How & Where to Build an Immensely Rentable House

(5-min read)
Recently, we wrote an article about the benefits of building a new rental property versus buying an existing home to rent. One of the benefits we mentioned is your ability to have more control over the house to maximize its renting potential. But what are the characteristics that make renters jump at the chance to sign a lease for a particular home? In this piece, we’re going to look at a few ways to make your build-to-rent house attractive to renters.

Location

While the appeal of building a home in a nicer location can go without saying, it bears repeating. Many aspiring landlords may balk at the prices of land and homes in nicer areas, instead opting to buy or build in more affordable areas. The motivation here may be to save money or they believe they may catch the swelling wave of gentrification in the area. There’s certainly no harm in saving money, but there are significant advantages to building your rent house in a nicer neighborhood.

  • Future property value. It can be easy to forget that, in addition to the profit on the rent you collect every month, another profit source is your equity in a place with a rising value. A nicer neighborhood may seem to be a little bit less exciting of an investment, but it will be much less of a risk.
  • Property and tenant safety. If your build-to-rent house is located in a better area, this will reduce the risk of harm to your tenants as well as your property. Rough neighborhoods may contain vandals, thieves, and other undesirable sorts that may do more than bring down the property value.

Neighborhood

It may seem like we just spoke about this, but the location is not always synonymous with the neighborhood — more specifically, the people.

  • Meet the neighbors. If you’re shopping for neighborhoods in which to build, it pays to meet the neighbors. There’s no harm in knocking on a few doors, saying you’re considering building a house in the area, and asking a few questions about how they like the area. Also, being able to tell potential tenants that you’ve met the neighbors goes a long way in establishing their trust.
  • Favor neighborhoods where most residents own their homes. While you’re meeting the neighbors, ask them if they own their homes or if they are renting. You will want to build your rental house with predominantly homeowners. Not only will living among homeowners add a feeling of prestige for your tenants, but homeowners are known to take better care of their homes and yards. Even more than this, homeowners are more apt to keep you informed of any issues with one of your tenants more so than a fellow tenant would. Keeping out any riff-raff is in their own best interest as a homeowner in the neighborhood.

Home Details

There are a handful of details that renters like to see when looking for new homes to lease.

  • The 3/2 Rule. There’s no real science to back it up, but you’ll want to build a house that is at least a three-bedroom, two-bathroom home. Though renters are undoubtedly open to renting smaller homes, homes with at least two bathrooms and three bedrooms open up the tenant pool considerably. Most of the management of your build-to-rent home is tenant-centric rather than house-centric. Since the size of the house is irrelevant to these tenant issues, you might as well maximize your earning potential while minimizing your time managing said property.
  • Go big on quality — it will pay for itself in the long run. If you’re considering filling your build-to-rent with cheaper materials and possibly used appliances as a means of saving money, don’t. Any up-front savings you were hoping to achieve will be swallowed up in maintaining these substandard elements. While a used dishwasher may seem acceptable, a brand new one won’t be considerably more and is much less likely to break down. A faux-granite countertop may save you some cash upon installation but will appear worn and dingy in a matter of years. A real granite countertop will hold up much better and increase the perceived value of the space for future tenants.
  • Keep rooms neutral and multifunctional. When showing your build-to-rent house to potential tenants, they need to be able to see themselves fitting into what they see. If one space can only be used as a dining room and they don’t entertain, it will be seen as wasted space. When designing the home, aim to keep the various rooms and living spaces multifunctional. Also, choose paint colors that soothe instead of pop. Various tans, grays, and other colors that don’t easily show dirt are recommended. Also, like the point above, opt for a high-quality paint — unless you plan on repainting the home between every tenant.

For additional help, consult the home construction experts at Perry Hood Properties in Tulsa, Oklahoma.

 

Accounting for the Soft Costs of Home Construction

(3-min read)

“For which of you, intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it?” – Matthew 14:28

Building a new home is an exhilarating time, but one with many plates to keep spinning. From strategizing a build timeline to choosing every element that will accommodate every square inch, the process can be both thrilling and taxing. To save money and feel like they are maintaining more significant control of the process, some may choose to forgo the standard practice of utilizing a project manager. While this may seem like a job that any business professional should be capable of performing, one of the more common missteps for do-it-yourself project managers is to underestimate or miscalculate the soft costs associated with home construction. This oversight can end up causing build projects to run tens of thousands of dollars over budget or more.

