QnaGold.com Real Estate Investments

7Mar/100

Subdividing Land – How To Unlock The Profit In A Large Block

Subdiving land can be a profitable investment strategy. Unlike buying run down homes that need a lot of manual labor, subdividing a block is a lot quicker and simpler providing you do your due diligence before you buy. In fact the profits are made when you buy, not when you sell.

The reason why I say this is because we buy profits, not land. It is this mind set that separates a seasoned investor from a beginner. A seasoned investors knows his values. He understands the market intimately and is able to fairly accurately put a price on any individual block with speed. Having this skill, it is easy to look at a block and identify quickly whether the block is profitable just by knowing the asking price.

Subdividing land is not risky if you can do this and is very very profitable because it can be turned over more quickly than a house and land. The lower entry costs of land also make it an ideal choice for entry level investors.

Your due diligence should be conducted before you purchase and not afterwards. A quick trip to the city town planning department will give you all sorts of publicly available information about the block you intend to subdivide. The first thing you need to know is what the minimum allowable sizes a block of land may be in the zoning laws.

This will allow you to understand if the block can be split. For example in my area, the minimum is 450sqm, so the block would need to be at least 1000 or maybe more. The reason why is because on every block of land there are city easements that need to be left free and clear so utilities and such can be accessed. Also room for drive ways etc are needed so subdividing a block you need to allow for these requirements. Your local town planner can advise you on their local ordinances and they are a valuable source of information. If you intend to subdivide land regularly in your area, it would be wise to get to know these officials and communicate with them effectively. The ideal blocks are corner blocks. But the key is the zoning code.

By: Martin Thomson

About the Author:

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Tagged as: Profits, Reason, Town Planning No Comments

7Mar/100

Why to Invest in Tennessee Land

Tennessee is a great place to invest in. The southern hospitality, great weather, outdoor beauty and peacefulness has turned investment in Tennessee into a big market. Owning land in Tennessee is great for building a home, investing, retiring, or just having a place to take a vacation to.

Tennessee is known for its industries, professional sports, and country music. Tennessee is most famous for its music; Elvis Presley's home was in Memphis, the State's capital. Tennessee is huge on sports as well. It is home to three professional sports teams: The Tennessee Titans of the NFL, The Memphis Grizzlies of the NBA, and The Nashville Predators of the NHL. These teams bring many fans and spectators to the State, as well as provide additional entertainment to the State's residents.

So why invest in Tennessee Land For Sale?

According to Forbes, Tennessee is the 13th best place to do business in, up seven spots from its 2006 rank of 20th. It also has the 3rd best business costs in Tennessee. This means setting up shop in Tennessee is much cheaper than the vast majority of other States. It also means that people have recognized, over the years that Tennessee is a great place to do business.

According to Lawrence Yun, the National Association of Realtors senior economist, Nashville, Tennessee will have the biggest Real Estate market gains within the next five years.

It is interesting to note that even though most of the United States is in a real estate depression, the Nashville area has remained steady. Sellers report that it takes around 70 days of a house sitting on the market until it sells, which is good for the seller. Buyers are also happy as increased inventory means its still a good time to buy. The point here is that there is a steady rise in prices in this area. It's a great time to invest in Tennessee; You can buy real estate at good prices and still see it appreciate.

Knowing there are areas in Tennessee where even the Real Estate market is still good, it's obvious to see why land is such a great investment.

By: Gregory Akerman

About the Author:

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Tagged as: Building A Home, Business Costs, National Association Of Realtors No Comments

6Mar/100

Investing in Land for Development: Cardinal Rules

People who invest in land for a living, like builders and developers, know that following a couple of cardinal rules can mean the difference between having a deal that's potentially viable and one that is a disaster in the making. Here are the principles that influence their purchasing decisions.

Rule 1: Location
Location is the most important aspect of a property because it's the only thing that cannot be changed. You can demolish or add onto a house or maybe even pick it up and move it, but you cannot pick the land up and move it. Location determines not only how the property can be used (zoning) and accessibility to public utilities, but also the parcel's value based on the surrounding properties. There is no substitute for a good location.

