Posted about 2 months ago

Ground Up Construction: Hot Markets to Consider & Why

When it comes to real estate, it all comes down to location. The same holds true for ground-up construction projects.

If you’re looking to invest in a ground-up construction project, we’ve laid some of the foundations for you here in this article. Find out why the market is in the state it’s in today, and some of the best areas to target when investing in new-build property.

The state of the market

Personal preferences evolve over time—including how individuals view their ideal living situations. As Millennials mature there is a gradual shift from being predominantly a rent-based demographic to aspiring homeowners.

However, the current national housing market is facing insufficient levels of existing inventory to meet the growing demand for single-family residences. As a result, home values have surged, making it challenging for many aspiring homebuyers to realize their property ownership dreams.

The stark reality is that first-time homebuyers around the country are all running into the same issues: limited inventory, numerous offers on outdated homes, exorbitant prices, and delayed renovation timelines thanks to ongoing supply chain issues.

The good news is that the construction industry is slowly but surely rebounding from the COVID-19 freeze. With the number of new housing unitsincreasing month after month, relief could be on the way for frustrated would-be homebuyers as the market begins to balance out.

The uptick in development activity also presents a great opportunity for real estate investors seeking to expand and diversify their portfolios. Ground-up investments offer a viable alternative for investors struggling with the current limited inventory.

The best US locations for ground-up construction investments

Investors should check out the following top-performing markets for potential areas to focus their ground-up construction efforts to optimize cash flow and ensure consistent profits from a long-term perspective.

Boise, Idaho

Boise is primed as one of the most promising long-term investment markets in the entire country. Home values are skyrocketing thanks to depleted inventory levels and record-low interest rates, with the average listing price currently well above $500,000.

Homes are appreciating at nearly 4.5% per quarter, which equals approximately 20% annually.

Factor in a population and job growth that is three times the national average and you have the ideal spot to break ground on a ground-up investment property.

Dallas, Texas

The already sizeable Dallas metro area is expected to grow even more in the near future, meaning there will be continued demand for housing options. Economists report that around 340 people relocate to the Dallas-Fort Worth area every single day and the population is forecasted to double in size over the next 15 years.

Properties are set to appreciate to the tune of 10-15% in three-years’ time, meaning new builds will only increase in value to add to the potential returns from a real estate investor’s perspective.

Atlanta, Georgia

Atlanta’s population has expanded more than 14% in the past ten years, which has resulted in a consistent demand for housing.

The capital city is Georgia’s main economic hub, meaning there is a steady stream of high-earning employees looking for quality living arrangements, something that ground-up construction directly caters to.

Nearly 500 people move to the Atlanta area on a daily basis and the overall population is set to grow by 2 million by 2030. The economy is ranked 8th in the country in terms of GDP and numerous Fortune 500 companies are located in Atlanta.

All these attributes make this a safe and potentially lucrative site to own an investment property in.

Get Started Today!

Our specialized ground-up construction loans provide the financial support to turn your vision into a reality. Our team of experts understands the unique challenges and complexities of ground-up projects, and we’re dedicated to helping you navigate through every step of the process.

Whether you’re looking to break ground in booming cities like Boise, Dallas, or Atlanta, or exploring other emerging markets with untapped potential, we have the experience and resources to fuel your success.

Don’t let financing hurdles hold you back from seizing ground-up construction opportunities.

Looking for more investment opportunities? Check out our other articles like Multifamily Loans for Commercial Real Estate Investors, Term Mortgages for Queens Properties: Finding the Right Lender and The Best Fix and Flip Markets in the US.