The Hard Costs vs. The Soft Costs of Home Construction

The Hard Costs

When most of us sit down to crunch the numbers associated with home construction, the vast majority of us will list off items that most frequently fall under the category of “hard costs.” Hard costs are expenses associated with the physical construction of the home structure. Some examples of these costs are the site, site clearance, site grading, foundational elements, building materials, landscaping, construction labor costs, equipment use or rentals, etc. All of these are the “brick and mortar” costs of building a new house.

The Soft Costs

What is frequently called the “soft costs” of home construction are everything else. You may be asking yourself, “but what else is there?” Just as most of us don’t consider these costs, soft costs are comprised of the “invisible” costs of building a home. Some examples of soft costs include the variety of permits, various inspections, accounting, designer’s fees, legal fees, taxes, financing, interest, and the like.

While hard costs still typically outweigh soft costs for a home construction project, the latter still comprise a significant chunk of a building budget. Failure to factor in all soft costs can result in some unpleasant surprises when it comes to finalizing payment details for a home construction projection. When soft costs are accurately accounted for from the beginning stages of a home construction project, the customer is likely in for a rude awakening.

Avoiding Budgeting Miscalculations

Perhaps the best way to avoid budgeting miscalculations and to keep a construction project progressing efficiently is by working with a home construction professional service. The home construction experts from Perry Hood Properties, for example, have helped hundreds design and build the custom homes of their dreams. Perry Hood Properties’ friendly staff assist builders with every conceivable dilemma to ensure a lack of surprises throughout the design, budgeting, and building process.

 

 

Build-to-Rent: 4 Benefits of New Home Construction for Rental Properties

(3-min read)

Are you tired of looking for that perfect house to buy as a rental property — one that oozes rental potential? Why not just build it? Let’s look at a few reasons why you may want to consider building new homes to rent out rather than buying existing ones.

1. New Houses Appeal to Renters

Let’s face it — we all love new stuff. A new house is no exception. While historic houses may possess a certain warm and historical charm, the majority of renters prefer newer homes with updated amenities. If you really want to stand out from the rental competition and maximize the rent price, newer homes are incredibly appealing to renters.

2. Customize New Builds with the Popular Amenities

If you talk to any realtor or landlord, they will tell you that there are certain home design trends that stand out to shoppers. Granite or quartz countertops, open-concept floorplans, hardwood floors, intricate kitchen backsplashes, barn and bowl sinks, his-and-her you name it — the list goes on. Many landlords attempt to update existing homes to reflect design trends. Building new rental properties, however, gives you a clean slate to build homes with design elements that tenants crave.

3. Cheaper Insurance & Tax Credits

If you’re looking to quickly get some money back on a real estate investment, new builder credits, rebates, and incentives can add up. When it comes to homeowner’s insurance, the newer the house, the lower the perceived investment risk. This can make the insurance rates for a new home construction significantly less than an older property. Also, because a new property will be substantially more energy-efficient than older ones, this means that home builders are eligible for a variety of tax credits. If you install solar power systems in the house, not only will tenants love you, but you will be able to watch the tax incentives skyrocket. If you’re looking to maximize your income from a rental property, every bit of savings counts.

4. New Homes Require Much Less Maintenance

Buying an older home as a rental property increases your risk of winding up with a money pit. On the flip side, building a new home to use as a rental property is typically a maintenance home-run. Because everything about a new home has hardly seen the light of day, the maintenance on everything from the appliances to the HVAC unit will be nearly nonexistent for many years to come. To make matters even better, when you build your rental homes with Perry Hood Properties, the home construction professionals out of Tulsa, Oklahoma provide all buyers with a one year builder’s warranty.


Learn more about Tulsa-based home construction experts from Perry Hood Properties today.

 

5 Factors to Remember While Building a House

(6-min read)

If you’re considering building a new home over buying and you’re reading this article, you’ve likely never been through this process before. If you have, it’s been a while. Even though most of us are excited to start looking at layouts, flooring, and accent features for our custom home, many factors go unconsidered until you’re up to your knees in the build. To help you mentally, emotionally, logistically, and possibly financially for these factors, here are five items to consider when building a new house.

