Developer · Indianapolis, IN · Member since 2024 · 21 posts · 9 votes
I build new construction duplexes and quads in Indianapolis, so I'm on the other side of this conversation a lot. These are the questions I think every buyer should ask, whoever the builder is.
Was it designed as a rental? Two full baths, flooring that can take a beating. A house built for an owner-occupant and then rented out usually doesn't hold up the same way.
When is the CO coming? That one date drives your closing, your loan, and when you can start depreciating it. If someone gives you a vague answer, push on it.
What does the warranty actually cover? Get the 1-2-10 terms in writing and find out who stands behind years 2–10.
What are past units actually renting for? I'd want real rents from past buyers, not the pro forma.
Who's managing it? Have your PM lined up before closing. A brand new unit sitting empty in month one hurts.
Will your lender do new construction? Some DSCR lenders have extra hoops for new builds. Ask early so you don't find out two weeks before closing.
Anyone who's bought new in Indy, what else would you add?
Alec's list is solid — the operator add I'd make is about the first 90 days after closing. We run 236 doors in Memphis, mostly single-family, and a new build's first year is where the money is made or lost.
On your PM question: have the manager lined up before closing, and ask the same questions you'd ask on an existing rental — how they screen, how they handle turnovers, and how rent is collected. We screen on verified, repeatable income and consistency between the story and the paperwork, and we write one rent payment method into the lease, the same for every house.
On real rents: ask for signed leases or rent rolls from past buyers, not just the pro forma, and underwrite the first year at a real vacancy number. A brand-new unit sitting empty in month one hurts exactly because there's no cash flow yet to absorb it. And get the move-in walkthrough documented with photos before the first tenant moves anything in — that record is what protects the deposit later.
What does the warranty cover on the systems that fail first — HVAC, water heater, roof?