for making connections, and a great opportunity for learning.  At the end of the day, one should always do his/her due diligence, just like any investment.

    Thanks Zach for your input and the discussion.

    3Reply
  • Bernard Joseph S.
    Investor · NJ · Member since 2022 · 154 posts · 223 votes
    4y

    Great post @Don M. , we have spoken about this situation before and although frustrating the reward will be worth the wait. It is a unique investment though and I know RTR offers many other opportunities that move a lot quicker. My wife and I are exploring other options in the RTR turnkey inventory while we wait for out Cape Coral completion. There is also a nice 1031 we have upcoming that we might parlay into a few turnkeys if the #s work. But all the research we put into Cape Coral like you did, points to this being a great opportunity and I don't want to miss it. You're going to do very well at your entry point Don.

    I'll add this while I'm here, @Zach Lemaster has gone out of his way to make my wife and I feel very comfortable with our decision. I know I've driven that man crazy more then once lol but he offers solutions and options to make things right. For a CEO to care that much about individual customers means something. Customer service is everything for an old school guy like me. Cheers to that man.

    Cape Coral and all of SW Florida will be boom town for the foreseeable future I believe. Good luck to all of us

    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y

    Thanks @Bernard Joseph S.
    Connecting with other investors has definitely been helpful to me.  It reinforces the normalcy of some of the potential obstacles that come up.  Having that sounding board can help take some of the emotion out of the investment and gets me back to the big picture.
    I appreciate our conversations and look forward to continuing to discuss our progress (and potential setbacks) along the way.

    2Reply
  • Aj Parikh
    Rental Property Investor · Centreville, VA · Member since 2019 · 1k+ posts · 799 votes
    4y

    This is amazing!! Congratulations! Listen to @Ruchit Patel episode on Rent to Retirement podcast and it has been amazing to listen to the story. Your investing journey is similar to him and you guys can connect to share knowledge. I know he would be happy to connect 

    3Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y
    Quote from @Aj Parikh:

    This is amazing!! Congratulations! Listen to @Ruchit Patel episode on Rent to Retirement podcast and it has been amazing to listen to the story. Your investing journey is similar to him and you guys can connect to share knowledge. I know he would be happy to connect 


     Thanks!  I actually heard the episode, as well.  Always excited to hear about others on a similar path or with similar goals.

    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y

    Coincidental timing with the post, but a quick update:
    Our permit review status (for Residential Construction) was changed to Complete today, in Cape Coral's permit tracking system.



    Submittal Status:Approved  Received Date:07/15/2022  Due Date:08/26/2022  Completed Date:08/17/2022

    3Reply
  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
    4y

    @Don M. Congrats on the permit being approved!  Thanks for the update.

    @Bernard Joseph S. I appreciate the kind words!  We are always here to assist in answering as many questions as you have & to work through any issues that come up along the way.  That is our commitment to our investors.  We do our best to build long term relationships with clients.

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5334 Reviews
    WebsiteView Page
    11Reply
  • Zach LemasterBusiness Member
    Rental Property Investor · Denver, CO · Member since 2015 · 1k+ posts · 3k+ votes
    4y

    @Aj Parikh

    Thanks for sharing!

    [email protected]800-311-6781Podcast Guest on Show How to Get 10%+ Off Your Next Real Estate Deal Right Now
    Rent To Retirement5334 Reviews
    WebsiteView Page
    11Reply
  • Chris Harper
    Investor · Wilmington, MA · Member since 2020 · 10 posts · 16 votes
    4y
    Quote from @Don M.:

    Coincidental timing with the post, but a quick update:
    Our permit review status (for Residential Construction) was changed to Complete today, in Cape Coral's permit tracking system.



    Submittal Status:Approved  Received Date:07/15/2022  Due Date:08/26/2022  Completed Date:08/17/2022

    @Don M. congrats on getting out of permitting. I have one that just completed all the reviews successfully last week so hopefully I'll be in the same boat soon for that property.

    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y
    Quote from @Chris Harper:
    Quote from @Don M.:

    Coincidental timing with the post, but a quick update:
    Our permit review status (for Residential Construction) was changed to Complete today, in Cape Coral's permit tracking system.



