New build of 2/2 or 3/2 and why?

Question

Hello everyone!

Appreciate your feedback and insight!

My business partner, who is also on BP, and I are building new builds and we have a location that we are disagreeing on what to build, in San Antonio.  Would love your feedback!

With all being equal (new builds, same location that's ideal for young professionals, same quality), would you build a 2/2 (2 larger bedrooms + study), or would you build a 3/2 (1 large master bedroom + 2 smaller rooms)? And why?

We are planning on building and renting. Some of the highest sold prices have been 2/2.5, so it really got me thinking, could the rental market be the same? Local PMs have been rather useless as they're comparing apples to oranges giving us stats of 2/2 that's renting at $0.6/sqft and 3/2 that's renting at $1.3/sqft...

Thanks everyone.

Best,

Alice

Chris Stroup · Answer

I agree with the 3/2.  We do STR's and our 3 bedroom properties do much better than our 2 bedroom properties.  In the smaller properties, we get people that come stay for a weekend.  In the larger properties, we get families that stay for a week or more.  Not completely relevant but thought it was worth sharing either way.

3/2 gives you more options and more people that will be interested.

Adam Martin · Answer

I would go the 3/2 route.  If someone is fine with a 2/2 a 3/2 will also work.  If someone is in the mkt for a 3/2 your rental will not be considered if it is a 2/2.  For me it is about casting the widest net.  Also as more people are working from home the extra room can be an office.

Robert Neal · Answer

Most folks that I have worked with either have kids or entertain the idea of having children in the future. My main point is that a 2/2 will limit your pool of potential tenants far more so than a 3/2.

Alice Huang · Answer

Thanks Robert, so from your experience, you are seeing a young couple with no kids, or 2 professionals sharing a home, wanting 3/2 or 2/1, rather than 2/2?