You’ve convinced yourself that now’s the time to build a new rental property from the ground up instead of finding an existing property to buy and rehab if needed. You’ve found the lot in the neighborhood that is perfect for your project so the next thing to do is to decide what to build. You can buybasic estimates existing floor plans off of the internet and perhaps even have yet another architect make any minor adjustments for you.

Or maybe you’d rather design a property on your own, with a little assistance of course from an architect who can help guide you through the tricky parts. Or you decided to design it 100 percent on your own and start fresh. Do you want to know one of the most common mistakes made by those who build new? It might surprise you but a large number of properties never get built because once the project is bid out, the investor discovers it’s way over budget and will never cash flow if financed and much less even sold for a profit. When considering building brand new, getting an accurate cost to build estimate is extremely important.

When evaluating an existing home that needs some repair, you can visit the property along with your contractor and property inspector. Your contractor will have a very good idea based upon previous work how much it will cost to replace the carpeting, install new kitchen cabinets and new interior paint. But a brand new structure requires everything to be included in the cost.

To help get a more accurate estimate to build new, have a basic set of preliminary plans drawn up by you with some basic off-the-shelf software or find a template that resembles what you have in mind. Now go talk to a few builders and ask them what they would charge to build a similar structure. You won’t get anyone to commit because your plans are still in the early stages, but you will be able to find out if the project is even feasible.