Greater Wilmington is one of North Carolina's fastest-growing coastal markets, with much of the new building happening across the river in Brunswick County. Coastal permits, flood design and insurance decide whether a project pencils.
In short: LendingStreet finances ground-up construction on 1-8 unit investment properties in the Wilmington area, with the loan sized on loan-to-cost and funds released through inspected draws. Typical projects include build-to-rent homes in Leland and Hampstead, spec homes in Brunswick County, and infill homes and duplexes near downtown Wilmington and UNCW. Our investor loans are business-purpose loans on non-owner-occupied property, and most projects exit by sale or a refinance into a DSCR loan.
In Wilmington, infill lots in the Northside, near the historic downtown, Carolina Heights and the areas around the University of North Carolina Wilmington can take new homes and duplexes. Monkey Junction and Ogden have newer neighborhoods, and the medical and film industries add renters.
Brunswick County, across the Cape Fear River, has seen some of the fastest growth in the state, especially around Leland, Winnabow and Southport. Pender County to the north, around Hampstead and Burgaw, is another common choice for build-to-rent and spec homes.
| Project type | Where it tends to fit | Local issues to check |
|---|---|---|
| Build-to-rent houses | Leland, Hampstead, Winnabow | Subdivision approvals, wetlands, utilities |
| Spec homes | Brunswick County, Ogden | Insurance cost, HOA rules |
| Infill single-family and duplex | Northside, near UNCW | Historic review, flood elevation |
North Carolina's Coastal Area Management Act requires CAMA permits for development in designated Areas of Environmental Concern, which include many waterfront and marsh-adjacent lots. Wilmington's Historic Preservation Commission reviews new construction in local historic districts downtown.
Wilmington, New Hanover County, Leland, Brunswick County and Pender County each run their own permitting and planning, and water and sewer service varies, with some outlying lots on septic. Confirm utilities before you buy.
Hurricane Florence caused major flooding across the region, including areas outside mapped flood zones. Wind-rated construction, elevated foundations where required and good drainage protect the finished rental and its insurance premium, which often decides the exit DSCR.
Ground-up loans are sized on loan-to-cost (LTC): the loan is a share of the total project cost, which includes land, hard construction costs and soft costs such as plans, engineering, permits and fees. The exact LTC and terms are set per project, based on the plans, the budget, the location and the builder's record.
The appraiser also estimates the completed value. A project where the finished value comfortably exceeds the total cost gives everyone room if the budget runs over or the market softens.
This example is illustrative and not a quote. An investor builds a 3-bedroom build-to-rent home in Leland. Land costs $75,000, the hard-cost budget is $290,000 and soft costs such as plans, permits, fees and builder's risk insurance are $30,000, for a total project cost of $395,000. If the project is sized at 80% of total cost, the construction loan is $316,000 and the investor brings $79,000 in cash or land equity.
At completion the property appraises at $460,000 and leases as one 3-bedroom, 2-bath home, for $2,700 a month. Because coastal insurance takes a big share of the rent, the investor plans the DSCR refinance at 65% LTV instead of the 75% maximum. That loan is $299,000, so the investor pays down about $17,000 of the $316,000 construction loan with cash and leaves more equity in the property. Estimated principal and interest on a 30-year loan is about $2,040; with taxes of $290 and insurance of $230 a month, the payment is about $2,560 and the DSCR is about 1.05x.
That clears the 1.0x standard minimum. Interest during construction and closing costs are not shown, and your numbers will differ.
| Item | Amount |
|---|---|
| Land | $75,000 |
| Hard costs | $290,000 |
| Soft costs | $30,000 |
| Total project cost | $395,000 |
| Construction loan at 80% LTC | $316,000 |
| Completed value | $460,000 |
| DSCR refinance at 65% LTV | $299,000 |
| Estimated principal and interest | $2,040 |
| Taxes and insurance | $520 |
| Monthly rent | $2,700 |
| DSCR | About 1.05x |
The loan is not handed over in one piece. After closing, construction funds are released through a draw schedule tied to milestones like foundation, framing, roof and windows, rough-ins and final completion. Each request is checked by an inspection before money goes out.
Subcontractors usually need to be paid before a draw lands, so keep working capital on hand. Map the timing with our construction draw schedule calculator.
North Carolina assesses at 100% of market value as of the county's last revaluation, and New Hanover County has revalued on a shorter cycle than many counties. Rentals get no homestead relief, and rates differ among Wilmington, Leland and the counties, so compare tax lines by location.
North Carolina's excise tax on deeds is generally a seller cost. Buyers pay title, recording and attorney fees on the land purchase and the DSCR refinance.
Gather these first. A borrower with no completed builds and no experienced general contractor, or a project with no plans or path to permits, usually does not qualify.
We finance business-purpose construction on non-owner-occupied 1-8 unit properties across New Hanover, Brunswick and Pender counties. Send the address, plans, budget, builder details and your exit plan, and we will review the LTC, the draw schedule and the completed value. For statewide context, see our North Carolina construction loans page. Call (877) 298-1001 or use the form below to get a quote.
A permit under North Carolina's Coastal Area Management Act for development in Areas of Environmental Concern, which include many waterfront and marsh-adjacent lots.
Yes. Single-family and 2-4 unit build-to-rent projects in Brunswick, New Hanover and Pender counties fit our program with plans, permits and an experienced builder.
Yes, with design approval from the Historic Preservation Commission. Budget extra time for that review.
At market value as of the last revaluation, with the new improvements added once complete. Use the completed value in your estimate.
Experience matters. A borrower with completed builds, or one working with an experienced licensed general contractor, is in a much stronger position. Projects with no build track record on the team usually do not qualify.
Most investors refinance the finished, leased property into a long-term DSCR loan that qualifies on rent, with no W-2s or tax returns. Seasoning rules vary by program.
No. Our investor loans are business-purpose loans on non-owner-occupied property. We do not finance a home you or your family will occupy.
Often soon after completion and lease-up, but seasoning rules for a DSCR refinance vary by program. Plan the timing with us before you start the build.
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