New Construction Build

[Shannon Vistisen]

Good Morning,
I'm looking for some insight on new construction builds. We currently are building a SF with the financial help of a family member. This is for a long-term hold, STR concept. No bank involved just yet.

After we build the structure, is there an general estimate of how much the property/house will appraise for when said and done?

I've researched that some individuals will build, put the build in a 30-year mortgage with a bank, pull out the equity and repeat the process in another build.

First, has anyone here heard about others moving on this process?
Does anyone have experience in this process that they can shed some light on how to go about this.
If you have experience in this, what are the cons/pros about doing a deal like this?

I know a lot of variables have to be taken into account. We are in a highly sought after vacation spot that is growing.

Thank you for any advice you can share!

[Caroline Gerardo]

Comparable sales is how the value is determined. Look for similar square footage, close by sold last three months. Or ask a realtor to give you a range. 

It is VERY dicey to try and get a loan mid stream if you run out of money. The reason is that subcontractors can lien the property and title can be clouded.

You also need to know IF you qualify for x dollar amount that you target. How is your credit, income, other liquid assets and how will those stand up in a year or two when complete?