When looking to develop property there several things that you have to keep in mind that will determine the efficiency and cost of your project. Looking at several aspects such as land, location and zoning are pivotal points that can determine a lot in our development.
When looking at the land the zoning will determine what you are allowed to build in that specific area. Zoning will tell you how much you will be able to build and the conditions in that you will be able to build this. Additionally, this will be different in every city and county as these have a different set of codes for buildings. Depending on where you are you will be able to build different
This is where finding the land that you want to purchase will be essential because it will determine how profitable your project is. Some of the things to keep in mind are checking for soil contaminants or other building hazards such as floods, fires, and here in California earthquakes.
2. Due Diligence
Doing due diligence is crucial for any developer before commencing anything. There are tools such as Terrakan that allows you to search for properties in LA county to gain a feasibility report on the maximum buildable area for your project.
Additionally, you would have to analyze the current state of the plot of land. This would mean seeing there are utilities in place or having a viable option to have this done. When looking at a piece of land to build on, you would also want to see if the land is on a slope or if it is a flat piece of land. Having a slope land will result in a more costly development project.
Another crucial step in getting your development underway is being able to get permits approved and underway. Getting permits approved may take weeks or even months especially since COVID-19 has slowed the process. This will be a crucial part of getting your project to stick to its timeline. Additionally, if your application is incomplete it will be returned for you and will need to get filed again causing delays in your permit process.
In California, you are allowed to build a detached accessory unit that is up to 120 feet that don't require electrical wiring. Building an ADU requires you to have a permit and it can be up to 1,200 sqft according to the Housing and Community Development. In Los Angeles, the number of ADUs that received building permits was 11,874. Furthermore, the cost per square foot to build an ADU ranges from $314-$370 according to symbium.
4. Development Costs
Assessing and creating a financial plan will be essential to avoid any budget issues once your project is underway. If your property has a building that needs to be torn, this will cost you more as well for the demolition. In addition to this, you will need to have the right developer that will execute your vision determined on agriculture style, materials, and budget to be able to have your project on track the entire time.
The development cost to build a house in California is around 1.35 million dollars for a property of about 2,700 sqft. A grand majority of the costs to build a house will come just from materials.
Building a property is a tedious process but doesn't have to be if you got the right tools. The Code Solution can help you with your project by having the A - Z solution. Our multidimensional approach ranges from Acquisition & Due Diligence, Development Strategy, Financial Strategy, Entitlements & Expediting, Architecture & Design, and Construction Management. Ranging from multifamily, single-family, adu’s, and commercial properties, The Code Solution has the right team with over 30 years of experience knowing the right way to get your project done.
#realestatedevelopment #realestateinvesting #Homebuilders