Rule 2: Value Is Always Related to Use
The value of land for development hinges on its ability to be used by buyers. A 10 acre parcel with substantial areas of floodplain, steep slopes or wetlands may produce only one building lot. Its value will ultimately be determined by what a buyer can do with it (i.e., build one house) and not by the number of acres it has.

Rule 3: More Target Markets = Higher Value
Value increases if the parcel can be used by many potential buyers or categories of buyers. Several factors determine the market appeal of development land. These include uses permitted under current zoning, location, availability of public or on-site utilities, physical characteristics, and legal restrictions. Suppose you're thinking about buying a property that abuts a pig farm. It has everything you want, including a cheap price tag. But chances are, you won't find many buyers for it when you go to sell. Conversely, you will have to pay more for a parcel abutting parkland, but you'll have your choice of buyers willing to pay a premium price for it.

Rule 4: Value = Price + Terms
Ultimately, buyers determine what a property is worth, but an offer is much more than just price. It's a set of scales with price on one side and terms and conditions on the other. The real value of development land is the price a buyer is willing to pay in exchange for terms and conditions. For example, you want to buy a landlocked parcel. You need to know if the owner of the adjoining property will sell off some frontage. You don't want to purchase the frontage unless the seller accepts your offer and you don't want to have to buy the property if you can't get the requisite amount of frontage. So you would give the seller an offer contingent on your being able to get the frontage and anything else you'd need to be able to sell the parcel to builders. You would offer the seller a higher price if the seller would agree to these conditions than if the seller wanted to sell "as is."

Rule 5: When Buying, Think Like a Seller
Before you decide to buy a land parcel, you should evaluate it as objectively as possible and try to identify objections that buyers might have when you go to sell. In short, when investing in land, think like a seller because your goal is to sell the parcel, not live on it. When builders purchase land for development, they evaluate it in the context of the property's appeal in the eyes of the end users (i.e., home buyers or those leasing or purchasing office and retail space).

Rule 6: Do Your Due Diligence
Most of what you need to know about the land parcel cannot be seen. So many issues need to be investigated, including zoning, utilities, surrounding property uses and values, deed and other title restrictions, and the site's physical features. It's absolutely critical that the due diligence be performed thoroughly, even if that means you have to hire somebody to do it for you. There are no short cuts here. Incorrect assumptions, bad information and what you don't know could come back to haunt you.

By: Nancy Chadwick

About the Author:
Nancy Chadwick is a PA licensed real estate Broker and Instructor specializing in land brokerage, consulting and development. Her experiences and real estate development courses provided the foundation for her books Buying & Selling and Selling Land: The Owner's Guide available at http://www.LandBuyingandSelling.com/
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Tagged as: Building Lot, Decisions, Location Location No Comments

6Mar/100

Real Estate Investors – Due Diligence Is The Way To Protect Yourself!

Whether you are a new or experienced Real Estate Investor, one of the first things you will learn is to always do your own due diligence. Well what exactly does this mean?

Doing your own due diligence means taking the time to learn, study, review, check-out, and investigate a certain business or deal prior to your commitment to purchase, in order to make sure the business (or deal) is everything that you thought it was.

When it comes to investing in Real Estate, due diligence is used in several different ways. You will often see the term due diligence used when analyzing a deal or a property (again, prior to purchase). This will include not only the renovation work that needs to be done but the costs of the materials and labor of the renovations as well.

Due diligence includes making sure you have used the necessary tools to gather comparables (comps) in order to determine the fair market price or after repair value. Other items on your list include making sure you are fully aware of any current or past tax or title issues, as well as knowing about the current zoning, floodplains, easements, etc.

Further due diligence is required for landlords who are purchasing a property to buy and hold especially if those properties are already occupied. In this case, due diligence will include inspecting not only the properties themselves but the current leases, rent rolls, and security deposits. If applicable governmental such as section 8 approval certificates may have to be looked into as well.

