Are you thinking of developing your raw land into a profitable property?
Whether you’re a home buyer or a novice real estate developer, raw land development can be a challenging but rewarding process.
Here are some things that you need to know before developing raw land into a profitable asset.
Have The Right Plan
Before you begin working on your development plan, know what you intend to do with the completed building structure.
Will you be selling this property to make a profit? Will you turn it into a rental for tenants, or will you use it for your own use?
Rentals, selling properties, and personal properties all come with different features. Custom features like a converted garage might work for you, but it might not appeal to a prospective homebuyer.
This is why it’s crucial to draw up a construction plan that aligns with your future goals and intentions.
Raw Land Development Takes Time
While buying raw land and developing it is definitely cheaper than a pre-made hot property, it also has a few downsides.
Raw land developers need to have a lot of patience to work through the property development and appreciation phase. Your contractor might cap the construction duration at 12 months, but inconsistencies such as bad weather, lack of funds and labor can stretch the process.
You must take out a construction loan to expedite the construction process and tackle any financial obligations that come in your way.
Know Your Zones
Before you begin drafting a real estate development plan, ensure that you know your zones.
Zoning codes determine the types of properties that can be constructed within a zone. For instance, you cannot get approved to build a residential home within a commercial real estate zone!
Knowing your jurisdiction’s zoning and building codes will ensure that you cut down on any potential fines or don’t face any permit rejections from the government authorities. Moreover, it’ll ensure that your development process rolls out smoothly and without any hurdles!
Work With Credible Professionals
Whether it comes to working with contractors, builders, or a private money lending firm, know that you’re partnering with the right people.
Research your contractors, sub-contractors, or home-builders that you need to work with. Get reviews and referrals from your friends, colleagues, and family members to ensure you have the right team for the developing job!
Similarly, ensure that you’re taking out a construction loan from a reliable and credible lender. An experienced lender will create flexible loan terms for you and ensure that your raw land develops into the property of your dreams!
Partner with Commercial Private Equity to Develop your Raw Land
We know that the lack of funds can further stretch your property development process. But with Commercial Private Equity, our clients can rest assured that their raw land development will go according to their scheduled plans!
Head to our website to get more details about our construction loan program in the United States.