1. The Time of Your Involvement

One of the most beneficial aspects of building a house with an experienced builder is simply deciding what you want and leaving it to the pros to make it so. This is all well and good, but some folks fail to consider just how much time out of their lives it may take to fulfill their role in the process even if they’re not swinging a hammer or touching a paintbrush. Considering designs, layouts, materials, testing them, weighing them against each other — this isn’t merely an afternoon with a designer. Those who are building their own house, even with the help of a home construction professional, say that the project can be as time-intensive for them as a part-time job.

If you’re considering building a custom home, there’s no need to rush into the process. Consider what time of year works best for your lifestyle. Choose a season or time when you feel you will be able to give the project the attention it deserves. After all, building your new house should be an exciting endeavor, not something that makes you want to pull your hair out. When you’re able to dedicate the proper time and focus to the project, this will ensure much better outcomes for your family in the end.

2. Consider Your Daily Use of the Space

As you begin looking at home design magazines and websites for ideas, one aspect to give your utmost consideration in the home building process is how you will use the space daily. Go through your daily routines in your head. Your morning routine may include getting out of bed, making a stop into the bathroom to freshen up, then going to the kitchen to make coffee and then maybe reading a book or the news at a breakfast nook. In the evening, you may want to be able to read while some other family members enjoy a round of videogames. The design layout of your home needs to conform to and flow with your daily lifestyle.

Take your daily routines and the proposed use of your home into account when designing a home layout. A simple way of doing this is to create a rough map. This map should include your starting points, ending points, activities to accomplish along the way, and where other family members may be on their routine journeys. Are you going to be able to talk to your spouse while cooking dinner while they’re relaxing? Do you usually do so? Would you like more privacy or a more open feel? Just because open floorplans are all the rage now doesn’t necessarily mean they are what’s right for your family. Consider your options before jumping into a floorplan isn’t the best for your family.

3. Consider Furniture & Cabinet Placement When Designing

“Surely, my furniture and the cabinets I picked out will work flawlessly in this space.”

These are the words of someone likely in for a little bit of disappointment. You may assume that a space will accommodate your furniture or that the particular set of cabinets will flow best in an area. This may be wishful thinking at best. Even though a living space may have the square footage to accommodate a piece of furniture, the shape of the room may make its use awkward.

To avoid any unwanted surprises, keep furniture and cabinet usage in mind as well as dimensions during the design process. Which direction will those chairs face? Will these directions make communication awkward across spaces? Will cabinet doors open in a way that inhibits design flow or foot traffic? Considering how you intend to use the space, the layout of the furniture, and the purpose the cabinets will help you to choose the best options for your new home construction.

4. It Will Look Ugly For a While, But the Best is Yet to Come

Building a new home comes with a variety of exciting phases — breaking ground on the lot, the pouring of the foundation, seeing the frame reach the sky, etc. Still, several phases aren’t so exciting. In fact, some stages of the build are downright ugly. You may visit the construction site of your home to find plywood, darkened corners, and dumpsters filled to the brim with construction leftovers. It can be easy to lose steam and even possibly grow dismayed during a build.

Though a home construction project may go through an ugly patch, remember that the ugly duckling eventually became a beautiful swan. As the days and weeks go by, you will begin to see the light at the end of the tunnel. As windows, drywall, and flooring are installed, the project will start to feel less like a construction site and more like home.

5. Consider Hiring the Right Home Construction Professionals

Nobody ever said that building a home is cheap. When it comes to certain areas, we may be tempted to cut costs. Cutting costs is fine — you should never pay more than you need to. With that being said, what may end up being more expensive in the long run is hiring the wrong home building professional to help you. Between shotty work, inefficient processes, and bad decisions, going with the cheapest builder may end up compromising the value of your home for decades to come.

Talk to the Home Construction Professionals from Perry Hood Properties

Whether you’re considering building a home, but don’t know where to begin or you’re already halfway through the process, the home construction professionals from Perry Hood Properties can help.

Learn more about the friendly folks from Perry Hood Properties today.