"Flipping" a New Build or a similar Strategy?

[Jake Helmburg]

Hi all! First time poster here, been lurking for a long time now.

Little background: I am 25 yrs old and currently live in Austin, TX. I work as a civil engineer for developers working on master plan communities, commercial buildings, and multifamily product throughout the Central Texas region. And as everyone on this site probably knows... the market is hotter than hot down here with both the influx of out of state buyers and local buyers!

I currently want to try to capitalize on the market boom here but have struggled to find a way to invest into the market, considering housing prices keep skyrocketing and I don't have enough capital to invest into an existing house. I realized that because I live here in town, I could potentially use new builds to my advantage as follows:

1. Contract with homebuilder in one of the many existing or new master plan communities within greater Austin Area

2. Lock in contract price (generally with a few grand down), and wait the 4-6 months for house construction

3. Close on the house by putting up minimal downpayment, minimal closing costs, etc.

4. "Flip" to buyer at price based on comparable comps in the proximity of the new build

To me this could be done in a way where it could potentially be a double close if I am efficient enough.

Is anyone familiar with this, and is there anything that I might not be thinking of that could be detrimental to this strategy? 

[Bob Okenwa]

@Jake Helmburg

If you're using a conventional loan, take note that there is language in the agreement that a person buying a primary residence single-family home with Fannie Mae must abide by the owner occupancy requirement and must agree to move into the home within 60 days of closing the loan, and to live there for at least a year. You must intend to use the home as your primary residence and double-closing and/or immediate flipping after closing of said home would be contrary to that.