Thinking of Subdividing? Here Are the Factors You Need to Consider First

If you’re thinking of subdividing or developing a piece of property, there are several factors you need to consider to determine whether or not that will be economically feasible.

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If you’re thinking about subdividing a piece of property or developing it and then selling it, you first need to determine whether taking this step is economically feasible.

Some parcels of land can be used for high-density development, but a lot of them can’t. This means you need to consider factors like how close your land is in proximity to the nearest city limits, whether your water lines and utilities are available and strong enough to service the number of rooftops you plan on building, how the land slopes in relation to the nearest sewer, etc.

Another factor to consider if your property is somewhat larger (50 acres or so) is whether the road accessing the property can handle the type of traffic that comes from being near the city limits. By and large, you can fit two and a half to three homes per acre on a developable property. By “developable”, I mean that the roads, sidewalks, and infrastructure can allow the fire and police departments to service the community properly.
 

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When a developer invests in a property, the most affordable part is the land, itself.

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It’s important for you to remember that when a developer invests in a property, the most affordable part is the land, itself. The expensive part is building the infrastructure and adding all the off-site improvements (i.e., water lines, sewer lines, gas lines, sidewalks).

On a 50-acre property, you can build anywhere from 100 to 150 homes. If you add that much traffic—say, two cars per household—to a county road that doesn’t have curbs, gutters, and proper stormwater planning, that can create a plethora of problems. Adding stoplights and turning lanes can cost up to $250,000, so that alone can make a property economically unfeasible for development.

Every property is different, and there are many other things to consider before you decide to subdivide and/or develop yours, but these are just a few factors to educate yourself about before moving forward.

If you have any other questions about this topic or you’re curious about what’s going on in our market, don’t hesitate to reach out to me. I’d be glad to help you.

How to Buy and Sell at the Same Time

If you’d like to buy a house but you also need to sell your current house, you need to design a smart buying and selling strategy. Here’s how you can do that.

Want to sell your Kansas City Home? Get a home value report here 

Want to buy a Kansas City home? Search all homes for sale here

If you need to sell your current home to buy another home you’re interested in, there are several strategies you can use.

To design a smart home buying and selling strategy, you should first look at your overall goals and what your financial situation is. What kind of equity will you be rolling into the new home? What kind of mortgage payments are you looking for?

You should also consider implementing contingencies. In this type of situation, we oftentimes work with clients who buy a home that’s contingent on the closing of their current home. You can also use bridge and swing loans that will give you more time between buying one home and selling the other and help you avoid the crunch of a simultaneous closing.
 

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You have a much better chance at influencing all of these moving parts if you put together a great team behind you.

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Whether you’re buying or selling, there are about 75 people who are either directly or indirectly involved in the transaction, and you have a much better chance at influencing all of these moving parts if you put together a great team behind you. With everything that’s happening, coordinating both transactions can seem like threading a needle. This is why, when we work with homeowners in this situation, we sit down with them, go over every possible strategy, review their financial situation, and look at the market itself. Whether we’re in a buyer’s market or a seller’s market will affect your strategy.

As long as you take the time to put together a plan with your real estate agent and put together a great team behind you, you can make buying and selling at the same time a stress-free situation.

If you have any questions about this topic or you have a topic you’d like us to discuss in a future video, don’t hesitate to reach out to us. We’d love to speak to you.