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Land Development

Land Development

 

Investing in Vacant Land for Development: The Pros & Cons

There is a lot of land out there just waiting to be developed. Whether you are looking to invest in land for residential or commercial development, it can be a great way to make money. However, there are pros and cons to consider before investing in land. In this blog post, we will look at the pros and cons of land development, as well as some tips on how to find vacant land.

  • The Pros of Investing in Land for Development

    - Land is a finite resource, so its value is likely to increase over time.

    - There is a lot of vacant land available for development, so it can be easy to find a property that meets your needs.

    - Developing real estate in rural areas may be a highly profitable business, especially if the property is prime.

    - Land can be used for a variety of purposes, including residential, commercial, and industrial development.

  • The Cons of Investing in Land for Development

    - Development can take time and money, so it may not be ideal for short-term investments.

    - There's always the chance that the property won't be developed as planned or may not be developed at all. This can lead to a loss of investment.

    - Development is often subject to zoning laws and regulations, so it's important to do your research before investing in land.

  • So, should you invest in land for development? It depends on your specific needs and goals. If you're looking for a long-term investment with the potential for high returns, land development may be a good option for you. However, it's important to do your research and understand the risks involved before making any decisions.

  • Tips for Investing in Land for Development

    - Do your research! Make sure you know what the zoning laws are for the area where you want to purchase land. This will help you determine whether the land can be developed for your desired purpose.

    - Look for vacant land that is close to urban areas. This will give you the best chance of seeing a return on your investment.

    - Get expert advice! If you're not familiar with land development, it's important to get help from an experienced professional.

    - Be patient. Development can take time, so be prepared to wait a while before seeing a return on your investment.

  • Investing in land for development can be a great way to make money, but it's important to understand the risks involved. By doing your research and following these tips, you can increase your chances of success!

DOMESTIC LAND DEVELOPMENT DEFINITIONS

  1. Architectural Review Board – A group of individuals who review and approve architectural elements, e.g., style, colors, landscaping, and design.

  2. Area and Location Map – A map that identifies the area and location of a specific parcel of land.

  3. Arial Photographs – Photographs taken of a parcel of land that are taken from above the property.

  4. Assisted Care Facilities – A facility that has staff to assist its residents with meals, shopping, etc.

  5. Board of Zoning Adjustments – Board that approves or denies variances, conditional use permits, and special exceptions.

  6. Book and Page – The location of a plot recorded in public records.

  7. Building Code – A set of standards and rules that specify the requirements that must be met to construct a building.

  8. Cap Rate – The rate used to determine the present value of property with future earnings.

  9. City Council – A group of individuals who assemble to deliberate city matters including zoning, planning, etc.

  10. Comprehensive Plan – Cities and counties outlined plan for growth up to 20 years into the future. These plans tell you where critical services (e.g., water and sewer) are going to be installed and which areas are targeted for revitalization.

  11. Conceptual Plan – A plan that includes all the elements of a potential development.

  12. Conditional Use Permits – Permits with specific conditions or restrictions required for using the permit.

  13. Condominium – A building with individual units and common areas. The owner holds title to an individual unit and a percentage of the interest in the common areas.

  14. Contours Intervals – The distance between elevation lines, e.g., 5-feet interval, 10-feet interval, etc.

  15. Covenants, Conditions and Restrictions – Established agreements, limitations, etc. for private or public use of real property.

  16. Cul-de-Sac – A subdivision where a street ends with a vehicle turnaround.

  17. Curb Cuts – The cut in the curb that allows for ingress and egress such as a driveway.

  18. Density – The number of units allowed per acre of land.

  19. Developer – An entity or individual developing a parcel of land.

  20. Development – The construction of a project that modifies the original parcel of land.

  21. Development of Regional Impact Study – A detailed and specific explanation regarding how a development will impact the city, county, region, state, and federal sensitivities.

  22. Easement – Legal right of an entity, individual, or government body to access and have limited use of real property not owned by that entity, individual, or government body.

  23. Environmentally Protected Areas – Areas where development is restricted or not allowed to protect environmentally sensitive land. These areas may be protected at the local, state, and federal levels or a combination of the three.

  24. Equity Sharing – The sharing of the interest, free of indebtedness, in real property.

  25. Footprint – The area where the foundation is allowed on a parcel of land taking into account the setbacks, easements, retention areas, etc.

