A Brief Guide to New Construction Investing

The world of real estate investing is one that many people find incredibly attractive. There are a variety of options that range from the low risk to the higher risk, all with promising possibilities for solid returns when gone about in the right manner.

Some people choose to take a more passive approach to investing in real estate by simply putting money into a certain project or property that a third party manages. Others prefer to take a hands-on approach by purchasing properties in order to renovate and either sell or lease them out. Ultimately, no matter what your investment preferences are, there are plenty of opportunities for any type of real estate investor.

One option that many people are choosing to partake in is that of new construction investing. This is a type of real estate investing that is essentially what it sounds like. You fund the construction of either a residential or commercial property from the ground up. 

Before you decide to jump into such an investment, it is important to understand the basic premise behind it as well as the factors that will either be working for or against you. While there is no such thing as a guarantee when it comes to investing, when gone about in the right manner, new construction investing can prove to be incredibly lucrative.


The first thing that every new construction investor needs to consider is the manner in which funding will be secured for the project. The key here is to understand just how long it is going to take for your project to be completed. Since new construction projects can take a great deal longer than simpler renovation projects, you will want to consult with a new construction loan company in order to get as much information as possible.

While there are some investors who have enough capital to fund a project of this nature outright, such individuals are not the norm. It is more than likely that you will need some funding in the form of a loan behind you so that you can complete the project properly.


The key to finding success in any real estate project is that of location. The location that you choose for your new construction is going to play a pivotal role in how much of a return you can expect as well as how quickly you will be able to sell your property.

Bear in mind the things that most home buyers look for in an area. Good schools, low crime rates, and an aesthetically pleasing neighborhood should all be on your radar as you select your location.

Make sure to research an area thoroughly in regard to the housing market as well. Look into comparable homes that have sold in the area to get the best idea about how much you can expect to make when you sell your completed new construction. With the right information on hand, you can stand to make a handsome profit on your new construction.