construction

Real Estate

Latest Green Buyer Trends for Real Estate Investors

by Jim Simcoe | June 18, 2010

A 2010 study just published by AvidBuilder.com (a leading research and management company serving the home building community) had some surprising insights into the desires of potential home buyers.  The study was based on a survey of 11,335 home-owners that built houses in the last 9 years. The group was segmented into six buyer types [...]

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Real Estate Development

Residential Land Development – Part 4: Construction and Marketing

by Craig Grella | November 12, 2009
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To recap Residential Land Development Part 3 we discussed researching zoning, designing your home, and financing the property. In this article we will discuss construction and marketing, the final two stages in any development project.  These are the action steps in the development process.  They’re also two segments that involve the least research, because if [...]

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Commentary

Grow Your Real Estate Network; Get Involved Locally

by Justin Pierce | November 8, 2009
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I cringe to even think of writing this post, peppered with politics, but we just had an election for a Governor here in Virginia and it raises a few points that I think investors (well any businessman or woman) should keep in mind. Don’t worry, we’re not talking party politics, but local political involvement. Put [...]

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Real Estate Investing

Residential Land Development – Part 3: Zoning, Design and Financing

by Craig Grella | October 23, 2009

To recap Residential Land Development Part 2, we discussed the importance of performing an economic feasibility study with cost estimating to determine a max price land offer and whether or not there is enough profit in your potential deal to warrant spending more time on it, or actually developing the land.

Assuming you’ve done that initial research and arrived at the conclusion your numbers look good, you’re ready to go back and do it all over again. This time you’re going to be more exact with your numbers. To do that, you’ll really need to hone in on the potential design of your house, and to do that you need to research what’s possible on your lot. You do that by learning all you can about the zoning codes in your city. These are the third and fourth steps in the residential land development process.

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Land & Farm Investing

Residential Land Development – Part 2: Determining Economic Feasibility

by Craig Grella | October 16, 2009

This is Part 2 in the Residential Land Development series showing you how to find, price, and develop land for residential single family property.

If you’ve followed Residential Land Development Part 1 you’ve put together your development team, done a little research into the type of property you want to build and the market you will farm for potential land purchases. You’ve determined the highest and best use, researched zoning and other legal matters, and now need to determine the economic feasibility of the project. We do this by estimating the overall costs of the project. The results of your down and dirty, quick economic feasibility analysis will determine whether you move forward with your project, or whether you dump it and move on to the next piece of land. Here’s what you’ll do:

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Land & Farm Investing

Residential Land Development – Part 1

by Craig Grella | October 9, 2009

Since their invention, heavy equipment such as...Last week I wrote an article describing how to price and develop offers on land purchases.  While that information is an important part of the overall development process, it is only a small fraction of the work that needs to go into developing land for residential use.  As such, I’d like to explore the residential land development process in a more thorough manner, which will include this article, and several to follow.

With that said, this article will focus on the process of land development, risks and rewards, and a few things you’ll need to get started in the business of Residential Land Development.

Land development is the process of preparing raw land for the construction of improvements.

It can include:

  • Demolition of existing improvements
  • Clearing and Grading
  • Rezoning if required
  • Installing utilities, sewers, streets, and sidewalks
  • Constructing Improvements like driveways, foundations, and building pads

Although developed land creates no more income than raw land, it is nevertheless brings land one step closer to its ultimate use; a home, apartments, office buildings, hotels, etc.

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Commercial Real Estate

Developing Real Estate: How to Price Land for Profit

by Craig Grella | October 2, 2009

Pricing land for development can be a daunting task for the untrained investor. As a niche subset of both residential and commercial real estate, using comparables for land can be as dangerous to a developer as it is mysterious, sometimes causing the failure of what was certain to be a fantastic development.

However, for the savvy investor, there is one universally accepted land valuation method used by development professionals, corporations, and appraisers alike; the Land Residual Method. By using this method you will be able to determine the current and future value of any piece of land, whether its use be residential or commercial. You will also be able to price land, such that any development you propose will have built in profit. With some practice, you will be able to employ the land residual method in just a few moments, summing up the value of almost any property just on sight.

