Buying land in subdivision, but build house from scratch

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
Post Reply
User avatar
Topic Author
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Buying land in subdivision, but build house from scratch

Post by sunny_socal »

We're thinking of buying some land in a nearby subdivision, it's brand new and no roads even exist yet. But it will feature:
- 5 Acre lots
- Roads, mailboxes provided
- Electric, high speed internet (at the curb)
- Water well required, not provided
- Septic required, not provided
- Propane required, not provided
- HOA with some restrictions

Prior to this we'd always bought an existing home but now we're thinking of building our 'forever home.' (Is it really forever? No idea)

The developer basically bought a 500 acre ranch and subdivided it into tracts. They're selling those tracts for 200-300k each. They will not build or otherwise be involved other than perhaps providing some referrals.

What are getting into? We figure the land would cost about $250k and that it would take about a year to build, especially given the very high demand for development out here in central TX. We could potentially scrape up enough cash if we liquidated all our non-retirement accounts but in reality we'd probably just pay 20% down and finance the rest @ 5% rate. Later I guess we'd obtain a construction loan, and later still convert that to a regular mortgage. We still have one kid in school (starting Jr year in HS) so we would like to wait until he's done to actually move, we may spend a year planning and start building after that.

There is no neighborhood yet but the HOA rules indicate that it would be a 'nice' area:
- Rain collection tanks encourage but they must be wrapped in wood or stone
- RV Storage allowed but they must be in enclosed building. Those buildings may be metal sheds but must be surrounded by 3ft high rock wainscoating and there must be landscaping on the side facing the street.
- In-ground pools only, no above ground pools
- Guest houses allowed, but no use for Air-BNB or any other rental
- No parking on subdivision streets, ever, for any reason

What additional cost should we expect?
- Architect
- Building the house, of course
- Install Septic
- Install electric from street to house
- Install propane tank
- Driveway/road all the way to house
- Landscaping, irrigation
- Water well

It seems like a lot to bite off, but nonetheless that subdivision will likely be sold out in 6 months. We're being told that we should pick at lot this weekend if we want one, they won't last.

Thanks
livesoft
Posts: 86076
Joined: Thu Mar 01, 2007 7:00 pm

Re: Buying land in subdivision, but build house from scratch

Post by livesoft »

I would not even entertain the idea.

The HOA rules can be changed by the residents and with no current residents who knows what they will be in 10 years.

I live in a place where I know all my neighbors and they know me. I know all their children, too. I talk with my neighbors regularly and we all help each other out, too. Our lots are not larger than half an acre.
Last edited by livesoft on Fri Apr 30, 2021 3:50 pm, edited 2 times in total.
Wiki This signature message sponsored by sscritic: Learn to fish.
badger42
Posts: 614
Joined: Thu Apr 09, 2015 9:01 am

Re: Buying land in subdivision, but build house from scratch

Post by badger42 »

5 acres with no city services AND a HOA? Sounds like the worst of both worlds.

I would pass purely due to the HOA. If I'm going to live on acreage I don't want a bunch of busybodies measuring my grass or complaining about colors of paint or the wrong mailbox.
Helios
Posts: 45
Joined: Mon Nov 25, 2019 7:43 pm

Re: Buying land in subdivision, but build house from scratch

Post by Helios »

My first thot is that the developer has promised quite a bit.

I would want to know if he has previous developments that I could see.

If you proceed, a general contractor can make all of those requirements, that is what they do.

I realize that you feel time limited, however, if this project builds out as promised, there will be others that will want to emulate.
User avatar
Watty
Posts: 28860
Joined: Wed Oct 10, 2007 3:55 pm

Re: Buying land in subdivision, but build house from scratch

Post by Watty »

sunny_socal wrote: Fri Apr 30, 2021 3:10 pm - Water well required, not provided
- Septic required, not provided
What happens if the water or septic is more difficult that planned for? If you were going to build right away you might be able to make the contract contingent on the water and septic not having problems but if you will not be building for a couple of years there might not be much recourse if there is a problem with the well or septic. Rules can also change and there is a risk that what is allowed today might not be allowed when you are ready to build.

I don't know much a ground water but if there are a hundred new lots and a hundred new wells then what sort of impact will that have for the water supply ten years from now?
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm ....it's brand new and no roads even exist yet.
Be sure to have a lawyer involved to be sure you will be protected if the roads are never built. If the developer goes bankrupt then you could be trouble.
texasdiver
Posts: 3937
Joined: Thu Jun 25, 2009 12:50 am
Location: Vancouver WA

Re: Buying land in subdivision, but build house from scratch

Post by texasdiver »

Central Texas. So I'm guessing somewhere in the greater Austin area?

