I have a question about a farm up for sale - Posted by H Jason Dollar

Posted by Irwin on June 10, 1999 at 05:52:18:

I have only been involved in ours for since last fall. The prior owner started the platting process more than a year before that. We should have final approval to begin putting in the interior road and start selling lots next week. As I said, every county in the country has different criteria. You just have to know what yours are, and plan your financing accordingly.

I have a question about a farm up for sale - Posted by H Jason Dollar

Posted by H Jason Dollar on June 08, 1999 at 02:58:26:

in my area. The farm has two(3/1)houses ( need some rehab) and 6.8 acres. They are asking 260,000 dollars, which may or may not be good, as I found out that subdivison lots in that area of Chattanooga TN, go for 15-25k apiece, and that one can probably subdivide it into 12 lots, then sell off the lots to builders, thus generating the cash needed to fix up the two farm houses, then sell them. What is sort of a twist to this deal is that in one of the houses, one of the sons of the estate now lives, and would apparently like to continue, because they also said they wouldn’t mind taking 160k for just the other house and 5 acres.
My question(s) is (are):
What kind of lender should I get for the money needed to purchase said property?
What offer should I make, without totally offending the sellers, who are 5 siblings with an estate that needs selling. I was thinking maybe 200k for the entire farm, and maybe 110k for just the acreage and the other house, which btw, is not fronting the road, but is back in the woods, via a paved road. Does anyone have any experience in subdividing? Anyone like to share? I am trying to do a get-in, fix-up, get-out deal, but don’t have any experience with subdivision lots, and am unsure how to treat the acreage.
And finally, if one of the children wants to continue in the house that is fronting the road, is this really an indication of a motivated seller?

Re: I have a question about a farm up for sale - Posted by marla

Posted by marla on June 10, 1999 at 13:58:45:

H Jason,

The first thing I’d check is whether or not you can subdivide the acrage without having to get it rezoned. The rezoning process and be lengthy and not without cost.

If the zoning supports the subdivision, you’ll still have to go through all the steps that Irwin talks about. For the county where I have some developable property in Oregon (already zoned for high-density residential), first plat approval takes about nine (9) months. I’d need to get an engineering firm on retainer (approximately $10K) and pay about $5 - 10K in fees just to get to first plat approval.

For me, it’s not the above costs that get in the way. It’s the land use approval process for the county … you need to know what you’re doing. mistakes in the process can cost you lots of time and money. If I develope it myself, I’ll look for a partner with experience in the local process.

This in not to say you shouldn’t follow up on the possibilities of developing this property. (That’s were some real money can be made.) It may not be so difficult in your area. Just wanted to point out that it can be a lenthy/costly process, even when you’ve got the right zoning.

I wish you success!
Marla (Santa Clara, CA)

Re: I have a question about a farm up for sale - Posted by Irwin

Posted by Irwin on June 09, 1999 at 22:45:04:

I can tell you that subdividing land and selling residential lots is a lot easier said than done.
For advice on this, start out with the county planning and zoning people. They’ll tell you how much bureaucratic red tape you’ll have to go through. There’s highway, survey, engineering, drainage, health and perhaps other departments that all have to be satisfied with the plans. I started working on one last fall. We still are a signature or two short on our construction plans. With luck we’ll have it all together by next week. It’s in a very picky suburban area though. Perhaps your county and township won’t be that tough or slow acting.

Re: I have a question about a farm up for sale - Posted by H. Jason Dollar

Posted by H. Jason Dollar on June 10, 1999 at 03:11:43:

Thanks for your response. I talked to a surveyor, but he didn’t mention the highway, engineering, and drainage departments. Approximately how long is yours taking, if you don’t mind me asking? 2 months? or longer (heaven forbid)