During such time when you decide to buy single-family rental properties in Plantation, make sure you remember that there are both pros and cons to choosing a newly built home. The reality is that newer properties have extra benefits like freedom to customize more, higher energy efficiency, and less upkeep in the first few years, but all these things may cost you more up front. This is frequently valid not only because upgrades aren’t cheap, but because there is usually very little room to negotiate on price. No matter which property you choose, it’s significant to weigh all of the pros and cons carefully to guarantee that you’re receiving a solid return on your investment.
In several ways, buying a new home to use as a rental property can be a good investment. Looking at everything at a cost standpoint, new construction does give investors the chance to purchase and instantly rent out a clean, beautiful rental home with a range of attractive upgrades. And, because the upgrades are included in the purchase price, there will be little if any out-of-pocket repair and improvement expenses to get the property ready for your first tenant.
If the brand-new home is instantly available for move in, rental income can commence right away. Also included in the price of a new home are a series of upgrades that can help investors customize the rental home to interest a particular renter demographic. For instance, a new home that has been upgraded with smart technologies will likely be more attractive to the Millennial renter than one that has not.
Tenant appeal is a significant 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 resided in the home. A new property also allows renters significant utility savings, since newer homes tend to have higher energy efficiency throughout. Renters looking to stay long-term may be particularly intrigued by these features, and by the prospect of enjoying a modern, low-maintenance, energy-efficient home for many years to come.
While these are all compelling reasons to invest in a new home for your subsequent rental property, there are several downsides to consider as well. For example, it’s imperative that you recognize that not all builders are equal and that some may use cheap materials or try to cut corners to save money.
Purchasing shoddy construction can initiate 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 part on the con side of things is the often-limited number of options available. Although customization is possible to a degree, it is more often a matter of choosing between a very limited set of wall colors, countertop styles, and so on, or risk driving the purchase price up even higher.
Eventually, if you are an investor who prefers a good bargain, buying a new home may not be the best option for you. This is because the price of new construction isn’t always defined by the market or a previous owner, frequently 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 encourages future buyers to try and talk them down as well. Indeed, this circumstance may change depending on the details, and it’s always a great approach to ask for any available discounts or other financial incentives.
It is imperative to balance all the pros and cons before selecting to buy a new home to use as a rental property in Plantation. But with so much to consider, it can be hard to know whether a new property is the right investment for your market and demographics.
You need detailed market information, like the kind offered to all property owners working with Real Property Management Asset Solutions. 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 954-889-5627.
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