Utah County keeps building. From new subdivisions in Saratoga Springs, Eagle Mountain and Spanish Fork to infill lots in older Provo and Orem neighborhoods, investors are putting up spec homes, twin homes and small rental buildings.
In short: LendingStreet finances ground-up construction of 1-8 unit investment properties in Provo, Orem and across Utah County, including spec homes, build-to-rent twin homes and infill duplexes and fourplexes. 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 detailed budget and builder experience drive approval.
Most new construction is on the edges of the valley: Saratoga Springs and Eagle Mountain on the west side of Utah Lake, Lehi and American Fork in the north, and Spanish Fork, Salem, Payson and Santaquin in the south. Finished lots in approved subdivisions make spec homes and twin homes simpler to permit and finance.
Infill in Provo and Orem is smaller and more complicated. A tear-down lot near BYU or UVU may support a new duplex or fourplex if zoning allows, but neighbors, parking rules and occupancy limits all shape what you can build.
We look for projects that are ready to go: approved plans, a permit issued or close to it, a line-item budget and a builder who has completed similar homes. Projects without plans or permits, or a borrower with no build track record and no experienced general contractor, usually do not qualify.
Utah County cities charge impact fees for roads, parks, sewer and water, and many require pressurized irrigation (secondary water) connections or water rights for new homes. On a single lot, these soft costs can add a meaningful amount to the budget, and they vary widely from city to city.
Get the city's fee schedule and water requirements in writing before you finalize your budget. Underestimating soft costs is one of the most common reasons a construction budget runs short.
Construction loans are sized against total project cost: land, hard costs and soft costs. Terms are set per project based on your experience, the location and the exit plan. Land you already own can count toward your share of the cost.
Funds for each stage are released after an inspection confirms the work, using a draw schedule agreed at closing. Our construction draw schedule calculator can help you plan the timing of each draw.
This example is illustrative and not a quote. An investor buys a finished lot in Spanish Fork for $215,000 and plans a twin home (two attached units) with $455,000 in hard costs and $72,000 in soft costs, including impact fees and water. Total project cost is $742,000. Assuming the project is sized at 80% of cost for this example, the loan is $593,600.
Over a nine-month build with an average drawn balance of about $366,100, estimated interest-only carry is about $28,830. When finished, both units lease at $2,400. If the property appraises at $860,000, a 70% DSCR refinance of $602,000 carries estimated principal and interest of about $4,209; with taxes of $330 and insurance of $150, DSCR is about 1.02x. The refinance pays off the construction loan, with little room to spare, which is typical for new rentals in Utah County.
| Draw stage | Share of hard costs | Amount released |
|---|---|---|
| Foundation and footings | 15% | $68,250 |
| Framing, roof and windows | 30% | $136,500 |
| Rough mechanicals | 15% | $68,250 |
| Insulation, drywall and finishes | 25% | $113,750 |
| Final inspection and occupancy | 15% | $68,250 |
Twin homes, where two units share a wall but sit on separate or shared lots, are common in Utah County subdivisions and work well as rentals. Check whether the plat creates one lot or two, because that affects whether you finance them together or separately and how you might sell one later.
HOA rules matter in newer communities. Some restrict leasing or require minimum lease terms, which can limit a build-to-rent plan. Read the covenants before you buy the lot.
Compare your all-in cost per unit with what existing twin homes and duplexes sell for nearby. New construction leases at a premium to older stock, with modern layouts, garages and lower maintenance, but the premium has to cover the higher cost for the rental math to hold up.
Utah County builders can work most of the year, but winter storms slow foundation and exterior work, especially on the benches. Some areas near Utah Lake have soft or wet soils that require engineered foundations, and the region's earthquake risk is built into Utah's building code. Ask your engineer and builder about soils early; a geotechnical report can change the foundation budget.
Spec homes are usually sold, and the loan is repaid at closing. A build-to-rent home or twin home can move into a DSCR loan once it has a certificate of occupancy and signed leases. Because Utah County prices are high relative to rents, plan the refinance leverage carefully; the example above uses 70% for that reason.
Send LendingStreet your plans, budget, builder information and lot details. We will review the project, explain how it would be sized and walk you through draws. Statewide information is on our Utah construction loans page.
If you are still choosing a lot, call before you buy. We can tell you what the project would need to be fundable, which often shapes the lot you choose, the plan you build and the builder you hire. A complete package with plans, permit status, fee estimates and a signed builder contract gets the fastest review.
Yes. We finance ground-up spec and build-to-rent projects on 1-8 unit investment properties across Utah County.
On loan-to-cost: land, hard costs and soft costs, with terms set per project. Your experience, the location and the exit plan all affect leverage.
Yes. Impact fees and water requirements are soft costs, and they belong in your total project cost from the start. They vary a lot between Utah County cities, so get the current schedule from the city.
Through a draw schedule agreed at closing. Each stage is inspected before funds for it are released, so plan to pay subcontractors on that rhythm.
Yes, if zoning and the HOA allow rentals. Confirm whether the plat creates one lot or two, since that affects financing and any later sale of one side.
It helps a great deal. A borrower without a track record usually needs an experienced general contractor to qualify.
Yes, once it has a certificate of occupancy and leases. Plan leverage carefully given Utah County rent-to-price ratios.
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