Water could be a major problematic issue if you need to drill your own well.

Sounds like you want to buy the land and sit on it for a spell. Nothing particularly wrong with that. But honestly, rural land in Central TX is not exactly in short supply compared to places like California. There is virtually no public land or protected land in that part of Texas. So there will always be new subdivisions. And there will always be older ones with lots available or homes available for renovation.

It sounds like some of the exurban subdivisions around Waco where we used to live. They all had HOAs. Some were better than others. I would personally rather buy into an existing neighborhood that is stable and established rather than roll the dice and hope some new one turns out like you expect.
texasdiver
Posts: 3937
Joined: Thu Jun 25, 2009 12:50 am
Location: Vancouver WA

Re: Buying land in subdivision, but build house from scratch

Post by texasdiver »

5 acres is nothing in exurban Texas. Lots of ordinary subdivisions meet that criteria and are perfectly decent places to live. We lived in one outside Waco for a spell until the commutes got too long. This is what a 5 acre lot HOA subdivision looks like in the greater Waco area. Not my cup of tea, but not meth heads growing pot and shooting off their guns all hours of the night either: https://www.zillow.com/homedetails/290- ... 0568_zpid/
Last edited by texasdiver on Fri Apr 30, 2021 3:58 pm, edited 6 times in total.
User avatar
ResearchMed
Posts: 16795
Joined: Fri Dec 26, 2008 10:25 pm

Re: Buying land in subdivision, but build house from scratch

Post by ResearchMed »

badger42 wrote: Fri Apr 30, 2021 3:27 pm 5 acres with no city services AND a HOA? Sounds like the worst of both worlds.

I would pass purely due to the HOA. If I'm going to live on acreage I don't want a bunch of busybodies measuring my grass or complaining about colors of paint or the wrong mailbox.
I would especially NOT do this without having the opportunity to review the FULL and FINAL HOA docs.
Who knows what could get inserted...?

And if there aren't already any utilities/services in the area... what's the chance there is some sort of snafu in arranging those, be it regulatory, practical, or financial?

I think it's a bit early unless you are yourself a developer who knows how to handle these things, and even then, did I mention the HOA? Or what if there's a problem with the services...?

Is there some sort of rush or a reason why it must be this particular development (that doesn't seem to be quite developed yet)?

RM
This signature is a placebo. You are in the control group.
oldfatguy
Posts: 1434
Joined: Tue Feb 27, 2018 12:38 pm

Re: Buying land in subdivision, but build house from scratch

Post by oldfatguy »

badger42 wrote: Fri Apr 30, 2021 3:27 pm 5 acres with no city services AND a HOA? Sounds like the worst of both worlds.

I would pass purely due to the HOA. If I'm going to live on acreage I don't want a bunch of busybodies measuring my grass or complaining about colors of paint or the wrong mailbox.
+1
That's my take as well.
User avatar
Topic Author
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Re: Buying land in subdivision, but build house from scratch

Post by sunny_socal »

Thanks for the feedback. Addressing some points:
- The HOA is no big deal, I think. Out here if land is "unrestricted" is means someone can set up an RV park next door or open a pet hotel. And this does happen. An HOA is the only way to guarantee that someone won't do something silly with their land.
- The HOA is usually specified and run by the developer for a period of time. Then it is transitioned over to the residents. I don't expect big surprises here either.
- The developer is well known and we've seen their other communities. They are top notch, I'm confident we'll see those roads built unless we sprial into hyper-inflation in the next 6 months.
- The water is a question mark, yes. No idea what will happen in the next 10 years. But even municipal water companies start to ration supply if things get difficult.

