Article by Shirley Martin, [email protected]

Photo by Anete Lusina, Pexels

Starting a custom property build can feel daunting, but it might be the best way to build the property portfolio you want. Follow this guide from ART-IS-ZEN architecture + engineering to learn the basics of why you might want to custom-build a property, what to consider, and what to know.

Why Do a Custom Build?

Whether you’re looking to start or expand your property portfolio, a custom build might be the best choice. Especially if you want to develop an investment property with multiple residences, a custom build could be the easiest choice.

While renovating an existing property is possible, it’s often time-consuming, stressful, and costly. Starting from the ground up could help create the property you envision at the lowest expense possible.

Keep in mind that a custom build doesn’t guarantee you a picture-perfect property with an exact completion date. The National Association of Home Builders says the average multifamily building takes 17.5 months to complete.

Being flexible is part of the experience, but being able to dial in every detail is priceless. Consider two years a more doable timeline, and resist the urge to rush the process.

Features to Consider

When it comes to features, property managers should consider what their renters or buyers are looking for. You might have preferences about home features, appliances, or finishes, but to get the highest return on your investment, you need to appeal to your target market.

Prospective homebuyers are looking for flexible space, but that doesn’t always mean more square footage. Adjust your floor plan to accommodate work-from-home, distance learning, extended family, and more.

Renters’ search habits trend toward pet policies, outdoor space, and walkable locations. Therefore, location and lot might be crucial if you hope to rent out your new build, especially to pet owners. It’s also worth your time to explore online listings to determine what sort of amenities landlords are offering their tenants.

Where to Build

Deciding where to build—and how—is an essential part of planning a custom property. A lot near amenities like grocery stores, gas stations, and entertainment is more valuable than a cheaper or larger property out of town.

The type of construction will also impact where and how you build; developing an apartment complex or condominium community is significantly different than constructing a single-family home.

Zoning and other requirements may also play a part in your decision-making process. For example, some areas may be zoned single-family only. Local rules may also limit apartment or condo building heights, requiring some creative development to fit multiple residences on one lot.

Who to Hire

Hiring a contractor is an obvious necessity, but a new build might require the help of other professionals, too. For example, you might work with an architect to design a property before hiring a contractor.

Later in the project, other specialists like plumbers, electricians, and roofers may join the team with your contractor or be hired separately. In the final stages, you might enlist the help of an interior designer or a home staging expert to help each residence look its best in listing photos.

Benefits of Forming an LLC

Forming an LLC (limited liability company) can provide several benefits for landlords. It offers personal liability protection, which means that any legal or financial issues that arise from the rental property will not affect the landlord’s personal assets. Additionally, an LLC can provide credibility to the rental property business, which can help attract renters and establish the company as a legitimate and professional venture. If you’re planning to start an LLC in Nevada, you’ll need to name a registered agent, create an operating agreement, and obtain an EIN.

Building a new property might be the best way to expand your portfolio. Whether you want to design single-family homes, construct apartment complexes, or something in between, controlling each element of the build ensures a property that fits your vision. Give special consideration to registering your business as an LLC to protect your personal assets.