One important issue that many new Real Estate Investors seem to forget about is the importance of doing your own due diligence when it comes to working with other Real Estate Investors, no matter how friendly or experienced they are.

One of the benefits that the REI for Newbies Insider's Club members have is the ability to email me with any and all questions that they have. I recently received an email from a new real estate investor who was really excited about the possibility of finally purchasing his first rehab. He found the property through another investor who had too many so he was unloading some of them. Turns out that after all was said and done this would have been a terrible deal for a new real estate investor.

The numbers that the experienced investor provided to the newbie were simply not entirely on the up and up. While I am sure that he meant no harm, this could have ended up being a really big problem for the new investor.

You see the experienced investor told the new investor that he could be in and out, meaning the property could be ready for market in less than 4 weeks. But what he failed to remember was that the experienced investor already had his team assembled while the new investor was starting totally from scratch. The new investor had to first start with finding contractors and getting estimates.

Not only that, but the experienced investor had his real estate license so his costs to resell the property were not going to be as high as the new investor who is not licensed. Overall, the numbers were just too tight for someone who was brand new. Luckily the new investor took a step back and avoided being a motivated buyer.

By the way, I have seen many experienced investors specifically say that they have an extra property that would not be good for a newbie. Generally speaking this is the type of experienced investor circle that newbie investors want to become a part of.

The bottom line is that all Real Estate Investors, no matter how experienced or not, need to do his/her own due diligence no matter where or who they get their leads from. Always remember that no one is going to protect your business or your potential profits like you will.

Chris Parks is an Entrepreneur & Real Estate Investor who created Real Estate Investing for Newbies to teach and assist new Real Estate Investors in a step-by-step and easy-to-understand manner. Get Your Free 7-Day E-Course Here: http://www.REIforNewbies.com

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Tagged as: Comparables, Easements, Floodplains, Inspections, Title Issues, Zoning No Comments

6Mar/100

Texas Land Information – Why You Should Bother Investing in Real Texas Land

Texas is a huge state; it encompasses over 260,000 square miles making it the second biggest state in the Union. Needless to say, with this much square footage there is a lot of Texas land to go around. Some of it is taken, having been transformed into the illustrious cities of San Antonio, Dallas, Houston and others. Much of it remains unremarkable and insignificant, just sitting there waiting for someone to claim it. Could that person be you? Texas land is a valuable investment, at least in the eyes of many people. There are so many reasons why the investment is a smart one, and one that even beginners should be fairly confident in its return.

People Want to Live in Texas

One of the more obvious reasons why Texas land is a good investment is because people want to live in Texas. Texas land information can be made available to anyone; people want to build homes or start businesses and with the troubles the United States economy has seen so far this century, people are moving around to get a fresh start. Texas is one of the prime locations, as are other spots around the southern United States. Land that can be developed into a home or farming is a good investment.

People are Doing Business in Texas

It seems obvious to say that people are doing business in Texas; after all, people do business everywhere, right? Not exactly; while many state economies have experienced a slump in business of every sort just because people aren't buying and selling, land property and real estate are the first to be hit. This isn't the case in Texas. As a matter of fact, the economy in Texas has managed to remain rather strong even through the country's economic troubles. Texas has the second largest economy in the United States, second only to New York.

Agriculture is an Active Part of Texas Economy

Land sold for agricultural purposes can bring in a lot of profit. This is because people tend to need a lot of acreage at one time if they want to use it for agricultural purposes. If you have acquired land in the right area, it may be sold for agricultural purposes which allows larger plots of land to be useful to one buyer as opposed to dividing the same acreage among several buyers.

There are so many reasons to buy land in Texas. It is a great investment for those who don't want to take a lot of risk when it comes to buying land. People are always moving into Texas, and there are so many uses for Texas land. It would be silly to pass up on a potential investment in Texas land if things were right. Is there a plot of Texas land calling your name?

By: Gregory Akerman

About the Author:

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