Smaller Properties May Make Better Development Choices

In the past when investors looked at residential property development opportunities it was with large residences in mind. This led to the creation of some spectacularly large homes that carried equally large price tags. Many individuals mortgaged themselves to the hilt and when the economy bottomed out they were left with unsellable properties that they could not afford to pay for.Recent trends in home buying however seem to be going in the opposite direction. While there are still individuals who are looking for large, high end homes the general trend among homeowners has been to downsize into smaller homes. There are several reasons for this trend.Why Buyers are looking for Smaller HomesThere are many reasons why buyers are looking at smaller properties than they have in the past. One is a change in lending practices. High risk mortgages where the borrower only pays for the interest are a thing of the past. This means that buyers are no longer able to afford the large and expensive properties that they have in the past.A second reason for a trend towards smaller homes is the cost of maintenance. The energy bills that come with a smaller home are usually much more reasonable than they would be with a larger home. Buyers may have less money to spend on home maintenance and utilities so they are looking for homes where these costs are lower. This is one reason why sales in condominiums have continued to do well in areas where the sales of conventional homes have declined sharply.The Environmental Footprint of a Home is also importantMany homeowners are looking at ways to minimize the environmental impact their home has. A smaller home generally carries with it a smaller carbon footprint. Because of this, smaller properties that are made using green construction materials and technology are still selling well when other properties may be struggling to attract buyers.How you can cash in on this trendThere are several ways that you can cash in on the smaller home trend. The first is to look at how a property can be developed into several smaller homes rather than a single, much larger residence. Choosing to construct condominiums or town homes may be a much sounder financial decision.If you are looking at purchasing an existing structure and refurbishing it in order to sell it at a profit, you may want to look at incorporating green technology in order to make it more appealing to buyers. While individuals who are searching for new homes are still interested in comfort and the use of quality materials and construction, they will be more likely to choose homes that are much more environmentally friendly. This is especially true if additions such as windows and doors will reduce the cost of heating or cooling a home.By working with a real estate agent and a reputable contractor you will be able to determine which homes will make the best development opportunities. A contractor will be able to advise you on the cost of any environmentally friendly changes or upgrades that you wish to add and the real estate agent will help you choose the best areas to build in or homes to renovate.

Comments are closed.