Do Not Sell Your Land!

Develop It Yourself.

Did you inherit a parking lot in a city? Are your folks getting old, and their house is ready to be torn down? Can the land be subdivided? Did your investment property get rezoned and now could be developed into something bigger? 

Developing your own land is not as hard as you might think. It is not easy by any means, but with the right guidance and resources, you can turn your vision into reality and reap the benefits of being your own developer. We share lots of knowledge on the internet, but we are also here to help implement it. Here are some reasons why you should develop your own land and how to get started.

Why Develop Your Own Land?

• Your land is worth less than what you think. Many property owners think that their land is worth more. Sometimes it does. Oftentimes, the unrealized potential is not the current value. If you are reading this during an economic downturn, the number of buyers is significantly reduced, and not many builders/developers are looking to acquire new land. 
• You can double the value of your land. By developing your own land, you can create a higher and better use for your property and generate more income from it. For example, if you own a single-family home on a large lot, you could subdivide and build several homes or develop a multi-family townhouse project, apartment building, or a mixed-use project with retail and office space. This way, you can increase the density and diversity of your property and create more value for yourself and your tenants. Even a new single-family home would bring more return than selling the raw land. According to a study by the Urban Land Institute, the average return on cost for developers in the U.S. was 18.4% in 2020. This means that for every $100 you spend in developing your own land, you can expect to get back $118.4 in value. Combine that with proper leverage, and you are able to double your investment or more. 
• You can control the design and quality of your project. By developing your own land, you can have more say in how your project looks and functions. You can choose the architectural style, the materials, the amenities, and the features that suit your taste and needs. You can also ensure that your project meets the highest standards of quality and sustainability. You can incorporate green building practices, energy-efficient systems, and smart technologies that can reduce your environmental impact and save you money in the long run. You can also create a project that reflects your personality and values and that adds to the character and identity of your neighborhood. I say this with a caveat: many inexperienced developers rush into designing the building without a proper cost-control mechanism. You must be very careful not to blow your budget here and to design the product that the market will want. 
• You can contribute to the social and economic development of your community. By developing your own land, you can create a positive impact on your community and society. You can provide more housing options, more jobs, more services, and more amenities for your area. You can also support local businesses, artists, and organizations that can benefit from your project. You can also create a sense of place and community for your residents and visitors. You can foster social interaction, cultural diversity, and civic engagement. By developing your own land, you can be a part of the solution to some of the most pressing challenges of our time, such as housing affordability, urban sprawl, climate change, and social inequality.

How to Develop Your Own Land?

• Look through the local land use code. I hate reading code, sorry. It’s boring. It’s written by people who do not have a life. Half the time it makes no sense, and you also need to remember that even if there is something in the code, you could ask for a variance, exception or departure. BUT the land use code would typically give you a good guidance on what the municipality would like to see built. Look for zoning information, setbacks, height and bulk limits, parking requirements, etc. Most municipalities these days have their code published online. Worst case, you might have to visit your local city hall or county office. 
• Learn from online resources. There are plenty of online resources that can help you learn the basics of real estate development and guide you through the steps of developing your own land. Some of the best online resources are:
  • Introduction to the Real Estate Development Process Course by Urban Land Institute: This is a comprehensive online course that teaches you everything you need to know about real estate development, from finding and analyzing deals to financing and managing your project to marketing and selling your product. The course also includes case studies, templates, tools, and resources that you can use for your own project.
  • Real Estate Development Podcasts: There are a number of regular podcasts that feature interviews with successful real estate developers, investors, and entrepreneurs who share their insights, tips, and stories about developing their own land. These podcasts cover topics such as market trends, design trends, financing strategies, legal issues, and best practices for real estate development. 
  • Real Estate Development Blogs: This is a blog that provides useful information and advice on various aspects of real estate development, such as site selection, feasibility analysis, design, construction, leasing, and sales. There are plenty of others, so go ahead and google them. My goal is to provide education for investors. You can totally do it yourself. But if you need help, drop us a line. 
• Get guidance from a professional developer. If you want to take your learning to the next level and get personalized and hands-on guidance for your project, you can hire a professional developer who can mentor you and coach you throughout the development process. A professional developer can help you avoid costly mistakes, overcome challenges, and achieve your goals. A professional developer can also help you access more opportunities, resources, and networks that can enhance your project. Some developers work for a fee, some co-invest, and some take full charge, where you become a silent partner. 
• Many people start by talking to an architect. An architect can help you assess the feasibility of your project and advise you on the best design and development strategy for your land. An architect can also help you navigate the zoning, permitting, and approval processes that are required for your project. A good architect will get you excited about the possibility of building a new project. They will present you with sexy visuals to help you see what a future building could look like. Be careful here not to fall in love with an early concept. The final design often looks much different. An architect can also help you create a realistic budget and timeline for your project and connect you with other professionals and consultants that you will need along the way, such as engineers, contractors, lawyers, accountants, and lenders. Architects are usually very good at reading local codes and can help navigate the legalese and permitting process. 
• Get a contractor involved early on. The biggest mistake many inexperienced developers make is not to hire a contractor at the beginning of the project. No disrespect to architects, but they do not know how much things cost. Many of them do not want to be involved in costing because it opens them up to liability. An experienced general contractor would be able to work along side your development team and help estimate construction costs from the beginning. Preconstruction services is a significant expense in project development. Do not cut it out of your budget. 
• Other engineers and consultants. There are many other consultants who could help get the project going. The surveyor would give you a starting point by drawing up your site boundaries and topography and identifying easement; Geotechnical engineer is an important early advisor who can test the soils and provide important feedback to the other team members; structural and civil engineers should weigh in early to avoid costly mistakes in the future. 

Conclusion

Developing your own land is one of the best ways to create wealth, express your creativity, and make a difference in the world. If you own a piece of land that has potential for development, do not sell it. Develop it yourself. You have the power and the opportunity to turn your land into something amazing. All you need is the right guidance and resources. Start by talking to an architect, learn from online resources, and get guidance from a professional developer. You will be surprised by what you can accomplish and how much you can enjoy the process. Do not wait. Start developing your own land today. 

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P.S. To keep the lawyers at bay, any investment is subject to risk. Land development is investing land into a project that aims to increase its value. Past performance is not indicative of future results. No, we are not offering any securities here. Any projections or assumptions could be wrong. The investment could result in a total loss. Ask for professional advice before making decisions. Don’t say I didn’t warn you. In the words of my children: “It’s not my fault!”