Called the bank, here's now it works:
1) You give the developer 10% down when you sign the contract
2) The loan closes in 30 days, you bring another 10% to bring the total to 20%
3) It is a 5-yr balloon loan with a 20yr amortization. By that time you should have your house built.
4) They also do construction loans that are interest-only and you pay on the amount you have drawn. The builder may draw in 50k chunks for example, you pay for that as the building proceeds. Construction take 6-12M depending on contractor and what you're building (house, guest house, barn, pool, shed...)
5) Eventually your new house is done. Either sell your old house or rent it out to cover the cost of the new place.
whr19606 wrote: Fri Apr 30, 2021 3:39 pm I must take issue with livesoft's post and it's denigrating stereotype of people who prefer to live in less-crowded areas. If his post is allowed to stand, I shall assume that the floodgates for insults have been opened.
I'm not taking it personally - he probably lives somewhere outside TX. Many of our friends have 20 acres or more, people here just like "elbow room" :wink:
mkc
Moderator
Posts: 3291
Joined: Wed Apr 17, 2013 2:59 pm

Re: Buying land in subdivision, but build house from scratch

Post by mkc »

Watty wrote: Fri Apr 30, 2021 3:37 pm
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm - Water well required, not provided
- Septic required, not provided
What happens if the water or septic is more difficult that planned for? If you were going to build right away you might be able to make the contract contingent on the water and septic not having problems but if you will not be building for a couple of years there might not be much recourse if there is a problem with the well or septic. Rules can also change and there is a risk that what is allowed today might not be allowed when you are ready to build.

I don't know much a ground water but if there are a hundred new lots and a hundred new wells then what sort of impact will that have for the water supply ten years from now?
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm ....it's brand new and no roads even exist yet.
Be sure to have a lawyer involved to be sure you will be protected if the roads are never built. If the developer goes bankrupt then you could be trouble.
Having built (twice) in Texas, issues with adequate supply/ability to tap into an aquafer in central TX is a reality. It could be a major issue.
One of the neighborhoods we lived in prior to our first build had issues with most wells running dry a couple of times, with subsequent drilling of new, deeper wells (and adding large holding tanks) a necessity. Significant usage restrictions were common when we lived in the Austin area. An irrigation system can put a hefty demand on a well, so you will likely need a large holding tank (in an enclosed building somewhere) to supply it. We had the latter, irrigating just 1/3 acre around our house that was on 20 acres. We had a 2500 gallon holding tank.

Depending on which side if I35 this is, you could be looking at perc issues requiring engineered OSSF septic. These are more costly, and require quarterly inspections and maintenance, with inspections reported to the county health department. They are more costly to own and operate than traditional tank and field.

Many subdivisions like this have a time limit on lot purchase vs when you build. Does this community and does it fit your plan?

Many subdivisions like this require you to use one of their builders. Does this community? If so, do you like their builders' work?

Many subdivisions like this have covenants and restrictions, with minimum sf building sizes. Does this suit your empty-nest situation once you build? (e.g. would you have to build a 4000 sf house when you'll only need 2500 sf)?

How do you feel about mowing/pruning/etc. 5 acres every week?

What do they define as "high speed internet"? Is it fiber? Will you be tied to a single provider (the one who installs the infrastructure)?

Since there is no "city" water, how far away will the closest hydrants be and how are they supplied? This will impact your insurance cost.
adestefan
Posts: 581
Joined: Fri Jan 06, 2017 7:22 pm

Re: Buying land in subdivision, but build house from scratch

Post by adestefan »

An HOA that prohibits parking on the street. No way.

Plus you’re getting stuck with all the risk (water, building, interest rate changes, etc.) and none of the reward. Sounds like the developer is making out more than anyone in this situation
SwampDonkey
Posts: 321
Joined: Sun Dec 26, 2010 7:49 pm

Re: Buying land in subdivision, but build house from scratch

Post by SwampDonkey »

adestefan wrote: Fri Apr 30, 2021 8:46 pm An HOA that prohibits parking on the street. No way.
This is actually one of my favorite rules in our HOA. It keeps our streets from being riddled with tons of parked cars and makes it easier to drive around and through (and easier access for emergency vehicles). It's also easier to see kids playing in the front yards/sidewalks.
Compared to the otherwise-similar nearby neighborhoods that allow street parking, the overall "feel" of our neighborhood is higher.

With that said, for families that have too many cars to park in their garage/driveway... I understand their frustration with the policy.
WhyNotUs
Posts: 2610
Joined: Sun Apr 14, 2013 11:38 am

Re: Buying land in subdivision, but build house from scratch

Post by WhyNotUs »

I do not live in Texas.
The states that I have lived or worked in all required developers to prove adequate water supply before subdivision, usually by providing a well, for what I think are obvious reasons.
Apparently in Texas, in most areas, one can create a subdivision of lots of 5 acres or more without proving adequate water supply.
That alone would make this a no go for me.
Good luck.
I own the next hot stock- VTSAX
DoubleComma
Posts: 2066
Joined: Sun Aug 23, 2020 2:23 pm

Re: Buying land in subdivision, but build house from scratch

Post by DoubleComma »

SwampDonkey wrote: Fri Apr 30, 2021 9:04 pm
adestefan wrote: Fri Apr 30, 2021 8:46 pm An HOA that prohibits parking on the street. No way.
This is actually one of my favorite rules in our HOA. It keeps our streets from being riddled with tons of parked cars and makes it easier to drive around and through (and easier access for emergency vehicles). It's also easier to see kids playing in the front yards/sidewalks.
Compared to the otherwise-similar nearby neighborhoods that allow street parking, the overall "feel" of our neighborhood is higher.

