New Construction Rentals

5 Replies

Hello BP-

I'm curious if anyone is investing in new construction for rentals. So far, all of my rentals have come from distressed sales and I've followed the BRRRR strategy. However, the market for these types of deals has dried up in my area and it's difficult to find them. I know the overwhelming approach is to find properties that cash flow but has anyone been able to make this work with new construction?



Are you looking to build your own, or purchase from a builder that's building a new neighborhood?

The HOA's are high on the new build neighborhoods here.

I'm looking at new construction from a builder in the same neighborhood as my other rentals and there's no HOA.

Can you make money? 

That is the key consideration.

@Bill Zepeda I have new construction condos in my portfolio. In the Washington DC area you have to have a strategy in order to cash flow, I buy them as owner occupied and stay in them for 1 year (the only downside) to get the cheaper rate is moving more often, I only buy into small buildings/projects so the HOA dues are low. There are several other strategies involved like don't use the builder upgrades offered, you'll be able to add finishes for much less, offer lower prices for lower floor units since most primary residence buyers all want the higher floors with the best view, the builders have a hard time selling lower floors in most projects so those are the easy targets at the end of Year/Quarter closings.

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