New Construction Investment Homes
Buying a new construction investment home or Investment Property is different than buying traditional real estate although most of the rules are similar. New construction property sales representatives work for the builder (unless you ’ re dealing with an independent real estate brokerage). If you buy a new home through the builder ’ s sales rep you will have no one representing your interests but if you deal with an independent brokerage they can give you insight into not only the specific project but the developer and location as well. Most states do not require builder sales persons to be licensed real estate agents which means that is the only property that this commission sales person can sell you. When purchasing new construction investment properties we recommend using a real estate brokerage that specializes in preconstruction homes and opportunities. YAERD works with respected realtors that personally hand picks every new construction project and development.
1) Choose your New Construction Real Estate Agent Wisely – The home buying process is full of traps for the unwary, inexperienced, and even the experienced home buyer. A good investment real estate agent can help you find the best new construction homes and houses in the best locations. Understand that not all real estate agents are equal, spend some time interviewing agents and only deal with them if you feel they are knowledgeable about the industry as a whole and not just a handful of specific projects.
2) Know What New Construction Project You Can You Afford – Your Buyers Agent will insist that you to be pre-approved for a mortgage (not pre-qualified) before starting the home search so he isn ’ t wasting yours and his time. They will probably direct you to 2-3 different bankers/mortgage companies that they are confident can follow through and close your loan will little or no hassles. You will find that many builders usually have the own financing companies available that offer special incentives if your referred to them by the brokerage or builder. Example, YAERD offers their points of commission from the mortgage company to their clients which will shave several points off the top of the loan...
3) What New Construction Developer is Best For You – Your new construction agent will help you determine your specific needs and preferences before shopping for a project or developer. What area is going to explode with business over the next few year? Which developer has the best track record of keeping a development rented (which will increase your monthly ROI)
Now you and your buyer agent can look for subdivisions or custom developers in that area who will best address your needs. Take your time, shop around. Inspect model homes, pick-up brochures with floor plans and pricing become educated before making your choice.
4) Select Your New Construction Community – What amenities are you most interested in, pool, tennis, golf, club house, gated community? Is there a homeowners association if so you must have a copy of the restrictions these tell you what the community rules are regarding what you can and can not do with your own property (i.e. some comminutes do not allow you to alter landscaping or have an outdoor barbeque. Your buyer agent can help you check local land use regulations and what is planned on the vacant land nearby you may end up with a 24 hour gas station behind your new home.
If you have any questions,
need advice, or just want free information on our newest
properties in Minnesota available please call
our investment hotline.
