What’s the Sweet Spot for New SFR or Duplex Rental Buikd?

Question

What size and configuration are you seeing in your market for dedicated single family residential and duplex new construction?

I’m contemplating building on land adjoining my farm.  No way can I get new construction built for what I could buy preexisting in town, but it would be great to have the unit(s) close and new.  Cost would be even higher since I’d build with steel roofs and high quality components to reduce long term maintenance costs and effort.

I’d pay cash for the build.  Land is paid for.  These would be lifetime cash generators.  Currently ground is zoned ag.  Not a problem for my builds as I have acreage and frontage enough to build even under ag zoning.  Well, septic, power, and concrete drive will be under 25k.

It’s likely I can rezone part or all to medium density housing.  This would give me the option to build a duplex if I wanted, or a PUD.  Min square footage required is 750 sq feet.  I’m thinking 1200-1400 square foot to attract tenants with no more than three in the family. I have a well kept 45 year old 3 bedroom 1.5 bath trailer with a 1.5 garage  on its own lot adjoining the farm now.  It rents well for 1k per month to great tenants.  Rental demand is strong and the community is adding hundreds of more jobs with a new 1.1 million square foot recreation marijuana grow and distribution facility going up three miles away.  Also a new 1,000 megawatt gas turbine electric power plant starting construction this year which will by itself add 400-500 construction jobs to the economy over the next two years.    I’ve had at least one rental for the last 15 years.  Where all these people are going to live is going to add a lot of opportunity.

Thanks for your thoughts,

Scott

Greg Dickerson · Answer

@Scott Katz you  really need to look at your local market and what is renting and what is in demand. Every market is different. Real estate is very local so what rents well in one part of the country may not rent well in another. Even city to city and town to town.

You can check with some property management companies in your area and ask them what product is in most demand.

Scott Katz · Answer

Greg, will do.  I’m meeting with the  subject matter expert who created the zoning map for the township to get his recommendations on zoning and planning.