    Submittal Status:Approved  Received Date:07/15/2022  Due Date:08/26/2022  Completed Date:08/17/2022

    @Don M. congrats on getting out of permitting. I have one that just completed all the reviews successfully last week so hopefully I'll be in the same boat soon for that property.

     Excellent, @Chris Harper.  Hopefully these keep moving through smoothly and your additional property will get through promptly as well.  Keep me updated!

    0Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y

    My thoughts go out to everyone affected by Hurricane Ian.  Of course, SWFL got a large brunt of it, and the islands look pretty devastated.  From media coverage and contributors on the forums, it looks like much of Cape Coral fared well (relatively speaking).  Obviously, the most important focus is on those who experienced loss of life, need rescue, and experienced total loss; again, my heart goes out to those people.

    From an investment standpoint, hurricanes are obviously a real, calculated risk of the area.  It will be interesting to see how the storm may affect build times, with so much need for labor, repairs, and construction in SWFL. At this point, I believe most of Cape Coral is without power still.  It will also be interesting to see how values could be affected down the road, as well.

    0Reply
  • Bernard Joseph S.
    Investor · NJ · Member since 2022 · 154 posts · 223 votes
    4y
    Quote from @Don M.:

    My thoughts go out to everyone affected by Hurricane Ian.  Of course, SWFL got a large brunt of it, and the islands look pretty devastated.  From media coverage and contributors on the forums, it looks like much of Cape Coral fared well (relatively speaking).  Obviously, the most important focus is on those who experienced loss of life, need rescue, and experienced total loss; again, my heart goes out to those people.

    From an investment standpoint, hurricanes are obviously a real, calculated risk of the area.  It will be interesting to see how the storm may affect build times, with so much need for labor, repairs, and construction in SWFL. At this point, I believe most of Cape Coral is without power still.  It will also be interesting to see how values could be affected down the road, as well. 

    I found this map that can zoom in to the aftermath. It’s amazing the difference in damage within a short distance. A lot of area looks barely touched and then of course you have devastation in Fort Meyers Beach. 

    https://storms.ngs.noaa.gov/st...

    My first concern is with the people who are suffering, but of course we have to think of our investments as well. This isn’t good for anyone and will take quite awhile to resolve. 

    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    4y
    Quote from @Bernard Joseph S.:
    Quote from @Don M.:

    My thoughts go out to everyone affected by Hurricane Ian.  Of course, SWFL got a large brunt of it, and the islands look pretty devastated.  From media coverage and contributors on the forums, it looks like much of Cape Coral fared well (relatively speaking).  Obviously, the most important focus is on those who experienced loss of life, need rescue, and experienced total loss; again, my heart goes out to those people.

    From an investment standpoint, hurricanes are obviously a real, calculated risk of the area.  It will be interesting to see how the storm may affect build times, with so much need for labor, repairs, and construction in SWFL. At this point, I believe most of Cape Coral is without power still.  It will also be interesting to see how values could be affected down the road, as well. 

    I found this map that can zoom in to the aftermath. It’s amazing the difference in damage within a short distance. A lot of area looks barely touched and then of course you have devastation in Fort Meyers Beach. 

    https://storms.ngs.noaa.gov/st...

    My first concern is with the people who are suffering, but of course we have to think of our investments as well. This isn’t good for anyone and will take quite awhile to resolve. 


     Thanks for the resource!  I'll definitely be searching through it.  I'm in a lot of Cape Coral Facebook groups, follow Cape Coral government and sheriff's pages, but this will be a helpful, objective resource.

    1Reply
  • Ashy Koshy
    Member since 2021 · 1 post · 1 vote
    4y

    I found this map that can zoom in to the aftermath. It’s amazing the difference in damage within a short distance. A lot of area looks barely touched and then of course you have devastation in Fort Meyers Beach. 

    https://storms.ngs.noaa.gov/st...

