Why New Construction Might Be the Smartest Play in Real Estate Right Now
Summary
This article, presented by Lennar, suggests that new construction homes may be a better investment for rental income than older homes due to lower maintenance costs and higher demand from renters seeking modern amenities. Consider exploring new construction opportunities in markets like Dallas to potentially boost your rental income and portfolio growth.
Key Insights
- •The U.S. was approximately 4.7 million housing units short as of 2023, according to Zillow, and demand for rentals is high.
- •65% of renters are willing to pay more each month for smart home features, such as smart locks and security cameras.
- •Investor B buys a brand-new, $300,000 home. The rent is $2,000 a month. Taxes and insurance are slightly higher, but maintenance is nearly nonexistent. Their net is closer to $1,400 before debt service. Even though Investor B paid more upfront, they came out ahead because their cash flow wasn’t eaten alive by repairs and turnover.
Action Items
- ✓Consider exploring new construction opportunities in markets like Dallas.Effort: mediumImpact: medium
Tools & Resources
- →Lennar's Investor Marketplace: Lennar’s Investor Marketplace delivers curated, turnkey new homes across 90+ markets.
Watch Out For
- ⚠Chasing older homes, fighting with contractors, and juggling higher turnover rates can be a full-time job.
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