If you have considered purchasing single-family rental properties in Bangor, bear in mind that there are both pros and cons to choosing a newly built home. Although brand-new properties have benefits like further customization, higher energy efficiency, and not as much maintenance required in the initial few years, all these things may cost you more from the start. This situation holds true most of the time, not only because upgrades aren’t cheap, but for the reason that there is generally very little room to negotiate on price. Irrespective of which property you pick, it’s crucial to weigh all of the pros and cons carefully to guarantee that you’re attaining a solid return on your investment.
In a lot of ways, buying a new home to use as a rental property can be a good investment. From a cost standpoint, new construction gives investors the chance to acquire and instantly rent out a brand-new, charming rental home with a range of attractive upgrades. Since the upgrades are counted in the purchase price, there won’t be a lot of out-of-pocket repair and improvement costs to get the property ready for your first tenant.
In case the new home is readily available for move in, rental income can start straight away. Included in the price of a new home are also a range of upgrades that can help investors customize the rental home to entice a particular renter demographic. For example, a new home that has been upgraded with smart technologies will likely draw more of the Millennial renter than one that has not.
Tenant appeal is a central aspect in any successful rental property, and new homes offer renters something older properties cannot: the chance to be the first and only tenant who has dwelled in the home. A new property also offers renters significant utility savings, because more modern homes are susceptible to having higher energy efficiency throughout. Renters that are looking forward to stay long-term may be predominantly attracted by these features, and by the prospect of enjoying a modern, low-maintenance, energy-efficient home for many years to come.
Despite the fact that these are all compelling reasons to invest in a new home for your succeeding rental property, there are a number of disadvantages to study too. For example, it’s important to remember 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 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 item on the con side of things is the often-limited number of options available. Even though customization is conceivable 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.
Lastly, if you are an investor who likes a good bargain, buying a new home may not be the right option for you. This is because the price of new construction isn’t always determined by the market or a previous owner, often 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. Of course, this situation may change depending on the conditions, and it’s always a good idea to ask for any available discounts or other financial incentives.
It is essential to evaluate all the pros and cons before selecting to buy a new home to use as a rental property in Bangor. But with so much to consider, it can be hard to know which new property is the perfect investment for your market and demographics.
You need detailed market information, like the kind offered to all property owners working with Real Property Management Acadia. 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 207-561-7482.
We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.