  26. General partnership – A partnership where two or more individuals participate in the management of the business and each partner is personally liable for all the obligations of the business.

  27. Grading – The cut, fill and compaction of a parcel of land in preparation for construction.

  28. Grubbing – The removal of vegetation, trees, boulders, etc. from a parcel of land.

  29. Height Limit – A limit on the height of a structure imposed by local ordinance, etc.

  30. Highest and Best Use – Using a parcel of land where the value of the asset is maximized.

  31. Impact Study – A study of the impact a development has on such factors as population, air quality, water quality, the environment, etc.

  32. Ingress and Egress – The location where you can go in and out of a piece of property.

  33. Joint Venture – A partnership between two or more entities or individuals for sharing resources and profits for a specific project.

  34. Land Coverage – The percentage of land allowed to be covered by buildings, parking lots, streets, etc.

  35. Land Use Plan – A plan describing the use of a parcel of land. The plan may be currently in use or a conceptual one illustrating the future use of the land.

  36. Loft – A large open space under roof.

  37. Lot and Block – The lot number and block number identifying a parcel of land recorded on a certain page and in a certain plat book.

  38. Master Plan – A city or county plan that describes the current and future use of land.

  39. Metes and Bounds – A surveyor’s method of describing large tracts of land. Metes are the measurements and bounds are the directions. This is considered the most accurate type of legal description.

  40. Mini Warehouse – Storage building separated into individual storage units.

  41. Mixed-Use Developments – Developments that have some combination of commercial, residential, and industrial buildings.

  42. Open Space – An area of light and air generally used for environmental, recreational, or scenic purposes.

  43. Planned Development Projects (PDP) – A development review process required by a local government agency for large projects such as commercial, industrial, mobile home, mixed use, or residential.

  44. Planned Unit Development (PUD) – Large mixed-use developments that may have commercial, industrial, and residential uses on one property.

  45. Planning Commission – A group of individuals charged with the responsibility of zoning for current and future land use.

  46. Plat – A map of a subdivided parcel of land.

  47. Plat Book – The public record where the plat is recorded.

  48. Quasi-Judicial Process – A legal process of a similar nature in real estate.

  49. Rendering – A drawing of a proposed building.

  50. Retention Areas – An area for retaining water, soil, vegetation, etc. as required by local, state, or federal requirements.

  51. Return on Investment – The profit calculated from cash flow, appreciation, and taxes.

  52. Section, Township, Range – A government survey method of identifying land. In Florida, thirty-six sections (one-square mile) are in a township (a six-mile square) located north/south of the state’s capital city and in a specific range (east/west location relative to the state’s capital city).

  53. Setbacks – Allowing a building to be constructed a set distance from a property line.

  54. Site Plan – A drawing of the proposed construction of a building, development, etc. in relationship to a parcel of land.

  55. Special Exceptions – An exception to a particular zoning requirement.

  56. Square Footage – Area measurement used in calculating land and building size.

  57. Subdivision – A subdivided area of land.

  58. Surveyor – An entity or individual that determines the area of a parcel of land by measuring the parcel and documenting it on a survey.

  59. Topographic Survey – A survey that graphically shows the features of a parcel of land.

  60. Townhouse – An attached house that is not classified as a condominium.

  61. Variances – A deviation from the building code or zoning ordinance.

  62. Wet Areas – Areas defined by local, state, or federal agencies as areas that retain water. Most areas identified as wetlands are protected by one or more agencies and require specific permitting for development.

  63. Zero Lot Line – Constructing a building on one or more of the property’s lot lines.

  64. Zoning Board – A group of individuals who assemble to review and approve zoning issues.

  65. Zoning Map – A map that shows zoning in a particular city.

Areas of Review

Takeaway

Big picture takeaway points

  1. Land is all around us and most people don’t think about it as a real estate strategy, but it can yield a huge return.
  2. As with any strategy, land development has its pros and cons.

Reflection

Self-reflection questions to think more about the content

  1. Have I done my research? If this is a strategy you think might be for you do your research and educate yourself, so you know what to look for and in the right areas.
  2. Have I spoken to any pros? Get good advice from a pro who specializes in this kind of strategy.
  3. Do I have the time? Be patient, this kind of strategy takes time to yield the return.

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