Subdivision, and adding land to a house to increase value?

[Randall Everett]

Hi Everyone,

I'm a new investor/BP member. I live on a motocross track that I built for my training business. A family member and I acquired this property (140 acres) as a HUD home a couple years back and it came with a 200+ year old home on it. Price of the property $330k. I live in the home and it's actually a duplex. Pretty nice place actually (It's been renovated at some point.)

I have a plan but would like to see if anyone had some input on this plan. I've found this plan constantly rearranging because of my county's regs and what I'm allowed to do. Land conservation is a priority in this county.

#1 - I want to subdivide the house out of the large parcel for liability reasons on the motocross track and to refinance and pull money out to invest into the following steps. The requirement is 10 acres in my county and I can only subdivide once. 

#2 - There is a 2.5 acre lot with ANOTHER duplex on it owned by an investor. It's literally sitting right in the middle of my property. We want to buy this and then ADD some of our land to it. Would adding 5-10 acres raise the value in this property? My initial thought is to add 10 acres and see a nice increase in value but I'm sure its not that cut n' dry. Regardless, We want to buy this property because it is, or could be a little bit of a nuisance to any plans we have with this large parcel.

#3 - While we can only subdivide ONCE, We are also allowed to gift. We will gift two parcels to immediate family members, build a house on each and keep them as rentals. After 5 years we can do whatever we want with them. How much acreage, or better yet how could I find out what the magic number for acreage would be to get the most value?

I'd like to make a couple final points. My plan is to give as much UNUSABLE land to the two duplexes since they are rentals. The other is that my area is expanding. In 5 years it will be developed in this area. A major subdivision has crossed my mind but my county requires a VDOT approved paved road. If they were to let gravel roads fly like surrounding counties I would already be looking into it but I don't think a major sub would be worth much yet. Sorry for the long post - I appreciate any of advice! I attached a picture showing the property as it sits, and one with my proposed plans.