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What Is Raw Land Development?

  • Purchasing Raw Land can be very beneficial as an investment whether you are holding for Appreciation, Developing or Building


  • Raw land development is the process of purchasing a parcel of land with the intent of either developing and building on it, or holding onto it for long-term appreciation


  • Raw land investing has a wealth of opportunities, but will essentially provide returns from Developing, Building & Selling activities

How To Develop Land In 7 Steps

  • Evaluate Its Economic Feasibility
  • Find Out What The land Is Zoned For
  • Determine The Price
  • Secure Your financing
  • Planning Your Build
  • Begin Building Within Zoning Laws
  • Market The Land/Property/Units For Sale

Top 5 Benefits Of Developing Land

  • Raw land can be less competitive than residential real estate
  • Purchase price and holding costs are lower with raw land
  • The appreciation potential can remain high even with less than stellar market conditions
  • There are countless development opportunities for raw land
  • Sellers of raw land are more likely to offer a Vendor Take Back Mortgage (where the seller holds a portion of the purchase price as a mortgage to help close the sale)

5 Tips For Land Development

Land Development is not for the weak. The process can require extensive time and research, especially when compared to a traditional residential investment. However the right preparation will make a raw land investment well worth it


Learn To Calculate Holding Costs

  • Building and zoning permits take time, it may be a while before your land is ready to develop. Make sure you are prepared by accurately calculating the holding costs associated with land, particularly when it comes to interest


Keep Your Ear To The Market

  • Complete a market analysis before entering a land deal and continue to watch during the process. It is a good idea to pay attention to other land development projects in the area. By doing this you can accurately project time frames and windows of opportunity


Understand The Potential Risks

  • The only way to mitigate potential risks is to do as much research as you can. That way you are prepared for any obstacles you do encounter


Watch Out For Time Consuming Zoning Issues

  • Depending on what you plan for the property, rezoning may be required. This requires a good amount of paperwork and in most cases, time. The best way to avoid as much of the limbo stage as possible is to plan out what you want to do with the property before you actually purchase it. This will allow you to make an informed decision either to commit to the zoning process, or move on to another property


Choose The Right Professionals

  • When it comes to land development projects it is crucial that you have a reliable, skilled set of professionals to help see your project to fruition. This is anyone from construction workers to contractors to project managers. Raw land development requires the right team, so make sure yours is as good as it can be by consulting your Citadel Mortgages, Mortgage Agent

Important Factors In Land Development

When it comes to land development, investors are essentially purchasing land, building new construction, and renting or selling the final product. The complexity of this deal type will demand a significant amount of planning from investors, before they ever even purchase the property


Permits

  • Permits are required for almost any type of construction, development or renovation. When developing land it is crucial to research not only the permits required for these projects, but also the anticipated costs and timelines of obtaining them. Many underestimate the amount of time permitting can take, and should account for it


Zoning

  • Depending on where the land is located will determine the zoning, whether that is Commercial, Mixed-Use or Residential. In some cases, land can be rezoned, it is important to add that into your timeline. It's also important to note whether any potential lands are located within a protected green belts, area with building restrictions, etc.


Municipality

  • Ensure you are up to date on Municipal fees and levy's. These can be costly from building fee to drainage catch basins, etc. These are often regulated by the city or municipality in which the area is located, and could impact your plans. Do not simply rely on others (such as your builders and contractors) to keep you up to date on there as well as abide by building codes, familiarize yourself with them as well to be sure any project is planned properly


Servicing

  • Water, sewage and electricity are three of the most important aspects when planning land development. You should determine if there are existing hook ups or water and sewage lines or electricity on the property and go from there. It is crucial that you research local requirements during this part of the process, as there are a number of regulations around installing and operating these services

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Est 2018

Changing The Way Mortgages Are Done