Should I buy land to subdivide into a subdivision

Question

It seems it is prepared to be done that way.  It sold for $235,000 in 2012.  I hope it's ok for me to put this here:

8.36 acres

LOT/LAND$60,000  Gated paved road to wooded and scenic home site. In the area of other lovely homes. See drawing online. Call CSS for gate code.

$60,000

Gated paved road to wooded and scenic home site. In the area of other lovely homes. See drawing online. Call CSS for gate code.

Jay Hinrichs · Answer

@Diane Trotter  since you admit not being the least bit knowledgeable on subdividing. your chance of getting one of the crowdfunding sites  ( Realty shares , Realty mogul, patch of land) to sponsor you or this project is remote at best .. And frankly a total waste of your time.

I have done deals with these companies they look for only the very best and experienced in whatever it is they put on their sites..

Land development is an advanced skill set and it takes a bunch of up front money.. Takes years to develop yourself into a proficient RE developer .   Its not something most folks just try to do on their own. but if this is a small project and you want to learn it seems like its small money.. buy the dirt for 60k and go talk with a land planner and civil engineer.. get pre app meetings with whatever government agency in the jurisdiction controls land division.. it can be a good learning experience for you.. and being this is such a small amount of money it could be good practice and one to get started on.. don't do it though if you can't afford to lose the money.

I usually lose between 30 to 50k a year doing preliminary work on subdivisions that I end up not buying because you just don't know all the facts until you spend some money trying to engineer them and go through the process. ON one I walked from 80k...

But when things are going good its a big money business so its just the cost of doing business really is all it is.. and from what you described which is not much.. IE a piece of dirt for 60k then the risk is not much.. and maybe you want to give it a go.. just like I said make sure if and when you lose money on the deal it does not hurt you financially.

Karen Margrave · Answer

@Diane Trotter In answer to your question, no! I'm not trying to be harsh, but subdivisions aren't something you do if you are inexperienced, and no lender is going to consider gambling away their money with someone that doesn't know what they're doing. In looking at your profile I see that you have some impressive business experience, but development is in a world of its own.

Of course, some areas of the country are much easier than California, and it also depends on what you're referring to. Are you thinking of a simple split, or a full blown subdivision? The devil is in the details.

This is one of those situations where you don't know what you don't know, and it's an extensive list of things that come into play in subdivision development, and even for those with experience, it's a bear!

Here's a link to a series of posts I did a long time ago on development. Of course it doesn't cover your specific situation, but it may be helpful. Development 101

Brandon Moffitt · Answer

@Diane Trotter how many units on the multi-family purchase? And what price point? Feel free to direct message or email.

Brandon Moffitt · Answer

@Dianne Trotter make sure you learn the area before you jump. If it is truly SWLR (by Bass Pro), there are very few new residential developments in the area because there is no demand. Anything in that area is usually in the next county over (Saline County). Also, any development in Pulaski County outside of maybe a lot split, is going to require engineering to gain approval. Depending on where you are, you will most likely have to deal with two regulatory agencies: the closest city (e.g. Little Rock or North Little Rock) and Pulaski County.

Thomas Chapin · Answer

By the description in your first post you seem to be referring to two lots for sale on mls in an existing subdivision in west Pulaski.

Matthew Paul · Answer

In some areas 60K for 8 acres is a smokin deal , and in other areas 60K for a hundred acres is over priced  .  listen to the above advice

Karen Margrave · Answer

@Diane Trotter In order for others to help, we need all the information you have. In one of your later posts you mention there's a paved road, and gate. The question then is, is that paved road part of the subdivision land you are looking at or does it end at the gate? What do you know about the land, any work done (engineering, planning, etc.) If the paved road is part of the subdivision, then obviously there's some type of approved plan, what is it? (You need to go to the Planning Department and find out).

Steve S. · Answer

@Diane Trotter all comes down to your local government. Some are pretty cool about, others are fascist bastards. You got check and then and only then will you know.

Diane Trotter · Answer

Brandon, I certainly will.  It is good to know that you are in Little Rock.  I'm going to do some more research.  When I come to Little Rock at the end of June, I hope to meet you.

Thank you!

Diane Trotter · Answer

Ryland, I'm actually moving there.  I'm looking for a multifamily dwelling to purchase.  I ran across the land in my multifamily search.

Should I buy land to subdivide into a subdivision

8.36 acres

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