With the increased cost of materials and labor their losses are exceeding policy income.

New construction offers a unique blend of potential high returns and control over the investment, making it an attractive option for those looking to diversify their portfolios.The Advantages of New Construction InvestmentCustomization and Control: New construction projects offer investors the chance to tailor properties to meet current market demands, ensuring higher occupancy rates and returns.Energy Efficiency and Sustainability: Modern constructions come with the latest in energy-saving technologies and sustainable materials, appealing to a growing eco-conscious tenant base.Lower Maintenance Costs: With everything brand new, the initial years following a new construction project see significantly lower maintenance costs compared to older properties.Tax Incentives: Many regions offer tax benefits for new construction projects, especially those that meet certain environmental or economic development criteria.How to Approach New Construction InvestmentEmulating Buffett's investment strategy involves careful market research, understanding local real estate dynamics, and potentially partnering with experienced developers.

The contractor takes that money and buys some materials and holds some money to pay his labor for a few weeks and then he can work off the draws from there and then at the end of the project you get your 20% back minus draw fees.   

Definitely, if you know what you are doing, keeping the costs low (which is difficult in this market with cost of material rising), it might work out. 

To be considered a trade or business for the qualified business income deduction, all of these must be true:Your participation in the rental activity must be regular, continuous, and substantial.You conduct the rental activity with the expectation that you'll make a profit.The rental activity is conducted in the United States or Puerto Rico.Rental activities that are considered trades or businesses include:A real estate professional who materially participates in the activityA rental to a commonly owned trade or businessRental activities that aren't considered trades or businesses include:Rentals for less than fair market value (FMV)A lease agreement in which the tenant pays for real estate taxes, insurance, and maintenanceA vacation home that's rented out and also used as a personal home

That way, you will likely already have hit your 100 hours of material participation, but your cleaners, for example, would not have exceeded you since you would have only had a few bookings before the end of the year.Also, another good one, is that material participation does not count until you are in contract on a property.  

New metal roof & gutters, new covered porch, new side deck Trex material, new large capacity water heater, new Bluetooth thermostat, new sump pump, new HVAC ducts, new HVAC lines, new LED backlit mirror, new electric wiring for entire house, inspected and up to code, new plumbing is all PEX line plumbing, What made you interested in investing in this type of deal?

We for example, are OK with "Cabin Style" under this brand-new definition - since this issues comes up frequently:Properties with “Cabin Design (Style)” per appraisalreport are eligible if Foundation Walls = Concrete Block Roof Surface = Metal or Shingles Heating = FWA Interior Walls = Drywall or Plaster

:-new metal roof that will last a lifetime-new gutters-new covered porch-new side deck entrance made of Trex material-new large capacity water heater -new Bluetooth thermostat.

Awesome material, really looking forward to the new one.