Real Estate Broker · Omaha, NE · Member since 2020 · 329 posts · 203 votes
3y
Most people that are building these barndominiums are building them as a primary residence, so I don't know that there is enough data as to whether or not they would be successful as investments. I would suggest talking to community banks about how they will estimate the value. If your lender will be using the comparable approach, it might be difficult to get a loan as there probably isn't a whole of comparable sales since they are really new to the market. If they will be using the income approach, then all you are doing is putting together a business plan for the lender showing them how your project will more than support the debt service and be a viable investment for the bank.
I would expect rental rates to be comparable, I think this a really good idea and one I have definitely considered myself! Get really good at estimating build cost, rental rates and be ready to pivot constantly as you enter into the development world!
Real Estate Broker · Omaha, NE · Member since 2020 · 329 posts · 203 votes
3y
Most people that are building these barndominiums are building them as a primary residence, so I don't know that there is enough data as to whether or not they would be successful as investments. I would suggest talking to community banks about how they will estimate the value. If your lender will be using the comparable approach, it might be difficult to get a loan as there probably isn't a whole of comparable sales since they are really new to the market. If they will be using the income approach, then all you are doing is putting together a business plan for the lender showing them how your project will more than support the debt service and be a viable investment for the bank.
I would expect rental rates to be comparable, I think this a really good idea and one I have definitely considered myself! Get really good at estimating build cost, rental rates and be ready to pivot constantly as you enter into the development world!
Rental Property Investor · Indianapolis, IN · Member since 2018 · 4k+ posts · 4k+ votes
3y
@Account Closed A new build barndominium, in my opinion, is a just a fade in new construction.
We see them in Indiana. Unless you own a business, collect cars, run a farm, operate equipment, etc. they don't make sense. They prioritize the garage over functional living spaces. And that statement is coming from a "car guy" that loves wrenching on stuff.
Rental Property Investor · Indiana...mostly · Member since 2019 · 468 posts · 245 votes
3y
Similar to @jaron walling, i see several within 5 miles of my PR. I wonder if they are a fad or the future. They have giant flexible spaces. Might not be a fad.