Imagine you're cruising through a brand-new neighborhood, where every home seems to shine with a bright exterior, clean windows, newly poured walkways, and the smell of fresh paint. The air sparkles with the excitement of things to come.
It sure beats the last neighborhood you drove through where the houses were all 30 years old. The driveways were cracking and the roofs looked one strong storm away from shedding their shingles like leaves in the fall. The homes were cheaper, but it’s hard to say if they are a diamond in the rough or plain rough.
Investing in new construction brings a dynamic energy to your portfolio. But more than that, it builds equity in a property that will bring a lineup of renters eager for a clean slate. Being the first to walk the halls, draw the curtains, and flip a light switch is a feeling you cannot replicate.
New construction offers a host of perks that older homes can't match. From energy-efficient designs to customizable layouts, newly built homes have a beauty all their own. Ready to take on something new? Let's talk about the benefits of investing in new construction.
1. High Rental Appeal
You cannot deny the appeal of a brand new home in an up-and-coming neighborhood. That “new construction smell” is enough to draw attention to the property. Throw in some never-used appliances, walls without scuff marks, floors that don't squeak, faucets that never leak, and doors that freely swing when opened, and heaven is officially a place on earth. You are sure to have renters lined up for the foreseeable future. It is the definition of a turnkey property–ready and liveable from day one.
2. Low Maintenance and Warranties
If you love spending your weekends replacing toilets, patching drywall, and tearing up old linoleum floors, a newly constructed home isn't your vibe. But if you are looking for a profitable rental property with little maintenance from the start, a new build is right for you. Most builders also offer warranties on their work, taking the pressure off you to repair or replace any problems that creep up as the house and your new tenants settle in. These warranties typically last from one to ten years. Every investor dreams of receiving passive income from a real estate investment. Turnkey properties may make you feel like you are living the dream.
3. Less Competition
Real estate investors often look for inexpensive properties like foreclosures. However, these types of properties can be hard to come by, and there is a lot of competition surrounding the sale. Developers often construct newly built homes in areas full of development, offering plenty of brand-new houses to choose from. Multiple units are released simultaneously, giving you ample opportunity and less pushing and shoving to get what you want.
4. Property Appreciation
While it is impossible to predict how much your property value will grow, it is likely that your newly built home will appreciate in value over time. As new neighborhoods continue to grow and develop, more homes are built, amenities such as schools and shopping centers are added, and the area becomes more popular. Though the upfront costs of a new build may be higher, with a little patience, the long-term return on your investment will grow as the resale value increases.
5. Energy Efficiency
A considerable advantage of a new home is its energy efficiency. New insulation and tightly sealed windows and doors keep air from escaping, allowing the house to stay cool in the summer and warm in the winter. Newly purchased appliances also allow for low energy consumption, keeping utility costs down. Low utilities benefit you and your renters. Lower utility bills are always a draw for those looking to rent. Energy efficiency also boosts your resale value when the time comes to move on to other properties.
6. Customizable
Newly built homes are a blank canvas. As the homeowner, you choose the paint color, the type of carpet, hardwood, or laminate flooring you like, and the stain on the kitchen cabinets. Want materials that are ultra durable, easy to maintain, or inexpensive to replace? The builder can put it in from the start, no matter your preference—no more bathroom demo projects to remove that ugly green tile from the shower. Instead, accomplish your vision with new home construction. You can decide what finishes will work best for the home and put them into place before the occupants move in.
7. Location is Everything
Even if the inside of your rental home is perfect, you can't erase what's happening outside. The whistle of a train in the early morning hours is a deterrent for those looking for a home to rent. Choosing a place with easy access to shopping, movies, fun parks full of open space, quality schools, and an overall safe environment will make a huge difference. Not only is it more appealing to those looking to move in, but it also adds to the property's resale value. Location is everything; with a new build, you can choose the perfect spot for your investment.
When deciding on the best option for your next property investment, you should take the chance to invest in a newly constructed home. Don't let high upfront costs scare you away. A myriad of benefits quickly absorb them. With the high appeal to renters, lower maintenance costs, energy efficiency, and long-term appreciation potential, newly constructed properties offer financial security in ways that older homes can't provide.
