The prospect of new construction investments remains appealing in 2025, especially with low inventory driving competition in many markets. That, combined with the growing demand for modern, energy-efficient homes from homebuyers makes new construction a great strategy in the coming year. For brokers and wholesale partners, you can help clients capitalize on these opportunities by guiding them through the construction investment process. You can also highlight the benefits of this asset class to your clients to position yourself as a knowledgeable investment partner.
In this piece, we’ll highlight 5 reasons investors should consider new construction in 2025, along with how brokers can offer their insights to help clients make the most of their investment projects.
Demand for new houses with energy-efficient features and modern design continues to grow among buyers. Both investors and homeowners are drawn to properties with lower maintenance and long-term appeal, as new homes tend to appreciate better than older ones. Brokers can help their clients by communicating the long-term benefits of new construction assets. You can also offer your expert insight by identifying prime markets with high demand for new construction, and specific locations and neighborhoods that would make for a good investment.
Another major appeal of new construction investments is that they are often easier to lease than existing homes and fetch a higher price on the open market. The modern features appeal to renters and the homes are already move-in ready, which makes them easier to market to renters or fill vacancies when they occur. Additionally, homes can be built to spec, so investors can customize them with features that will appeal to the audience they are marketing to, and in turn maximize their ROI. For brokers, you can help your clients by giving them advice on which features to include in their projects and assisting them with their marketing efforts.
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5 REASONS TO CONSIDER |
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High Demand for Modern Housing |
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They're Better for Leasing |
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3. |
Cost-Efficiency |
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4. |
Tax Advantages |
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5. |
Scalability and Long-Term Potential |
People often overlook the cost savings new construction properties provide when it comes to maintenance and repairs. For starters, new homes are less likely to require repairs in the first years after they’re built, and often come with warranties to cover any defects, should they occur. New homes are also built with more efficient materials and appliances, which means monthly bills are reduced for owners. This can become an additional selling point when marketing the listing for the property. Brokers can educate their clients on the cost benefits of new construction investments and provide data on how they can be more cost effective than other asset classes.
Most investors don’t realize that there are various tax benefits that come with new construction projects, which they can make use of to reduce costs and improve their ROI. First, many states offer energy-efficient tax credits for properties that meet a certain efficiency threshold, and this can help reduce the overall cost of construction. Additionally, investors can make use of depreciation by conducting a cost-segregation study, where assets on the property are depreciated over their usable lifespan. Brokers can help investors by introducing them to various deduction strategies and connecting them with tax professionals to help them maximize their deductions.
New construction projects offer investors a scalable and repeatable investment model, especially if they find a growing housing market or a great location like a subdivision that will gradually get built out over time. Investors can build a strong long-term rental portfolio out, one property at a time, and they can expect strong appreciation due to the modern features and high demand for these homes. As a broker, you can advise your clients throughout the process of building a sound investment portfolio, or help them find good markets and neighborhoods to invest in.
The easiest way to save on an investment is to obtain financing from a real estate lender that can provide you with the best leverages and rates. RCN Capital lends to real estate professionals, commercial contractors, developers & small business owners across the nation. We provide short-term fix & flip financing, long-term rental financing, and new construction financing for real estate investors. If you are looking to finance a real estate project, RCN Capital has competitive loan options available.