Manchester has little open land, but it has plenty of small lots: vacant parcels left after fires or demolitions, oversized side yards and teardown sites on the West Side, the East Side and the South End. Around the city, Hooksett, Goffstown, Auburn and Londonderry still have land for spec homes.
In short: LendingStreet finances ground-up construction of 1-8 unit investment properties in Manchester and nearby towns, including infill duplexes and fourplexes, spec homes, build-to-rent houses and small 5-8 unit buildings. Loans are sized on loan-to-cost with terms set per project, and funds are released through a draw schedule after inspections. Plans, permits, a complete budget and an experienced builder are what get a project approved.
Inside the city, investor construction is mostly infill: a duplex or a small multi-family on a lot that has city water and sewer, or a house with an accessory dwelling unit. In the surrounding towns, builders put up single-family spec homes and build-to-rent houses in small subdivisions, often on private wells and septic systems.
Many Manchester infill duplexes end up as long-term rentals, so a durable, efficient design with separate heating and utilities for each unit tends to serve both the refinance and the operating budget.
| Location | Typical project | Budget items to watch |
|---|---|---|
| Manchester infill lots | Duplex, triplex, fourplex, house with ADU | Demolition, utility connections, zoning relief |
| Hooksett, Goffstown, Auburn | Spec homes, build-to-rent singles | Ledge, wells, septic design |
| Londonderry, Bedford | Higher-end spec homes | Land cost, town review |
| Small multi-unit sites | 5-8 unit buildings | Fire sprinklers and code, parking |
New Hampshire is the Granite State for a reason. Many sites have ledge close to the surface, and blasting or hammering it out for a foundation can add real cost. Foundations must go below frost depth, and wet soils in parts of the Merrimack Valley can call for drainage work.
Get test pits or a geotechnical look before you buy land, and carry a site work contingency in your budget.
On city infill lots, the surprises are different: old foundations from a house that burned or was torn down decades ago, buried debris, and neighbors close on both sides. Plan for demolition, removal of old footings and careful staging on narrow lots, and talk with abutters early to avoid delays.
Outside city sewer areas, septic systems need state approval through the New Hampshire Department of Environmental Services, based on a design by a licensed designer and soil testing. Private wells in southern New Hampshire can have arsenic or radon in the water, so plan for testing and treatment.
Inside Manchester, connection fees and the cost of new water and sewer lines are the items to price carefully.
This example is illustrative and not a quote. An investor buys a vacant city lot for $95,000 and plans a side-by-side duplex with $520,000 in hard costs and $45,000 in soft costs, including plans, permits and utility connections. Total cost is $660,000. If the loan in this example is 80% of cost, it is $528,000, and the investor contributes $132,000. With staged draws over a 10-month build, the average balance might be about $290,400, for estimated interest of about $25,410.
When complete, each three-bedroom unit leases for $2,600, or $5,200 a month, and the duplex appraises at $760,000. A DSCR refinance of $528,000, about 69% of value, pays off the construction loan. Estimated principal and interest is about $3,602, and with taxes of $950 and insurance of $200, the payment is about $4,752 for a DSCR of about 1.09x.
| Item | Amount |
|---|---|
| Land | $95,000 |
| Hard costs | $520,000 |
| Soft costs | $45,000 |
| Total cost | $660,000 |
| Construction loan at 80% of cost (example) | $528,000 |
| Estimated interest during build | $25,410 |
| Completed value | $760,000 |
| DSCR after refinance | 1.09x |
New Hampshire's high property taxes apply to new buildings too, and a new duplex is assessed at its completed value. In the example, taxes are one of the largest monthly costs. Ask the assessor how new construction is picked up, and budget the full tax on completed value when you run the rental numbers.
Taxes in the surrounding towns differ from the city, sometimes by a lot, because each municipality sets its own figure. A spec home in one town and an identical home in the next can carry very different bills, which matters to buyers and to your DSCR math if you plan to hold.
New Hampshire law has required municipalities to allow accessory dwelling units with single-family homes since 2017, with local rules on size, parking and owner requirements. Some towns add their own conditions, and an owner-occupancy rule would rule out an investor ADU, so read the local ordinance before you plan one. Duplexes and multi-families depend on the zoning district, and some lots will need relief from the zoning board.
Funds are released after inspections at each stage: foundation, framing, rough mechanicals, insulation and drywall, and finish. Foundations and framing go best from spring through fall, and a project that is not closed in before winter may need heated enclosures. Our construction draw schedule calculator can help you plan stages.
Keep lien waivers from your general contractor and major subcontractors with each draw request, and make sure the work on site matches the budget line being drawn. Inspectors in the Manchester area will also note whether city or town inspections, such as framing and electrical, have been passed.
Projects without plans or permits, or a borrower with no build track record and no experienced general contractor, usually do not qualify. Land without septic approval, water or confirmed access is also hard to finance. Bring your builder's license, insurance and a list of completed homes.
A complete file includes stamped plans, a permit or a clear path to one, a line-item budget, a construction schedule, the contractor agreement and evidence of your equity for the project. For build-to-rent, include expected rents and the exit you plan.
Our investor loans are business-purpose loans on non-owner-occupied property. Send the lot, plans, budget, builder and exit, and we will outline the loan and draw plan. Call (877) 298-1001 or use the form below, and see our New Hampshire construction page for statewide details.
Yes, for 1-8 unit projects such as duplexes, fourplexes and houses with ADUs, with plans, permits and an experienced builder.
On loan-to-cost: the loan compared with land, hard costs and soft costs. The LTC and term are set per project.
It affects your budget. Blasting or hammering ledge can be costly, so test the site and include site work in total cost.
Yes, once the septic design is approved by the state and water is confirmed. Plan for well water testing.
Funds are released in stages after inspections, and interest is charged on what has been drawn.
Yes, once the property is complete and leased, if the rent covers the new payment.
Usually only with an experienced general contractor and a solid plan.
No, those are commercial. Our residential construction loans cover 1-8 units.
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