Looking to finance a subdivision in NH
Hello Experts,
I am an investor in NH and looking into buying a residential subdivision. The lots are already approved by the Town and ready to build. I tried my local community banks and did not get much interest. If someone could share some lenders who typically finance new housing subdivisions, I would really appreciate that.
Thank you in advance,
Nawaz
Hi @Nawaz Azam,
I am not a developer per se, but I did spend several years after college working in large-balance commercial real estate finance.
Your local community banks probably have a fairly good idea of the market and whether or not building out the subdivision would currently be feasible.
Has anyone done a market analysis and feasibility study? Any idea what the projected absorption rates look like? We own a couple duplexes in the Tilton area, but that's not my area of market expertise by any means.
Have you spoken with a local realtor about the average days on market for homes in that area in the price range of what you are planning to build? If they are sitting on the shelf, adding new inventory may not be a viable move.
Also, does the group that did the heavy lifting have a history of completing the construction phase themselves or do they typically sell once they have it at its current stage? If they typically build it out themselves, then their decision to sell this one as an approved subdivision instead is extremely revealing in regards to their own opinion of project viability...
Based on the feeling I have about that area, without doing any real research, I personally wouldn't be jumping at the idea of building spec homes in the Tilton/Franklin market. Naturally, I have no idea where the subdivision is, and can only base my assumption on your location in your profile.
Happy investing,
Troy
I would need to know the level of your experience
@Troy Zsofka Thanks for the detailed reply and suggestions. The project is not in Franklin. I like Tilton, please keep me in mind if you ever decide to sell your Tilton rentals.
@Paul Sofia
@Paul Sofia, I have a good track record with new construction and done plenty of rehabs. This would be my first subdivision though :-). I am working with town officials to see what the bonding requirements would be and should have details soon.