If you’ve been one of the fortunate real estate investors who found the perfect lot in an ideal neighborhood on which to build your next project, congratulations. You’ve likely hit the sweet spot when it comes to single family investing. An established neighborhood with replete with sought after single don't build the biggestfamily homes means your property will have plenty of looks when it’s ready to list.

Depending upon the size and nature of the area, it’s quite possible that due to the neighborhood’s attractiveness homes don’t change hands very often. And when you build brand new, you’re taking advantage of the neighborhood’s maturity while at the same time providing a home with all the latest building materials and sought-after amenities. So, how big do you want to build? Do you want the biggest house in the neighborhood?

Maybe not but you also don’t want the smallest one either. Instead, you should build a property that’s not quite the biggest home but is certainly in the largest quartile. The most expensive properties in a neighborhood will find their values lowered due to the simple fact that the recent sales in the area are for smaller homes. That can affect the future value of the home. On the other hand, larger home sales help smaller ones appreciate in value. Keep that in mind during the design process.

A neighborhood will always have a range of home prices from the least expensive to the most expensive. If you build the most expensive home, it’s possible the appraised value might come in lower than expected after a contract is offered because again the smaller home prices will pull down the appraised value. That can happen when a buyer offers $500,000 for the biggest home in the community and all the rest of the homes are selling at $475,000 and below.

Keep your real estate agent at hand when deciding how much home you really want to put together. Your agent will be able to tell you what you can expect to sell the home for and if the price per square foot begins to drop the bigger the house, you might want to reevaluate your plans.