First Time Multi Family Construction

[Caitlyn Johnson]

Hi! My name is Caitlyn and I have the opportunity to get into a 2.5-acre property for very cheap and want to build on it. I work in commercial property development, but this would be my first time developing anything myself and developing anything residential. I always try to get as much advice from people with more knowledge than I have before getting into anything so I'm hoping there will be some experienced people here who can give me some advice. 

Background - I'm in the southern Kentucky market and that's where the land is located. The area is small but is right outside of Bowling Green (the third largest metro in KY-60 miles N of Nashville) and there is residential construction going on in the area that appears to be selling around $225k on average for a standard 3/2 home. There are currently no duplexes or townhomes in this small town. There is one 3 story apartment complex up the road. Because we do commercial construction in the area, we know from speaking with the P&Z that the most likely scenario for building here would be either single family homes (can fit approx. 6-7), duplexes (can fit 4 side by side units) or townhomes (can fit up to 11 with zero-lot lines). This land was also acquired through our business so there are 4 separate parties involved that will have ownership and will split any profit or income.

Questions - 

1. What I'm struggling with is the fear that the economy could take a turn for the worse and get upside down on the project, which I understand is always on the table but wanted to see what everyone's thoughts were as far as waiting or if it's better to just start as soon as possible?

2. I also wanted to see if anyone had any experience with getting government grants to build affordable rent homes? KY seems to be giving out grants for this, but I don't know anyone personally who has done it and didn't know if this was a good route to check into. I would personally like to make the homes as affordable as possible because so many are struggling to get into homes right now and I would really like to help in any way I can (I'm the only one involved in this deal that feels that way though...)

3. Thoughts on rent to own?

4. Thoughts on HELOCs right now for this kind of construction? 

5. I just watched a Seeing Green episode where David spoke about his loan company offering loans with the price of the land you're going to be building on as collateral. Does anyone have any experience doing anything like that? 

6. What is the best way to make a budget for these kinds of projects based on everyone's experience?

7. I had thought of advertising the properties ahead of time to sell them before construction starts and give people the option to pick a few details on their own just to get the properties sold ahead of time to help with financing. Does anyone have thoughts or experience with this?

I'm sure there are a ton of things I'm not asking or thinking of but would appreciate any feedback. I feel that there is a really good opportunity here for us but want to make sure that it works out for everyone in the best way possible.  So, I'm asking the experts. I know I'm asking for a lot of information, but I've been reading these forums and listening to the podcasts, and this seemed like a great community to bring this to. I really appreciate everyone's help!