Teardown and Subdivision Opportunity - Where to Begin? (Concord, CA)
Over the last few weeks or so, I've been speaking with a gentleman who owns a parcel of land in Concord, CA. The parcel is 1.18 acres. Currently, there is a house sitting on the lot that needs to just be torn down. The owner has provided me with plans that he had drawn up 15-20 years ago that were never submitted to the city for review. So, from my eyes there is quite a bit of potential to make something happen here; the only problem is I'm not sure how to maximize the potential from this lead.
The possibilities I see in front of me are:
- Refer the lead to a developer and collect a small fee
- Get the property under contract and wholesale the contract
- Tie up the property for a period of time (either with an Option to Buy or a Purchase Agreement with a lengthy contingency period) and try to get subdivision plans drawn, submitted and approved before selling to a developer
- Somehow buy, subdivide and develop myself
My background thus far in REI is 4 deals - (1 completed flip, 1 wholesale and 2 ongoing flips). If you were in my shoes, what would you do? I think the greatest return would be from going through the entire subdivision approval process and then selling approved plans to a developer; however I have no idea the amount of time or cost required to get that done. Any recommendations from folks who deal in raw land, subdivisions or developments?
And, because I just read the very timely article from @Karen Margrave here are the lot characteristics:
- Average lot sizes in the area are 6,000 - 10,000 sq. ft.
- Infill lot with no views (rest of the area is completely developed)
- Lot is almost completely flat
- Houses in the area are selling for roughly $330/sq. ft.
- Some other lots that have sold in the last year have gone between $115k - $200k