I currently work for a SFR fund that is looking to get into the build-to-rent space. When underwriting for rent we use comparable properties; but in some of our markets we do not have any new build homes to make an assessment for the new build projects.
Have any property managers here seen a difference in the way new builds rent compared to recently renovated homes? And do you have any other insights on renting for new build single family property compared to recently renovated?
-Is there higher demand?
-Should we project a certain $/% higher than a given comp that is recently renovated and rented?
You won't see a big difference in rental amounts for a SFR that was built 50 years ago and recently remodeled vs. a new built home that has a similar design. Tenants don't care much about new build vs. completely renovated (owners and buyers do), assuming the house is still in good condition.
There are differences in rentals when it comes to comparing apartments that were built 50 years ago and new condo developments, but I haven't really seen anything too different in the SFR space.
P.S. If you're at a fund and you're having to outsource this question to BP, hire better analysts lol! Just joshing, I used to work at a RE fund too ;)