Trends and Opportunities in New Construction Investing

Trends and Opportunities in New Construction Investing

New properties are an often-overlooked category in real estate investing, but in today’s low inventory environment they are becoming an increasingly viable strategy. All across the nation investors are finding ways to turn a profit by building homes and subdivisions. New construction projects can serve as a rewarding investment while also delivering much needed homes to underserved communities. There are also some key techniques you can make use of to help ensure your investment will be profitable. Continue reading for our guide on the trends and opportunities available in new construction investing today.

Modern townhomes

Sustainability and Green Building Practices

New homes have a much higher emphasis on sustainable building materials and energy efficiency. The great thing about many of these features is that they don’t cost an exorbitant amount to incorporate, but they can become a key selling point when marketing and listing the property. Many of these features also help lower the monthly maintenance costs on a property, which is a huge benefit for owners. Look into some ways to incorporate green building practices before construction begins to make the most use of this rapidly developing area.

Smart Home Technology Integration

Smart homes are also becoming increasingly popular in new construction. It’s relatively easy to add a camera doorbell to a home, and most thermometers these days can be accessed with a phone. Along with that, you can add smart security features and lighting that can be controlled with voice-activated assistants from Google or Amazon. These features add convenience to a home, and can even save money, which helps increase the property’s value while also appealing to potential buyers and renters.

Flexible, Multi-Use Spaces

After the rise in the number of people working from home as a result of the covid pandemic, there has also been an increase in the demand for flexible spaces in homes. Most of the time these spaces will end up as an at-home office, but they can also serve a variety of other uses, like a breakfast nook or even just extra storage space. It can also serve as a crafting station which helps appeal to buyers and renters with children. Be sure to highlight the opportunities for an extra space (or bonus room) like this in your listing to appeal to a number of different people.

Starter Homes, Multifamily, & Mixed-Use Properties

As an investor, there is potential for you to tweak your strategy to maximize your returns. In certain markets there will be more demand for smaller properties, and it may make more sense financially to divide your capital and invest in building 2 manufactured or starter homes. However, a multifamily property can also be worth the investment, as they offer better cash flows and cap rates. You may also want to consider a mixed-use property that combines the potential for business income and monthly rent. Be sure to explore various strategies and compare them to find creative ways to boost your return on investment.

Health and Wellness Amenities

There is a growing trend of incorporating more health and wellness oriented features in the home. With the rise of Peloton bikes and other at-home exercise programs, converting a spare room into a dedicated fitness area can be a desirable amenity. It is relatively common for multifamily properties to feature a gym, but you may also want to consider adding an outdoor recreation area, such as a commons where tenants can meet and enjoy nature.

RCN Capital

The easiest way to save on a new construction investment is to work with a trusted lender that can get you the best leverages and rates. RCN Capital lends to real estate professionals, commercial contractors & developers 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 an investor looking to acquire financing for a construction project, RCN Capital has competitive loan options available.