Buying land to subdivide, good investment?

[sarmanz_male]

I have a group of people who are interested in buying land together for the sole purpose of subdividing and selling. In your opinion, is this a good strategy? Anyone have any experience doing something like this?

[Cement Bench]

what is your budget and what is your time and what profit are you expecting?

[Dewey Cox]

It could cost a lot more than you expect if you have to hold it for a while till it sells.
Tax on the smaller parcels will be more than the tax on the whole quarter.
Also, make sure that county will actually allow you to split up a quarter in the way you're intending.

[Iron Brew]

Originally Posted by Dewey Cox

It could cost a lot more than you expect if you have to hold it for a while till it sells.
Tax on the smaller parcels will be more than the tax on the whole quarter.
Also, make sure that county will actually allow you to split up a quarter in the way you're intending.

This. When I subdivided mine, the county was NOT helpfull at all. For 3 lots, with a mutual driveway about 75 or 100m long, they wanted a turnaround so a full size school bus could make a U turn with no backing up. They wanted everything paved, and they also wanted 10% of all land to be "donated" to the county for green space. Since they didn't want that land, they tried to make me buy it back from them at prices they determined. I dropped to two lots with a common driveway for the last 20 meters, and still fought them on driveway issues. It was not a fun experience at all. I'd imagine what your proposing would have higher tax revenue for them, and they may be willing to work more with you.

[Trochu]

What exactly are you asking? Like, buying a quarter than has a railway though it, or some other dividing feature, subdividing it, and selling off the pieces, so zero work on the ground, or developing and subdividing? If the former, you could likely make a some profit. You can make more doing the latter, but you'll likely need patience and deep pockets. Developing land is a great way to make a mint, or go broke. It's been more of the latter in my town with three subdivision completed in the last 5 years mostly sitting empty.

[Dean2]

I read this a couple of hours ago and just moved on. Surprised to see it now actually has responses. Have to ask why any of you even bother to try and answer such a vacuous question. Without a reasonable effort on the OPS part to provide context, detail and even barely adequate information, why waste your time? But don't let me stop you from trying to make sense of nonsense.

[Kingfisher8]

I subdivided 10 acres from my quarter a couple of years back. I also had to buy back a portion of environmental land from the county. I think it was just over $1000. I did the initial survey myself with a rangefinder. The county needs a rough plan for approval then everything goes to the surveyor. I learnt that is you want a septic pump out that it has to be 10 acres square. If it isn't a complete square then you need a field system. My 10 acres isn't a complete square so if I build I'll have to get a field system which is a lot more money. Hope this helps.

[Trochu]

Originally Posted by Dean2

I read this a couple of hours ago and just moved on. Surprised to see it now actually has responses. Have to ask why any of you even bother to try and answer such a vacuous question. Without a reasonable effort on the OPS part to provide context, detail and even barely adequate information, why waste your time? But don't let me stop you from trying to make sense of nonsense.

Props, not often do I find "vacuous" used in a post!

[wildwoods]

Originally Posted by Trochu

Props, not often do I find "vacuous" used in a post!

haha x2. excellent

[urban rednek]

The smart developer invests other peoples money, and is contractually obligated to be paid no matter what happens with the development.
If you are not the smart developer in your scenario, be very careful.

[lannie]

Originally Posted by Dean2

I read this a couple of hours ago and just moved on. Surprised to see it now actually has responses. Have to ask why any of you even bother to try and answer such a vacuous question. Without a reasonable effort on the OPS part to provide context, detail and even barely adequate information, why waste your time? But don't let me stop you from trying to make sense of nonsense.

You just moved on....that is funny.

[jstubbs]

IMO: If it was even remotely easy, simple and profitable, professionals/companies would have beaten that horse dead years ago (and they have in a lot of areas). See other replies on this thread as proof.

[Who Da Fisherman]

Originally Posted by Dean2

I read this a couple of hours ago and just moved on. Surprised to see it now actually has responses. Have to ask why any of you even bother to try and answer such a vacuous question. Without a reasonable effort on the OPS part to provide context, detail and even barely adequate information, why waste your time? But don't let me stop you from trying to make sense of nonsense.

Reading your response was a waste of everyone's time, bahahaha
WDF

[liketoshoot]

I know 2 people that have done this, 1 made boat loads of cash the other made a long painful just above break even. Location and a good management resources will make the difference. Both did it on a shoestring budget

[ebspol]

Contact Brookfield.

[Red Bullets]

The OP's group can be either revenuers or speculators. Everything's a risk. Land subdivision is going to take time, if approved, no matter where you go. By the time you have it subdivided the economy could be worse. There are lands commuting distance SW of Edmonton that were bought and sub divided when things were going good. Many of those lots and small acreages sit empty.

In Alberta your group could buy bush quarters, clear the trees and makes some money from the trees. Then sell the land as cleared for more than you paid. Still a couple years project.

Alberta right now isn't the right place for land speculation. A few bigger projects going on in BC now. Better off buying land close to those projects. That's where the money will be flowing.

Might be better off if the group of people with money to invest in land go to Northern BC, the Yukon or Alaska and buy strips of gold claims. As long as the claims are on proven ground and the price of gold is high someone will want to buy a claim or two or lease the claims. Leasing for percentage could be easy dividends if you get serious miners. Gold prices are high right now too. Sadly, proven claims could be priced high too. Could go to Brazil and buy emerald claims. Great place for a holiday too.

[Jack Hardin]

Ten years ago in Red Deer County we wanted to further sub divide a quarter that was already sub divided into three parcels. The county said that to sub divide a quarter into four or more parcels will change the whole 1/4 from Ag to rural residential.
changing the taxes from next to nothing to a wheel barrow full. It also means that you will have to make the 1/4 pavement to pavement at our cost. For us that would be one mile of pavement. Also you must give the county the right to purchase a 5 metre strip of your land along side the road for $1. if and when they decide to widen the road in the future.

[Big Grey Wolf]

You need to wait for high oil prices in Alberta. It is a supply and demand situation. Your holding costs until parcels sell can ensure that your Banker makes All the profit. If you have no experience in land development you will probably spend All the $$$ as profit for your training wheels.
PS go count how many lots with weeds growing on them in your area before you jump in with both feet. Also parcels with feature like a mountain view, river or lake will be in demand, a piece of Alberta clay will not sell to fast or for much $$$. May not pay for the service cost per lot.

[MyAlberta]

Originally Posted by sarmanz_male

I have a group of people who are interested in buying land together for the sole purpose of subdividing and selling. In your opinion, is this a good strategy? Anyone have any experience doing something like this?

If you don’t know that it would be a good investment, I’d steer away.

My best investments have been had by understanding the fundamentals and leveraging them.

[Brbpuppy]

Might depend on where the land is. But the many vacant land lots for sale around my cabin have been on the market for years, and there is more and more going up for sale every year, and nothing is moving.
Just be careful.

[dcc7917]

Real estate investing is all about timing, you should determine if there is demand for the result of your subdivision and if the economy will be such that there is demand. Subdivision can be a long affair and the economy can change. Be careful and know your partners.

[Big Grey Wolf]

Will Rogers had a saying many years back. "If you want to make lots of $$$, find where people want to come. Then buy the land before they get there, and sell it to them when they arrive"

[Cement Bench]

is the op a ......plant

he has asked about houses a lot and never really contributed

seems odd to,me