Luxury new construction loans fund spec homes and premium infill where finished value targets $900K–$2M+ — DuPage teardown-rebuilds competing with Plainfield new subdivisions, DC row pop-ups under HP review, and collar markets where custom finish is the product.
Standard new construction loans Chicago cover infill and three-flat rebuilds. Luxury new construction adds longer timelines, lower leverage, and listed-property exit planning when the buyer pool is narrow.
Apply: Newbuild form · Related: luxury bridge while listed · luxury fix and flip · DC new construction.
Luxury spec vs. standard infill
| Standard infill | Luxury spec | |
|---|---|---|
| All-in | $450K–$850K | $950K–$1.8M |
| ARV / list | $550K–$950K | $1.1M–$2.2M |
| Build time | 8–12 months | 12–18 months |
| LTV / LTC | Up to 90% | 80%–88% typical |
| DOM plan | 30–60 days post-CO | 60–120+ days |
| Exit B | DSCR hold | Listed cash-out bridge |
Milestone draw schedule (typical)
| Milestone | Draw % (illustrative) |
|---|---|
| Land / acquisition close | 20%–25% |
| Foundation + framing | 20%–25% |
| Mechanical rough-in | 15%–20% |
| Drywall + exterior | 15%–20% |
| Finish + CO | Balance |
Inspection at each gate — change orders documented before draw increase. Winter concrete schedules in Chicago add 30–45 days contingency.
Worked example: Naperville teardown-rebuild
| Item | Value |
|---|---|
| Land + demo | $385,000 |
| Hard + soft build | $620,000 |
| All-in | $1,005,000 |
| Target list | $1,225,000–$1,295,000 |
| Financing | 85% LTC · 10.25% IO · 14-month build |
| Carry post-CO | Plan luxury bridge if DOM exceeds 75 days |
Buyer compares to Plainfield new construction — finish and school district must justify premium. Naperville hard money hub · Luxury NC Naperville.
Worked example: DC row pop-up
| Item | Value |
|---|---|
| Acquisition (underbuilt row) | $720,000 |
| Vertical expansion + gut | $480,000 |
| All-in | $1,200,000 |
| ARV (supported) | $1,450,000–$1,550,000 |
| Timeline | 14–18 months with HP + DOB |
| Risk | HP material approval delays |
TOPA on occupied acquisitions extends start. See DC new construction · TOPA compliance guide.
Slow listing playbook — keep MLS active
Luxury spec DOM runs long — that is normal, not always a pricing failure.
| Day | Action |
|---|---|
| 60 | Review listed cash-out refi |
| 90 | Model bridge carry vs. price cut |
| 120 | Dual exit: sale or DSCR if rent supports |
Video: luxury cash-out while listed
File package
- Plans, specs, and budget with 10%–15% contingency
- GC contract or GMP with payment schedule
- Appraisal or supported as-completed value
- Insurance — builder’s risk + post-CO replacement cost
- Entity docs and proof of liquidity for interest reserve
- Exit plan — sale pro forma and bridge/refi path
Midwest expansion note
Chicago and Indianapolis remain value-add and BRRRR depth markets on standard programs. Luxury new construction concentration is collar and premium infill — Naperville luxury NC · Georgetown luxury NC — while Detroit and secondary Midwest metros expand on value-add hard money first (see tools/geo-seo-tracker/midwest-seo-phases.json).
When standard new construction is enough
Sub-$750K as-completed value, no listed-property carry planning, and no HP/overlay timeline — use new construction loans Chicago or new construction Washington DC on standard leverage and draw schedules. Luxury NC adds lower LTC, longer terms, and marketing/bridge exit documentation on narrow buyer pools.
Builder and inspector coordination
Luxury ground-up files require licensed GC, milestone inspections aligned to draw schedule, and 10%–15% contingency in the budget line — change orders without documentation do not increase holdback. Pair completion with luxury bridge DC or Chicago collar bridge when marketing starts before permanent takeout. Never promise DOM or appraisal outcomes — underwrite carry reserve for 90+ day marketing on $1M+ specs.
Terms (2026)
| Parameter | Range |
|---|---|
| Rate | 8.99%–13.5% IO |
| LTC | 80%–88% on qualified luxury ground-up |
| Term | 12–24 months (build + marketing) |
| Close | 14–21 business days with complete plans |
8.99%–13.5% IO on qualified luxury new construction · Newbuild apply · Submit scenario · (833) 264-7776
Rates, terms and conditions offered only to qualified borrowers and are subject to change without notice. All loans are subject to full underwriting. Jaken Finance Group only finances non-owner occupied investment properties.