I'm curious, has anyone went through the process of pricing out/building a new multifamily build? If so, what conclusions did you come to? Was there a certain unit count you needed to hit to make it profitable? Are you a builder or an investor? I have so many questions so any information would be greatly appreciated!
I'm a contractor up in Minnesota and have always wondered how I could build my own investment properties. I've got connections in the building community with subs, suppliers, etc., plus I have my own labor force to be able to build the structure, which would obviously help keep the costs of building down. Right now with lumber so high, I doubt the numbers would work out but I'm looking towards the future to see if it's something others have done and is worth pursuing further. I've read up on the subject and have seen plenty of people brush off the idea of building, which I can understand if you are not in the world of building/contracting. However, I'm more looking for builders or contractors who have either tried to figure this out or have actually built the structures and seen the project though, whether you were successful or not. I'd love to learn more about what you learned and any suggestions you may have for it, anything from how you bought materials, to how you saved on your design and layout, etc. I have so many questions and am looking forward to connecting with you!
Thank you so much for reading! Have a great day!
I am currently working through a new build deal with one of my family members in SW MN. The property that makes the most since when looking at the numbers is for the property to be 2-4 units. We choose to build a duplex due to the smaller lot size. However, my suggestion would be to speak with a local RE agent and see what the price and supply/demand are for certain bedrooms and bathrooms. I'd use that info to roughly plan out how many bedrooms/baths you can get into the property that would make sense based on the lot size and your budget.
We choose to go down this path because we are in a similar position as you are. We can get interior/exterior finishes at discount due to myself being a PM and my family members owning and/or working as a contractor/design business.
Let me know if you want to chat sometime.
@Aaron Owen - That's awesome to hear! Did you guys do anything different to increase the efficiency of the build to help make the numbers work? I'm thinking things like maybe having a central furnace that runs off of a zone heat system or building on a slab on grade, etc. I definitely agree with needing to get discounts somewhere too. Obviously, I have the workforce that could help with that but I've also considered partnering up with the owners of our local lumber yard to potentially get material at cost (definitely a far-fetched idea but one that they have been considering). Also, any chance you'd be willing to share the plans they used? I'd love to see the layout that they could make work. And speaking of that, what rent are they able to get? Any information on their numbers would be greatly appreciated! Again, thank you Aaron!
Have a great day!
Ive explored this so many times and my final thought is HUD housing. Thats going to be the only way to make money with multi family as a GC building the homes. That said, I still havent done it because its just not as lucrative as the homes we are currently building.
@Account Closed - That's kind of how I feel about it too. I'm not giving up on it yet but we're better off putting our money elsewhere currently which is really what it comes down to. Why take that big of a risk for less of a payoff? Anyways, thanks for the reply Bill!
Have a great day!