With that said, for families that have too many cars to park in their garage/driveway... I understand their frustration with the policy.
Agree, me too. I also really like the rule in our neighborhood where boats, RVs, Trailers etc must be stored behind a fence and not visible from the road.

The requirements described in the HOA the OP is considering sound reasonable to me. Not all HOA are bad, especially when neighbors are neighborly.
bloom2708
Posts: 9861
Joined: Wed Apr 02, 2014 2:08 pm

Re: Buying land in subdivision, but build house from scratch

Post by bloom2708 »

With material costs, shortages of many things this could be massively more expensive than the OP thinks.

This would be 101 on my top 100 list of things to tackle.
User avatar
Topic Author
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Re: Buying land in subdivision, but build house from scratch

Post by sunny_socal »

mkc wrote: Fri Apr 30, 2021 8:31 pm
Watty wrote: Fri Apr 30, 2021 3:37 pm
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm - Water well required, not provided
- Septic required, not provided
What happens if the water or septic is more difficult that planned for? If you were going to build right away you might be able to make the contract contingent on the water and septic not having problems but if you will not be building for a couple of years there might not be much recourse if there is a problem with the well or septic. Rules can also change and there is a risk that what is allowed today might not be allowed when you are ready to build.

I don't know much a ground water but if there are a hundred new lots and a hundred new wells then what sort of impact will that have for the water supply ten years from now?
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm ....it's brand new and no roads even exist yet.
Be sure to have a lawyer involved to be sure you will be protected if the roads are never built. If the developer goes bankrupt then you could be trouble.
Having built (twice) in Texas, issues with adequate supply/ability to tap into an aquafer in central TX is a reality. It could be a major issue.
One of the neighborhoods we lived in prior to our first build had issues with most wells running dry a couple of times, with subsequent drilling of new, deeper wells (and adding large holding tanks) a necessity. Significant usage restrictions were common when we lived in the Austin area. An irrigation system can put a hefty demand on a well, so you will likely need a large holding tank (in an enclosed building somewhere) to supply it. We had the latter, irrigating just 1/3 acre around our house that was on 20 acres. We had a 2500 gallon holding tank.

Depending on which side if I35 this is, you could be looking at perc issues requiring engineered OSSF septic. These are more costly, and require quarterly inspections and maintenance, with inspections reported to the county health department. They are more costly to own and operate than traditional tank and field.

Many subdivisions like this have a time limit on lot purchase vs when you build. Does this community and does it fit your plan?

Many subdivisions like this require you to use one of their builders. Does this community? If so, do you like their builders' work?

Many subdivisions like this have covenants and restrictions, with minimum sf building sizes. Does this suit your empty-nest situation once you build? (e.g. would you have to build a 4000 sf house when you'll only need 2500 sf)?

How do you feel about mowing/pruning/etc. 5 acres every week?

What do they define as "high speed internet"? Is it fiber? Will you be tied to a single provider (the one who installs the infrastructure)?

Since there is no "city" water, how far away will the closest hydrants be and how are they supplied? This will impact your insurance cost.
Thank you for your feedback.

Yesterday we visited one of the other communities sold by the same developer, that place is already "sold out." It was indeed beautiful but we only saw about six houses built in an area of ~500 acres. Several neighboring properties just outside that new community had signs out front saying "No water available" or "No sweet water since 1976." It was weird. We didn't talk to anyone but my hunch is that there are indeed some issues with the water table and the locals are reacting to the community being built right next to them.

Someone mentioned fire hydrants, didn't look for any. Some of the roads appeared to be paved but not really in the same sense as our current suburb. Here we have concrete curbs and gutters and of course hydrants. At that other community we visited there was some kind of tar based surface but it wasn't smooth, it looked like packed gravel. No curbs, no gutters.

