Criteria for Good Land Development

[Landon Dolezal]

Hey BP so I'm trying to create a good deal for a contractor who builds new construction SFH. I'm only 20 so I'm trying to show that I can bring him good deals and know how to put my numbers together. But I've never looked into new construction niche. So my question is what all do I need to take into account when showing him the deal and then how does referral fees work like that. do I just ask for a small percentage of his project? He's a neighbor to friends house and I've worked with a couple times so I know him quite well and don't want to come off rude. Thanks everybody and appreciate your feedback.

[Ryland Taniguchi]

Originally posted by @Landon Dolezal:

Hey BP so I'm trying to create a good deal for a contractor who builds new construction SFH. I'm only 20 so I'm trying to show that I can bring him good deals and know how to put my numbers together. But I've never looked into new construction niche. So my question is what all do I need to take into account when showing him the deal and then how does referral fees work like that. do I just ask for a small percentage of his project? He's a neighbor to friends house and I've worked with a couple times so I know him quite well and don't want to come off rude. Thanks everybody and appreciate your feedback.

Land development is pretty complicated. Here in Seattle, you'll have interest if a lot can be developed where the finished lots are priced at 20% of the finished value of the homes to be built. The market here is usually closer to 30% to 35% of the finished value of the homes. Banks right now won't touch any horizontal financing. However, you can get horizontal financing from private lenders and then refinance with bank financing when you get permits completed.

Here are some checklist items you'll need to analyze to know if it's a good deal.

• Location
• Zoning
• Topography
• Soil
• CC&Rs
• Utilities
• Environmental Issues
• Ingress and Egress
• Curb, Gutter and Sidewalk
• Setbacks
• Landscaping
• Parking
• Fire Sprinklers

Best way to start is to get a zoning map for your area and get to know the zoning. Research new construction and figure out what they are paying per square foot for the building.