    Thanks for this resource.  Very helpful indeed to see aerial photos of impacted areas taken in the last couple of days  


    1Reply
  • Allen Wu
    Rental Property Investor · Member since 2021 · 335 posts · 193 votes
    4y
    Quote from @Bernard Joseph S.:
    Quote from @Don M.:

    My thoughts go out to everyone affected by Hurricane Ian.  Of course, SWFL got a large brunt of it, and the islands look pretty devastated.  From media coverage and contributors on the forums, it looks like much of Cape Coral fared well (relatively speaking).  Obviously, the most important focus is on those who experienced loss of life, need rescue, and experienced total loss; again, my heart goes out to those people.

    From an investment standpoint, hurricanes are obviously a real, calculated risk of the area.  It will be interesting to see how the storm may affect build times, with so much need for labor, repairs, and construction in SWFL. At this point, I believe most of Cape Coral is without power still.  It will also be interesting to see how values could be affected down the road, as well. 

    I found this map that can zoom in to the aftermath. It’s amazing the difference in damage within a short distance. A lot of area looks barely touched and then of course you have devastation in Fort Meyers Beach. 

    https://storms.ngs.noaa.gov/st...

    My first concern is with the people who are suffering, but of course we have to think of our investments as well. This isn’t good for anyone and will take quite awhile to resolve. 

    Thanks so much for this….. I’ve been so worried about by home there. 
    1Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    3y

    Update:
    Lot scraping is tentatively scheduled to start this week.  Fingers crossed that will be on track.

    A bit delayed, but that part is definitely understandable, given the impact of Hurricane Ian, long power outages, debris, and current projects needing repairs.

    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    3y

    Updated timeline:

    January 2022: Build Contract with builder completed.
    February 2022: Closed on Lot (cash purchase).
    February 2022: Deposit sent to Builder.  Permit packages initiated.
    June 2022: Completed permit package submitted to City of Cape Coral.
    August 17, 2022: Permit for construction approved by City of Cape Coral.
    September 13, 2022: Permit for Seawall slope approved by City of Cape Coral.
    September 28, 2022: Hurricane Ian hits Cape Coral as Cat 4. Hurricane.
    November 2, 2022: Informed that lot scraping/prep was slated for that week.
    November 10, 2022: Informed that lot scraping/prep was delayed, but would be completed by end of the week.
    November 18, 2022: No response on update, as of time of this post.

    0Reply
  • Pretty Khare
    Investor · Austin, TX · Member since 2021 · 83 posts · 80 votes
    3y
    Quote from @Don M.:

    Updated timeline:

    January 2022: Build Contract with builder completed.
    February 2022: Closed on Lot (cash purchase).
    February 2022: Deposit sent to Builder.  Permit packages initiated.
    June 2022: Completed permit package submitted to City of Cape Coral.
    August 17, 2022: Permit for construction approved by City of Cape Coral.
    September 13, 2022: Permit for Seawall slope approved by City of Cape Coral.
    September 28, 2022: Hurricane Ian hits Cape Coral as Cat 4. Hurricane.
    November 2, 2022: Informed that lot scraping/prep was slated for that week.
    November 10, 2022: Informed that lot scraping/prep was delayed, but would be completed by end of the week.
    November 18, 2022: No response on update, as of time of this post.

    Don.. can I ask who your builder is? Thanks 
    2Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    3y

    Update, lot cleared and scraped.

    1Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    3y
    1Reply
  • Don M.
    OP
    Member since 2021 · 135 posts · 203 votes
    3y

    We took a trip to Cape Coral last week.
    The area seems to be getting back to routine.  There are still a ton of roofs with blue tarps needing repair/replacement and some debris sitting curbside.  
    Otherwise, we thoroughly enjoyed the area.  In driving past our property, we saw that a bunch of fill dirt was brought in for elevation/grading.

    We also did a visit to Pine Island which has a lot of areas of worse damage.  Driving through Matlacha to get to Pine Island was particularly tough to see.  The area truly looks devastated, yet you can still see the charm that was there and will be back again.  There were people out and about smiling and offering free food to other residents.

    Through the ups and downs, we continue to believe in the project and the area.

    3Reply
  • Peter Davis
    Real Estate Broker · Cape Coral, FL · Member since 2014 · 382 posts · 300 votes
    3y

    @Don M. I'm glad you enjoyed your visit to Cape Coral, Don. You're right, we're a resilient city and a lot of neighbors helping neighbors. We'll come back better and stronger!

    2Reply
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