By luck I was introduced to my brokerage that specializes in investing education, and figured my biggest competitive advantage was executing on what was being taugh to me.

I have a big chunk of cash saved that I need to put to use, but I'm having trouble determining the value of a new build vs a more traditional deal just buying a rental and rehabbing.I've been presented with an opportunity from a builder to build a new duplex in an area which can be used as short-term or long-term rentals in Knoxville, TN.The builder is a rare combination of fast, cheap, AND quality, and has written a "cost-not-to-exceed" clause into the building, so it's an extremely competitive build cost (details below).The deal would cash flow very nicely, but it would force me to leave a chunk of cash into the property.Here are the numbers:duplex: each unit 2:2, 900 sq ftTotal cost of land, 1.2 acres (This is already leveled, excavated, and prepped for building): $80kMaximum build cost: $252kTotal cost: $332kCash in: $67,000ARV: $350kApprox cash flow: $800-1,100So, again, how does this compare to a typical buy/rehab?

Or why would they not price drop to be competitive in the area where the size of the home medium prices are around 550k.any good insight would be great to hear.

A lot of competition amongst capital leads to lower cap rates.

No competition, you do get to negotiate a bit and they will contact you in the future if they have any properties.  

I would assume that investors would be competitive with getting hold of potential deals.

Many home builders are also offering competitive pricing and very strong incentives.If you’re a seller, you can expect slower conditions with many buyers taking a “wait and see” attitude.

Keep in mind - operating the STR to it's peak performance will require diligent thought and effort to best generate reviews, drive up the nightly rate and occupancy, and maintain an edge over your competition! 

Look at your competition and see what there finished projects are and always try to make yours one step above there’s if possible.

Getting it under market value would be a bonus.So, would using an FHA 203k renovation loan, which would allow me to buy something unqualified for a standard mortgage, which would weed out a lot of competition and push the price lower.