All Forum Posts by: John H Huston

Megan,  Greetings!  There are a whole host of factors that go into the determination of whether a particular piece of land is good to build on, including existing zoning and land use designation in any master plan, restrictive covenants of record, potential for rezoning and use, access (including curb-cut), slope, soils, drainage, flood risk, historical use (pristine or a dump or former manufacturing site), and availability of services (water, sewer, power, telephone, cable, internet, garbage, etc.)   The local municipal/county building department can be of help in terms of present and potential zoning and use.  Depending on the context, it might be wise to obtain and Phase I Environmental Report from a local qualified  engineering firm that does such investigations and reports.  Some lenders require one to be done in any event.  Often, the same engineering firm is also familiar with the area and can advise you on soils, slope, drainage and geotechnical aspects, such a sinkhole risk.  Determination of availability and cost of services may involve contacting each provider and finding out what services are available and their cost (such as tap fees for water & sewer.)   It would be important to talk with the city or county about access, roads and who pays for the cost of the improvements, extensions and future maintenance you will need.   It might be helpful to talk to a couple of local builders and see what their experience and advice is.  If you really like the land you should think about tying it up on an option first before exposing it to lots of folks in your investigations - people who might become interested themselves or mention the property to someone else. Generally, you should be able to option the land for a nominal amount of earnest money paid  into escrow for a reasonable diligence period while you gather information, the option money returnable to you if you find out something you do not like, including any defects in title that show up on the preliminary title report (usually delivered to a buyer for the buyer's review after entry into the option or purchase agreement and prior to the earnest money becoming non-refundable to the buyer.)   Good luck. Best,  John

Christopher,  I do not know whether there would be a permit problem in your jurisdiction.  Best to ask the city/county official responsible for building and remodeling permits - hopefully without disclosing your target property.   In Clark County, NV, it would be a problem.  I had a similar issue with a property I was interested to buy.  I went to the building department and told the story, and received help with the permits that should have been obtained before the work was done.  I was allowed to apply for the permits needed and pay the inspection fees.  The building inspector came out to the house and inspected and signed-off, and the necessary permits were issued and completed.  But, I was warned by the building inspector that, in some cases, the inspector will not approve work previously done without a permit, especially if he/she cannot reasonably see or ascertain how the unpermitted work was done.  In such a case, I am told that the inspector will determine and write down what needs to be done in terms of removal (partial or all) of the improvement for which there was not issued a permit, before the inspector can say what the permitting path forward will be.   As I say, that may not be the system in your jurisdiction.  Even if your jurisdiction does not require anything - or if the improvements predate the requirement for permits and is "grandfathered" - for myself, I would have an expert inspect the property and the improvements for problems or defects.  If I really liked the deal, I would probably option the property and then get the inspections done before proceeding, with the return of any option money being at my sole discretion if I decided against the acquisition.  Good luck.  Best, John. 

Welcome.  I am not a house flipper, but when I started out in vacant land and water rights, I looked first for opportunities in areas close to home that I already knew something about.  Then, I tried to find people who were already active in those areas.  Few of those wanted to help me, but a couple of them did, for whom I will always be thankful.  I would not be in any rush to find the first deal to commit to.  Also, just like moving to a new school when you were a kid, the friendliest kids on the playground may be that way because they have burned their bridges with everyone else in the class.  So, always get the background on anyone whose advice or opinion on a property whose opinion you are inclined to trust - before you trust.  Some people say you need to find the money before looking for a deal.  That is kinda working in the blind for me.  I always found it easier to find the deal and then work on the funding - talking to friends, banks and potential investors.  I always had the property tied up on refundable option first.  When I started out, I lost a lot of what I thought were deals when I could not find the money.  Usually, when I could not find the money, it turned out there was a good reason I had not considered.  Maybe you can do better concentrating on the money first.  I suppose that if I had more talent, I could talk the specific property and the money at the same time.  Maybe you can find a way to do that. Good luck.  Best, John

Congratulations!  Mine too, although it was some time ago.  Good luck!  Best,  John

What kind of RE are you looking for to increase your portfolio?

Mark,

Good question. Not as a legal opinion or legal advice, but in my own case, I use a separate LLC for each property I buy and try to isolate any potential liability - such a slip and fall or whatever, even with liability insurance as limits can be exceeded in a bad case - from the others properties. Then, you might consider the family trust holding the beneficial interest in the LLCs. In most states, I notice that there are no annual fees payable to the state for creation or maintenance of a family trust. In all states I have done business in, LLCs are required to pay an annual fee and file an annual statement of managers. So, there is an annual cost of each and every LLC. Good luck. Best, John

Melissa,

I firmly believe that one must see the property and the area first hand.  Walk all four corners.  Look in every closet.  Also, it is often productive to see which real estate agent has the most listings in the neighborhood - who "farms" the neighborhood - and talk with that person.  You might be able to discover who that agent is by looking at local listings online and have a chat before committing to a trip there.  Be careful not to commit yourself to using or involving that agent - unless you decide you want a buyers agent/broker. Usually in a transition area, on the phone, you should be able to get to the person at the city/county who handles issuance of permits for building and remodeling can tell you a bunch about activity in a neighborhood.  Good luck.

Best,

John

Welcome.  As you begin and learn, keep land in the back of your mind.  It may be a little more of a specialty, but vacant land comes many sizes - small lots all the way up to big farms and ranches. You can start small and build.  Usually the real estate taxes are small, with no roofs to leak or plumbing to clog, so land can be handled without a significant cost - whether time, dollars or maintenance.  

 621 are 1/2-acre, 155 are 1.1-acre and 99 are 2.5-acre lots. 150 miles north of Las Vegas.  $1.75M.  Water rights included.  Roads and electric are to subdivision.  Pavement near.  Great solar potential.  All must be sold in a single transaction to investor, developer, builder or retailer only.  I would consider providing financing.  

I have the perfect private property for development and operation of a new off-road (ATV, UTV, Dirt Bike, 4-Wheel, Mtn Bike,  Horse, Hiking) destination resort.  Looking for financial partner in $4M range.   98% of the county is federal lands and has hundreds and hundreds of miles of trails.  International Mtn Biking organization building new trail new work.  Canyon/mountain terrain near enough to Las Vegas and CA market.