New Hampshire has no income or sales tax, high property taxes and a tight housing supply. For investors, new rentals and spec homes in southern New Hampshire can work well, as long as the lender understands town-level approvals and septic rules.
In short: LendingStreet finances ground-up construction for real estate investors in New Hampshire on 1-8 unit residential projects, including spec homes, build-to-rent homes and infill duplexes, sized on loan-to-cost with funds released through inspected draws. The best lender for your build is the one whose LTC, draw speed, interest reserve and experience requirements fit your plans, budget and builder. In New Hampshire, also ask how the lender handles town-by-town permitting, septic approvals and the transfer tax paid by both buyer and seller.
Two New Hampshire construction offers can look similar on the first page and work very differently once the foundation is poured. Compare the structure of the loan, not just its price.
These are the items worth asking every lender about before you sign.
Also ask what the lender needs before the first draw, such as builder's risk insurance, a recorded deed and an approved budget, so nothing holds up the start of work.
| What to compare | Why it matters | What to ask |
|---|---|---|
| Loan-to-cost (LTC) | Sets how much cash you bring | What share of land, hard and soft costs is covered? |
| Land and equity | Owned land may count toward equity on some programs | How is land I already own treated? |
| Draw process | Slow draws stall subcontractors | Who inspects, and how fast are draws funded? |
| Septic approval | State approval needed on many lots | Is the septic design approved? |
| Interest reserve | Covers payments during the build | Is there a reserve, and how is it sized? |
| Experience rules | Decides whether you qualify | What track record or general contractor is required? |
| Term and extensions | Weather and permits cause delays | What happens if the build runs long? |
Investor building is concentrated in southern New Hampshire: Manchester, Nashua, Salem, Derry, Londonderry and Bedford, plus the Seacoast around Portsmouth, Dover and Rochester. Typical projects are single-family homes, duplexes and small multi-unit buildings.
Concord and the Lakes Region have smaller markets, and the White Mountains area has vacation rental demand. State law requires towns to allow at least one accessory dwelling unit with a single-family home, subject to local rules.
Southern New Hampshire's appeal is its proximity to the Boston job market and the absence of a state income or sales tax, which draws both renters and buyers from Massachusetts. That demand supports new rentals and spec homes in towns along the Route 3 and Interstate 93 corridors.
New Hampshire has a state building code, but enforcement is local and some smaller towns have limited inspection. Lenders use third-party inspections where needed.
Septic systems must be approved by the state environmental agency, and shoreland protection rules apply near lakes and rivers.
Ledge, rocky soils and wetlands are common, and site work can be expensive. Snow loads and deep frost affect design.
Energy efficiency matters because tenants pay heating bills, and many towns have specific rules on driveways, drainage and lot coverage.
This example is illustrative and not a quote. An investor plans a Londonderry spec home. Land costs $160,000, hard costs are $430,000 and soft costs, including plans, permits and fees, are $45,000, for a total of $635,000. At a sample 80% loan-to-cost, the loan is $508,000 and the investor brings $127,000.
If draws average about half the loan over a 9-month build, interest comes to about $20,000. If the finished home sells for $780,000 and selling costs run about 6%, or $46,800, the estimated profit before taxes and other carrying costs is about $78,200. A lower sale price or a longer build shrinks that margin quickly, which is why the budget and timeline matter.
| Item | Amount |
|---|---|
| Land | $160,000 |
| Hard costs | $430,000 |
| Soft costs (plans, permits, fees) | $45,000 |
| Total project cost | $635,000 |
| Loan at 80% LTC | $508,000 |
| Equity from investor | $127,000 |
| Estimated interest during build | About $20,000 |
| Sale price | $780,000 |
| Selling costs | $46,800 |
| Estimated profit | About $78,200 |
Construction funds are not handed over at closing. After the land is funded, the lender releases money in stages as work is completed and inspected, usually at milestones such as foundation, framing, dry-in, mechanicals and completion. Our draw schedule calculator shows how a budget breaks into draws.
Interest is usually charged only on the amount drawn. Some loans include an interest reserve, money set aside in the loan to cover monthly interest during the build, which protects your cash but raises the loan amount. New Hampshire's winter shortens the season, so foundations usually need to be in before the ground freezes.
New Hampshire charges a real estate transfer tax paid by both buyer and seller, so it hits both when you buy land and when you sell. Recording fees apply.
Property taxes are high compared with most states and vary by town. Check the town's rate before buying, because it drives holding costs and a rental's ratio.
Lenders look at three things: the plans, the budget and the people building it. Plans and permits show the project is approved, the budget shows it is priced correctly, and the builder's experience shows it can be finished.
Without plans or permits, or without either a build track record or an experienced general contractor, most projects will not qualify. Buildings of 9 or more units are commercial and covered on our commercial page.
Every construction loan ends with a sale or a refinance. For a sale, budget for selling costs and a cushion on price and time. For a refinance, confirm that the expected rent covers the new payment at the 1.0x standard minimum, using realistic taxes and insurance.
Our investor loans are business-purpose loans on non-owner-occupied property, and we review New Hampshire spec homes, build-to-rent homes and small infill buildings of up to eight units. Use the form below to get a quote, or call (877) 298-1001.
We will review the budget, confirm sizing on loan-to-cost and walk through the draw schedule before closing.
Both buyer and seller pay a share. It applies when you buy land and when you sell the finished home.
State law requires towns to allow at least one accessory dwelling unit with a single-family home, subject to local rules.
Yes, compared with most states, because there is no income or sales tax. Rates vary by town.
Lenders want a build track record or an experienced general contractor on the job. A borrower with no track record and no experienced contractor usually does not qualify.
Funds are released in draws after inspections confirm each stage of work. The land portion is usually funded at closing.
You either sell the property and pay off the loan, or refinance into a long-term DSCR rental loan that qualifies on the property's rent.
An LLC is standard and recommended for business-purpose loans. Expect to sign for the loan personally as well.
No. Our investor loans are business-purpose loans on non-owner-occupied property.
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