In the process of buying single-family rental properties in Stockbridge, it’s vital that you understand both the pros and cons to choosing a newly built home. Even though newer properties present owners significant benefits such as more customization, higher energy efficiency, and lesser upkeep in the first few years, all of these things may require you to spend more initially. This is usually the case not only because upgrades aren’t cheap, but simply because there is typically very little room to negotiate on price. So, regardless of which property you select, it’s essential to weigh all of the pros and cons carefully to make sure that you’re attaining a solid return on your investment.
For so many reasons, buying a new home to use as a rental property can be a good investment. From a cost standpoint, new construction lets investors have the chance to purchase and soon after rent out a beautiful, attractive rental home with a range of attractive upgrades. Because the upgrades are already calculated in the purchase price, there won’t be as much out-of-pocket repair and improvement expenses to have the property ready for your first tenant.
If the new home is all set for move in, rental income can start at once. Also included in the price of a new home are an assortment of upgrades that can help investors customize the rental home to appease a particular renter demographic. For instance, a new home that has been upgraded with smart technologies will probably be more appealing to a Millennial renter than one that has not.
Tenant appeal is an influential determinant in any successful rental property, and new homes offer renters something older properties cannot: the opportunity to be the first and only tenant who has inhabited the home. A brand-new property also allows renters significant utility savings, because newer homes typically have higher energy efficiency throughout. Renters who would like to stay long-term may be especially interested in these features, and by the likelihood of retaining a modern, low-maintenance, energy-efficient home for many years to come.
Though these are entirely compelling reasons to invest in a new home for your following rental property, there are certain downsides to recognize as well. For instance, it’s important to distinguish that not all builders are equal and that some may utilize cheap materials or try to cut corners to save money.
Procuring shoddy construction can lead to endless haggling with the builder to try and get things done correctly, as well as higher repair and maintenance costs if you can’t get them to do the work the right way. Another detail on the con side of things is the often-limited number of options available. Even if customization is conceivable to a degree, it is more often a question of choosing between a very limited set of wall colors, countertop styles, and so on, or risk driving the purchase price up even higher.
In conclusion, if you are an investor who prefers a good bargain, buying a new home may not be the appropriate choice for you. This is because the price of new construction isn’t always concluded by the market or a previous owner, regularly leaving room for negotiation.
When you’re buying from a builder, they may not be as open to negotiation because lowering the base prices on their homes alters the data on comparable properties in the neighborhood and encouraging future buyers to attempt and talk them down too. Of course, these circumstances may vary depending on the events, and it’s always an excellent approach to ask for any available discounts or other financial incentives.
It is essential to contemplate on all the pros and cons before deciding to buy a new home to utilize as a rental property in Stockbridge. But with so much to examine, it can be challenging to know whether a new property is a right investment for your market and demographics.
You need comprehensive market information, like the kind extended to all property owners working with Real Property Management Anchor. We perform market assessments for all potential rental properties, ensuring that owners who partner with us have the tools and information they need to make the best possible investment decisions. For more information, contact us online or give us a call at 678-467-3039.
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