Last updated: December 2025
Quick answer
Experienced investors are using $3M–$10M renovation loans to acquire and upgrade luxury single-family residences (SFRs), capitalizing on rising demand for high-end homes. Private lenders offer flexible, fast financing based on after-repair value (ARV), enabling funding for major renovations with strong ROI potential.
Luxury real estate has always been a dynamic asset class, but in 2026, developers are finding even more opportunity in transforming high-end single-family homes (SFRs).
The right SFR opportunity with the right financing
Rather than building from the ground up, many investors are targeting existing luxury properties with untapped value, such as outdated estates, off-market deals, or underperforming assets in premium zip codes, and using $3M–$10M renovation loans to dramatically increase resale value or rental income.
With the right lender, a well-designed scope of work, and a clear exit plan, luxury renovation projects can deliver exceptional returns.
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Why the luxury SFR market is ripe for transformation
The luxury housing market in cities like Los Angeles, Miami, and San Francisco is shifting.
While demand remains strong, today’s buyers expect modern design, smart features, and turnkey convenience, something many older properties simply can’t offer.
That creates a window of opportunity for real estate investors who can:
- Identify high-potential properties in affluent areas
- Fund strategic renovations that align with market preferences
- Add value quickly through design and layout improvements
- Exit via resale, refinance, or short-term luxury rental
Broader price appreciation trends, captured in the Federal Reserve’s house price index, help support renovation-driven ARV growth in premium residential markets.
These aren’t cosmetic flips because many of these projects involve structural work, floorplan reconfiguration, or full interior/exterior overhauls. That requires serious capital, and that’s where private renovation loans come in.
What is a luxury renovation loan?
A renovation loan is short-term financing designed to cover both the acquisition cost and construction costs associated with a property upgrade.
For luxury SFRs, these loans typically range from $3 million to $10 million or more, and are often based on the property’s after-repair value (ARV).
Private lenders such as Marquee Funding Group specialize in financing for experienced developer business entities — LLCs and corporations with three or more completed projects—offering $750K–$5M+ loan structures designed for complex renovation and value‑add projects that fall outside traditional bank criteria.
Tighter residential and commercial lending standards, as reflected in the Federal Reserve’s Senior Loan Officer Survey, help explain why high-end renovation projects increasingly rely on private capital.
How private lenders structure $3M–$10M renovation loans
Private loans for luxury SFR renovations are customized to the borrower and the deal. Here’s a typical structure for these types of loans:
| Feature | Common Range/Terms |
| Loan amount | $3M–$10M+ |
| Term length | 12–18 months (with extensions possible) |
| Loan-to-cost (LTC) | 70%–85% |
| Loan-to-value (LTV) | Up to 70% of ARV |
| Interest rate | 9%–12% (interest-only) |
| Draw schedule | Based on verified progress |
| Points/fees | 1.5–3 points upfront |
| Interest reserve | Often included to cover monthly payments |
Private lenders evaluate these deals using a common-sense underwriting approach that focuses on the property, the renovation plan, and the borrower’s demonstrated ability to execute.
What lenders look for in a luxury renovation deal
Lenders like Marquee Funding Group look beyond just numbers. They evaluate:
1. Property location and upside
- Is the property in a high-demand, luxury neighborhood?
- Are there comps supporting the after-repair value?
2. Renovation scope and cost breakdown
- Is the project adding real market value (e.g., open floor plans, luxury kitchens, ADUs)?
- Is there a detailed construction budget and timeline?
3. Borrower experience
- Has the investor completed similar high-end rehabs?
- Is the contractor experienced with luxury projects?
4. Exit strategy
- Will the property be sold, refinanced, or converted into a short-term rental?
- Is there a backup plan in case the market shifts?
Case study: Turning a $5M teardown into a $9M masterpiece
An experienced investor in Beverly Hills identified a distressed $5M estate on a large lot, but traditional lenders wouldn’t fund it due to the property’s condition and the extensive renovation required.
Through a $7M private renovation loan, the investor was able to:
- Acquire the property with 30% down
- Finance $1.5M in structural upgrades, luxury finishes, and landscaping
- Complete the project in under 12 months
- Sell the property for $9.3M, netting a sizable profit
This type of deal is only possible with fast, asset-based financing that doesn’t rely on tax returns, W-2s, or perfect credit.
Why investors choose Marquee for high-end SFR renovations
Marquee Funding Group is a trusted partner for investors tackling luxury SFR upgrades. With in-house underwriting, local market knowledge, and decades of lending experience, Marquee offers:
- Same-day approvals and closings in as little as 5–7 business days
- Financing based on ARV, not just current value
- Interest reserves to cover payments during renovation
- Draw schedules tailored to your construction timeline
- Lending to experienced individuals, entities, trusts, and qualified retirement accounts
Whether you’re flipping, holding, or refinancing, Marquee delivers capital with the speed and structure investors need.
Tips for getting approved for a luxury renovation loan
To increase your chances of approval and a smooth funding process, prepare the following:
- Detailed scope of work (SOW) with budget and timelines
- Contractor estimates and credentials
- Recent sales comps that support ARV
- Photos or inspection reports of the current condition
- Exit plan with contingency options
If you’re short on experience, consider partnering with a licensed builder or project manager to strengthen your application.
Unlock the full potential of luxury SFR investments
Transforming outdated luxury properties into modern masterpieces takes vision and the right financing partner.
With Marquee Funding Group’s renovation loans, access the capital you need to move fast, take on ambitious projects, and create exceptional returns.
Planning a $3M–$10M renovation? If your LLC or corporation has completed 3+ projects, Marquee Funding Group offers fast, flexible financing based on ARV, not red tape.
Apply today and get funded in as little as 7 days.
Frequently asked questions: $3M–$10M renovation loans
Q: Can I use a private renovation loan for a luxury rental property?
A: Yes. Many investors use renovation loans to upgrade luxury SFRs for short- or long-term rental strategies, especially in vacation or high-income areas.
Q: How long do I have to complete the renovation?
A: Most loans offer 12–18-month terms, with extensions available. Timelines are customized based on the project’s scope and complexity.
Q: Do I need to own the property first to get financing?
A: No. Renovation loans can be used for purchase and rehab combined, allowing you to finance acquisition and construction in one loan.
Q: What happens if the renovation goes over budget?
A: It’s important to have contingency funds or equity to cover overruns. Marquee can also consider loan modifications if the project still makes financial sense.
Q: Can I refinance the loan after the renovation is complete?
A: Yes. Many investors refinance into a traditional mortgage or long-term rental loan after increasing the property’s value.