The land residual method has a fancy sounding name, but to use it all you need is an understanding of some simple math. The land residual method is a calculation that takes the highest and best use of a particular piece of property and subtracts out the total cost of development to arrive at the residual value: the land value. Once you have the numbers it’s that easy. “How do you get the numbers?” You ask. It takes some research, but even a novice investor can figure it out relatively quickly.

For the sake of this article I’ll be speaking to residential single family development or single family lot land. Rest assured, commercial development uses the same principles, though the calculations are a little more in depth.

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Housing

Builders Now Getting Screwed By Banks; Obama Must Deal With Plight Of Home Owners and Builders At Same Time

by Charles Feldman | January 21, 2009

We are officially in the age of Obama now The market was clearly waiting to hear more from the President on how he intends to fix the credit/housing crisis. And, since he really didn’t address it with any detail in his inauguration speech, investors drove the market way down yesterday. While many wait to see [...]

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Real Estate Law

Buying New Construction? Don’t let those builders push you around!!

by Joshua M. Marks, Esq. | October 29, 2007

From the concrete streets of metropolitan cities to the sprawling suburbs in most areas around the country, new construction is present in the form of townhouses, condominiums, single homes and the ever-so-popular “over-55 communities.” While many of these properties are esthetically impressive complete with over-sized family rooms, open kitchen areas, and every upgrade/option imaginable, there [...]

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Commentary

Welcome to Miami’s Condo Bust

by Joshua Dorkin | August 30, 2007

The Orlando Sentinel had an extremely interesting article today about the Miami Condo Bust. The article detailed the dangers that go along with pre-construction investing real estate speculation. How’s this for scary: “Just how many other speculators face the same dilemma in the nation’s most glutted condo market will become clear during the next two [...]

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Economy

Real Estate Dispatch – 1/3/07

by Joshua Dorkin | January 3, 2007

A few days have passed in 2007, and there are a few stories I think are worth a look. Enjoy! Manhattan real estate market remains strong The Manhattan Market is INCREDIBLE! “The average price of a Manhattan apartment rose to more than $1.14 million in the fourth quarter of last year, up 5 percent compared [...]

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Commentary

Real Estate Bubble Popping, Housing Starts and Building Permits Tumble

by Joshua Dorkin | November 17, 2006

CNBC is reporting this morning that US Housing Starts declined in October 14.6% to the lowest level in 6 years, while building permits were down a whopping 6.29%. Guests on the network, James Wilson and Jan Hatzius (Goldman Sachs Economist), predicted that housing will be a drag on GDP in ’07. Hatzius attributed the problem [...]

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Economy

Housing Slump Brings U.S. Economy Down;Manufacturing Stalls

by Charles Feldman | November 1, 2006

Bad news overall for the U.S. economy and mostly due  to weak construction spending and weak home sales, according to a report Wednesday by Reuters News Service. According to the report, U.S. manufacturing growth “came close to stagnating” last month and experts are saying this downturn is housing led. Figures reported by Reuters are telling: [...]

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Economy

An Unexpected Rise In Housing Starts;Some Say Slump May Be Near Bottom

by Charles Feldman | October 22, 2006

By definition, news is –well–about new and sometimes unexpected things. Such is the case apparently with U.S. housing starts which surprised some experts by rising last month by an estimated 5.9%, according to a Commerce Department report. Bob Willis,writing for Bloomberg and reported in the Detroit Free Press, says some believe “the housing slump may [...]

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Economy

Stock & Housing Market Update

by Joshua Dorkin | September 29, 2006

Although the stock market’s Dow Industrials has flirted with an all-time-high for the past several days, and oil has maintained its decline, the housing market continues to look weak. Here are a few highlights from Today’s MarketWatch report: – “Banc of America Securities said Friday it expects pending home sales to decline between 3% and [...]

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