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100% does not happen all the time. In fact, in most cases, a good return % is much lower.
Never heard of it but I’ll go in on it with you if you get more info. I’ve been looking in the DFW area for awhile
What is considered a good return for new builds in Dallas? I see new builds in my area for sale for $2-3M. Lots for sale is $700k and then build 4k sq ft. Let’s say $650k the build and $100k holding costs. So all in they are in it for $1.45M. Are they making around $400-500k each? Seems just ok for such a long period from start to finish
Yeah that’s about the price for a new construction home in my area. They are bigger though between 4-6k sq ft. They don’t usually make smaller home bc they make more by adding as much sq ft as possible
Coach
There is a reason returns are high but 100% in two years would be rare and probably dependent on your ability to pay cash or have amazingly cheap financing for the project. As a private banker I’ve financed these deals before, usually to a partnership made up of a builder and a wealthy person putting up the cash or guaranteeing the loan. I’ve seen plenty of folks lose money or struggle to break even. Delays, increases in building costs, getting less rent or sale price when you are done, fluctuating rates if the loan is variable - lots of ways this goes sideways. Not including partnership issues and squabbles. It’s a thing, but it’s more like a full time gig or part time side hustle. Not easy passive income. And you want a very experienced builder as a partner. Or be prepared to learn some lessons the hard way over time and not necessarily hit a home run your first few projects.