When you’re ready to get into investing in real estate you might come across build to rent projects. These projects offer many benefits for investors and provide plenty of options, even for new investors. Before you choose to invest in any type of real estate project, it’s a good idea to know what you’re getting into.
Build to rent projects take the best aspects of single-family rentals and make them even better. They will provide a professionally managed community with many benefits. Let’s look at some of the benefits of build to rent projects.
1. Consistent Cash Flow
As an investor, you want cash flow from your properties. With build to rent projects, you gain consistent cash flow without depreciation. Build to rent projects don’t use the same conventional models for valuation. instead, they tend to be valued by the merits and the ability to achieve long-term income.
2. More Desirable Renters
One of the main reasons investors love build to rent projects are the renters they attract. Since these projects are usually single-family homes and managed by the same company throughout the entire community, they tend to attract more desirable renters.
The neighborhood model lends itself to families and couples. Build to rent projects also tend to be located in better areas with more desirable amenities and schools nearby.
3. More Amenities
While this might seem like a benefit only for tenants, it works for investors, too. When you invest in a regular home to rent out to tenants, you may not get any amenities with that home. Some communities offer some amenities, but you will be limited, in most cases.
However, with build to rent projects, you get built-in amenities, which can help to increase the marketability and the rent for the properties. Tenants will enjoy having amenities and they will understand why rent is higher compared to a similar rental without any amenities.
4. Absorption Rates are Faster
Unlike building homes to sell, build to rent properties tend to be faster with absorption rates. Since renting is much faster than buying, these projects will fill up faster, which is a good benefit for investors. You don’t have to wait to go to the closing table and you will know the community will fill up faster with tenants paying rent.
5. Renters Love New Homes
There is nothing better for good renters than a new home. They love finding a new home that is unlikely to have any type of issue in the near future. Renters don’t like making maintenance requests and as a landlord, you probably don’t like fulfilling them.
There are many benefits for tenants and investors for build to rent projects. When you choose the right one, it can be a great investment and your tenants will be thrilled to live in the community. If you’re considering investing in real estate, make sure to look closer at build to rent projects before you make your final decision.