Ground-Up Construction in Missouri

Not automatically as a homesite. RSMo 137.016.5 classifies vacant land by its immediate most suitable economic use, weighed across eight factors including prior use, location, zoning, legal restrictions, utilities, size and access. A raw lot you have not touched yet is not presumed residential just because a house is coming. Budget the carry on whatever classification the assessor assigns today, not the classification your finished build will earn.

On a fixed, statewide calendar, not the day you get your certificate of occupancy. Missouri reassesses biennially in odd-numbered years under RSMo 137.115, and new construction is valued as though it had been completed as of January 1 of the preceding odd-numbered year. A build finished in 2026 is picked up at the 2027 valuation date. That gap is a real, plannable window for carry-cost modeling, and it applies the same way whether you are building to sell or building to hold with a DSCR rental loan behind it.

Yes, and the rule cuts in your favor if the assessor skips a step. Before Missouri raises a subclass 1 parcel's assessed value by more than 15 percent since the last assessment, excluding new construction itself, RSMo 137.115.10 requires a physical inspection, with written notice of the owner's rights and at least 30 days to request an interior look. A drive-by does not count. The State Tax Commission has held these steps mandatory, not discretionary, and where the assessor skips them the property owner prevails as a matter of law. Keep the notice paperwork on any Missouri build that moves value sharply.

No. RSMo 137.115.5 puts residential property, subclass (1), at a 19 percent assessment ratio with no unit-count cutoff, so a duplex, a fourplex or a small walk-up you build to hold all land in the same subclass as a single-family house, well short of the 32 percent ratio subclass (3) carries. That gap is worth building into the pro forma on any build-to-rent portfolio before you finalize unit count.

Builder's risk is standard, and Missouri's distinctive tail is seismic, not wind. The state's Department of Commerce and Insurance reports New Madrid-area earthquake take-up at 10.4 percent in 2024, down from 18.3 percent in 2015, with fewer than 20 percent of residences covered in 101 of the state's 115 counties. A standard landlord or builder's risk policy does not include earthquake coverage by default. Quote the specific site and ask about it directly, especially in southeast Missouri.

We did not locate one, and we are not going to state a number we have not verified. The state-law research behind this page found no statewide permit or impact fee schedule to quote, which is not the same as proving none exists. Get the current fee schedule from the city or county where you are building before you finalize a construction budget.

We fund new construction up to 70% of value and up to 85% of total cost (land plus build), in most states, on loans up to $5M. Experienced builders reach the higher end of leverage. We finance both the lot and the vertical construction within those caps.

Yes. Lot acquisition is funded as part of your loan-to-cost. If you already own the lot, that equity can serve as your down payment, which often lets us fund most or all of the build cost.

Construction funds are released in draws as milestones are completed and verified, not handed over at closing. You submit your budget and scope of work up front, complete a phase, request a draw, and we release that portion after inspection. You pay interest on funds as they are drawn.

Our construction pricing starts around 10%, interest-only, on terms of 12 to 24 months. Market ground-up rates generally run 9% to 12% with 1 to 3 points. Your pricing and leverage depend on your build experience and the strength of the project.

We consider builders at all levels, though a track record helps your leverage and rate. A first-time builder should expect to bring a strong general contractor, a detailed budget, and typically a larger equity contribution. A well-documented project goes a long way.

The lot cost or current value, your construction budget and scope of work, the projected after-built value, and your build experience. With those we can size the loan against both cost and completed value and send you terms.