IDEAS TO FIND VACANT PARCELS?

Question

We are developers/contractors in Orange County, CA. We want to find vacant parcels of land on which to build homes. Unfortunately, there are only a few listings of land on MLS, for a few reasons. 1 Most areas are already developed out and 2 Anyone with land probably doesn't think there's a market for spec houses so aren't pursuing actively listing.

We moved to So Cal from northern CA where we knew every parcel of ground in the city we lived. Down here, the area is far to vast to do that.

Does anyone have any ideas on finding vacant parcels? I've tried having the title company pull vacant parcels, but it ends up having every teeny piece that is used for medians on roads, etc. Any ideas?

Chris Feltus · Answer

Karen M.

Thats a great question. I used to work as an analyst for a land developer, perhaps my experience will be help generate some ideas for you. I am very data driven I enjoy querying databases and producing maps from the results, this question is my forte. I put together this quick guide hopefully you will find it of some use. 
Please note the illustration for the steps below.

1. Download the database from your local Central Appraisal District or Tax Assessor. Make sure to differentiate how your county delineates between vacant commercial or residential zoned land, depending on your needs. Most counties provide metadata (basically basic information on how to interpret the database, how the data was obtained etc) from the same location you downloaded the database. If there is no metadata provided, contact the admin for the database they are usually willing to help. Its also worth noting some databases are updated more frequently than others, in my case Tarrant county updates their database once a month.

2. Query the data. In my case, vacant tracts are listed as C6 in the state use code inside the database. Once you know what to look for you can perform a simple query or filter on the database to show only vacant parcels. This step does not require advance computer knowledge.

3. Once you have queried the data and have the results desired, you can create a map of the database. This step requires more advance computer knowledge. For instance, in the image below red parcels are color coded for vacant, yellow is developed.

Illustration for aforementioned steps

Seth Williams · Answer

Vacant land parcels are actually very easy to find - in fact, that's almost exclusively what I deal with on a weekly basis. I don't do a ton of business in CA these days, but I do in many other areas of the country.

My method isn't a quick explanation per se, but it isn't difficult either. If I have the time - I'll work on creating a blog post in the next week or so explaining how I work my process. It's easy to target any particular county in the U.S.  I think you'll find it to be a lot simpler than it seems.

Account Closed · Answer

Karen:  When I started, my first deals in CA were vacant land (tax sales), and I've done some several regular vacant land deals.  All of them have been very profitable and easy (compared to SFH deals).  So, I am intrigued by your challenge to find an affordable build-able lot in Orange County.  I ran some quick data tests using my title company accounts.  First for just the cities of Irvine and Costa Mesa, then for the entire county.   As you mentioned, the title company searches will show plenty of vacant lots that are under 2500 square feet and that aren't buildable. Most are leftover parcels from previous development.  One of my tests showed 500 vacant parcels , but less than 25 parcels that were buildable and/or owned by individuals as opposed to owned by munis or developments/hoas.

The title companies can pull info for lots that are over a certain size (square footage or acreage).  So if you were to request vacant parcels over a certain size (say 2500 sq ft or 5000 sq ft) you'd eliminate a huge percentage that are useless to you.  The other thing that is useful is assessed value.  It's the rare use-able lot in Orange County that will have an assessed value under $5 or $10K.  Hundreds of lots that might not have square footage info do have assessed value info.  You could probably safely eliminate all lots under certain assessed values. None of these searches are perfect. Plenty of vacant parcels are adjacent to and have combined use with an SHF parcel with an owner occupant.  Many owners have several small adjuacent parcels that when combined would make a buildable parcel.  So, it's more of an art than a science.  :)

All this to say that you can go back to the title company and refine your searches and see if you gets you something you can more easily work with.

Account Closed · Answer

Karen:  I'm not sure about your assessment of owners not knowing that there is a  market for vacant parcels.  In any area of So Cal with higher valued props and already built out, any vacant parcels are vacant for a reason.  It's not like the owners don't repeatedly hear from buyers and developers, trust me. If you're talking Anaheim, maybe.  Any remaining potentially buildable lots in the coastal cities have challenges.  They aren't really buildable (or it would cost too much to meet all the code demands) or they have title challenges, or both.  Not that you can't create something out of a challenge, but many developers and builders with mondo marketing and legal resources have come before you.

Tell me what city you are interested in (pick one!) and I can pull some data from my sources and we can brainstorm on potentially motivated sellers.

NA Foster · Answer

Try having Title Company search your areas for all SFR, not just vacant lots, up to the assessed value that will work for you.  You might get something that you can demo to get the lot.  Also check the local fire dept headquarters for a list of  fires that you might get the remains to demo for the lot.

Karen Margrave · Answer

Thanks to all of you for the thought and time given to your replies. Seth Williams I look forward to reading your blog!

Karen Margrave · Answer

Chris F. Thank you for taking the time to give me such a detailed explanation. I definitely will try this. We'd actually prefer commercial if we can find the right lot.

K. Marie Poe I know that it's a challenge to find vacant parcels, but there are some out there, that for some reason or other are buildable and vacant, though they are rare. There are some for really high end houses, but that's not what we're looking for. We are finishing a house on such a parcel right now in Lake Forest, the original house had burned down.

I've looked at everything on the market in Huntington Beach, Costa Mesa, Newport Beach, Irvine, Dana Pt. Lake Forest, Laguna Hills, Laguna Woods, Mission Viejo, Aliso Viejo, San Juan Capistrano, San Clemente, and Orange. I know there are some lots in those areas where old stuff has been torn down, I just need to get out and find them!

I can probably find some in other cities, but these are the ones that we are most familiar with, though I can get up to speed with others quickly. Laguna Beach is a definite no, as they take up to 18 mos to get permits if you're lucky!

Steve Babiak · Answer

Maybe not so advanced knowledge will be needed, if this next post's ideas are put to use.
http://www.biggerpockets.com/forums/80/topics/71902-rental-rate-maps-how-to-learn-rental-rates-in-your-city?page=1#p410700

Mike Nelson · Answer

Chris F. I love playing around with data as well, you're able to find jems when sorting data dealing with properties.

Steve Babiak · Answer

Often, those who own vacant parcels are tired of paying the real estate taxes on that non-performing property, to the point where they are up for tax sale.  Depending on how your local area handles delinquent taxes will determine how to go about finding these.  In my state, it is a tax deed state, so there are annual tax sales (and sometimes delinquent liens on vacant parcels go to sheriff sales that are held more frequently) where you end up getting a deed.

IDEAS TO FIND VACANT PARCELS?

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