British Columbia Real estate tips
Land assembly is the joining of adjacent lands to create a larger parcel. Typically, this is done to develop a project that is larger than the size of the property before the assembly. Parceled land sells at a higher price than if selling it in pieces to individual buyers, as this opens the market for large developers to purchase the assembly.
If you’re looking to develop a land assembly, it’s important to note as much information as possible about the land and what is permitted in the Official Community Plan for the neighborhood. Considerations include how much land is being assembled, how challenging it will be to acquire the smaller pieces of land, what you’re aiming to develop, and the time frame for your proposed british columbia real estate development.
To secure financing for your project, whether that be through Finpedient’s network or traditional lending sources, you’ll have to conduct appropriate market research, figure out how to market the development, find the partners you’ll be working with to get the project done and convince the individual land buyers to sell their parcels. This is a legally sensitive initiative and you may need a lawyer. The lawyer has to take the time to read and understand them to properly advise you.
There are ways to move forward with the British Columbia Real Estate development without outright purchasing the land through the use of “subject conditions,” which are terms that make the contract binding with the owner of the area you intend to buy only when they are removed. This is standard protocol for savvy developers, allowing them to tie up property so they can’t sell to another party.
Typical subject conditions are:
• A certain number of neighborhood owners signing on;
• Satisfactory Phase I environmental site assessment;
• Satisfactory Feasibility Study;
• Other due diligence searches and investigations such as title review, soil sampling, site assessment, etc.
Going through these subjects can frequently take more 6 months to complete. While the terms are pending, the property can’t be sold to another party, and it’s unlikely that the property owner is looking to renovate or upgrade the home with the possibility of a sale on the horizon.
While these are favorable terms to the BC real estate developing agency, it is in the seller’s best interest to have the property under contract for as short a time as possible and to attain non-refundable compensation from the developer if the property is going to be tied up for 3-4 months.
Other Considerations Are
It may be a while before your development breaks ground. In this case, it may be a selling point to offer the property owner to rent back the house. The property will still be livable, and it’s prudent to ensure the individual property is generating revenue which ranges between $24,000 to $50,000 depending on the type of property, size of the house, and the location.
Conclusion
With 40,000-50,000 people moving to the Lower Mainland yearly and the political mandate to increase housing density, there may be opportunities for a savvy businessman to create land assemblies and generate wealth, whether by building his own development or selling the assembly to someone else who has the expertise.