- Posts 2
- Votes 1
Im a new investor looking to purchase my 2nd property for long term investing. I live in the Phoenix metro area, with the market being so competitive here I was thinking of purchasing a new build on the Westside.
I've been looking to purchase in the west valley: Tolleson, Goodyear, Avondale, and Waddell areas. My thought process is new builds are 1st come 1st serve and won't have to worry about the competition. 2nd, my plan is to purchase, live in it for a year and then purchase my next property. Given the current market and projections for the Phoenix metro area, im banking on appreciation and cash flow as rents/market increases.
Tenants, Flipping, and Single Family
- Posts 1.7K
- Votes 1.5K
Hi , in general I'm a fan of new construction homes as an investment. They make a lot of sense operationally assuming the rents track with the value of the home well.
The biggest pitfall or variable I see with new homes is the neighborhood/area/development. IF the developer is doing things that are going to bouy the value of the neighborhood long term (like parks, water features, trails or walking paths, etc) then that can work well for you. IF they do the opposite then you'll likely see a suppression of the potential value of the home. Similarly if the CCRs that the developer institutes (common in my area) caps the % of rental properties in the neighborhood then you could find yourself unable to rent your home out unless you're one of those first X% renting your home out. Finally, you should know that you'll have a long horizon before the value of the home grows like the market overall . . . New construction areas generally see a spike when the vacant lots have all been consumed, and a lag in appreciation up to that point. Not a problem with long-term buy and hold rentals, but for folks trying to be out of a property in 5 years or so it can be sticky.
- Posts 300
- Votes 205
a new build can be a great option for all the reasons you said. I helped a BP investor from Texas 1031 exchange into a new build in Goodyear. He paid $323,000 for a 3/2 in a small KB Home community, waited 4 months to close and immediately rented it out on an 18-month lease. Won't have to worry about the AC, etc., for a while as 1) it's new and 2) it's under warranty. New builds can be competitive, I learned recently. I was showing a couple homes near Norterra in North Phoenix. The sales agent said they had a 200+ person interest list. And this was in a higher price point. All those people won't remain on that list when it comes time to contact them, but still. West Valley is the way to go.
At the AZREIA meeting on Monday night they showed the map of future development for Metro Phoenix (you should be able to find it on the Maricopa Association of Governments website). Development will be occurring so far West and Southeast that Goodyear and Avondale will be the "center of town."
Best of luck!
- Posts 36
- Votes 17
Xổ số vuông hôm nay @Frank Mendez
First time buyer and Investor too. I've really been searching for a duplex or similar to house hack. Didn't even considered new builds assuming the numbers wouldn't work. Like the idea of not having a bidding war too. Best of luck Frank!
Rentals, Traditional Financing, and Analyze Deals
- Posts 100
- Votes 43
I like the idea of investing in new builds. However, I would only buy in Phase One. This will ensure appreciation, and within a year after you have been living there, then the other phases are being finished and the other amenities are established. This creates a desirable neighborhood for incoming renters or the potential to sell for a nice profit.