I'm on the fence, slightly leaning "No" on this project. Yes it's an opportunity but we'd be reaching. I'll bet most people buying those lots are "investors" who have no intention of building. They'll pay cash and sit on the land for a few years and then sell after prices have gone up.
Jack FFR1846
Posts: 18501
Joined: Tue Dec 31, 2013 6:05 am
Location: 26 miles, 385 yards west of Copley Square

Re: Buying land in subdivision, but build house from scratch

Post by Jack FFR1846 »

$200k for an undeveloped 5 acre lot where the seller has done nothing besides drawn up development plans and created an HOA? Who is going to build the roads? To me, the price is outrageous, but maybe that's because I live in the low cost Boston suburbs (sacrasm).

Every area is different, but where I am, building new the same exact house that mimics an existing house costs at least 50% more. How is is where you are planning to build? What builders here do to make their houses look cheaper is that they quote prices with contractor carpet, lights, outlets, no gutters, no paved driveway, no lawn, no plants. All the "upgrades" are available at unreasonably high prices.

5 acres is a nice building lot size. Not big and not a postage stamp. What's the land like? Is it barren land with no trees or is it being cut from a forest? Is there opportunity to use the land for other uses? I'd think not with the existence of a HOA. I'm able to forest manage my little 13 acre lot, reducing my property taxes and heating my house. Can you do anything like that? Farmer rental?

Can you instead buy your own large lot of land and do your own work and engineering? I would expect that the cost would be much, much cheaper and your ability to do whatever you want could greatly reduce your cost and increase your freedom.
Bogle: Smart Beta is stupid
mkc
Moderator
Posts: 3291
Joined: Wed Apr 17, 2013 2:59 pm

Re: Buying land in subdivision, but build house from scratch

Post by mkc »

sunny_socal wrote: Sat May 01, 2021 7:00 am
Yesterday we visited one of the other communities sold by the same developer, that place is already "sold out." It was indeed beautiful but we only saw about six houses built in an area of ~500 acres. Several neighboring properties just outside that new community had signs out front saying "No water available" or "No sweet water since 1976." It was weird. We didn't talk to anyone but my hunch is that there are indeed some issues with the water table and the locals are reacting to the community being built right next to them.
Definitely a red flag and highly likely there are water issues. If you haven't lived in central Texas long, you may not be aware that it is a definite challenge.
Someone mentioned fire hydrants, didn't look for any. Some of the roads appeared to be paved but not really in the same sense as our current suburb. Here we have concrete curbs and gutters and of course hydrants. At that other community we visited there was some kind of tar based surface but it wasn't smooth, it looked like packed gravel. No curbs, no gutters.
So chip and seal. Basically they spray oily tar down and then dump gravel on it and roll. Are these considered private roads? Who is going to maintain them?

Regarding hydrants, if there's no community well for those, then there likely aren't any. What's the plan for fire? How far away is the closest fire station and what's the water source?
I'm on the fence, slightly leaning "No" on this project. Yes it's an opportunity but we'd be reaching. I'll bet most people buying those lots are "investors" who have no intention of building. They'll pay cash and sit on the land for a few years and then sell after prices have gone up.
Or be stuck with unsellable lots if there is a water issue discovered or after there's no longer a developer around and the homeowners are on their own to maintain the properties. What's in the HOA docs as far as mowing/maintaining vacant lots, particularly during fire season?
Last edited by mkc on Sat May 01, 2021 7:54 am, edited 1 time in total.
Nowizard
Posts: 4842
Joined: Tue Oct 23, 2007 5:33 pm

Re: Buying land in subdivision, but build house from scratch

Post by Nowizard »

We have had a rural subdivision home with septic, but not propane. It sounds like the developers are capitalizing on the current market, and I suspect they are focusing on leaving it "natural," meaning none, or limited street lights, no sidewalks, etc. unless these are requirements until full utilities can be provided. Depending on location, trash is an issue, water, etc. Sounds like it would be a nightmare when you add in having your own home built for those of us who are older or who have lived with some of the deterrents, along with the benefits, of what you describe. However, that is why there are so many choices with things. The main point is to consider the practical and emotional factors. We moved "into town" a year ago, a move of about six miles. That is not very far, but the access to banks, grocery stores, big box stores, less travel to see friends is tremendous for us.

Tim
The Stone Wall
Posts: 159
Joined: Thu Mar 22, 2018 1:18 pm

Re: Buying land in subdivision, but build house from scratch

Post by The Stone Wall »

If city water is not available, you won't find any fire hydrants. You can look at well drilling reports at the Texas Water Development Board site. You should look at every well drilling log in the area around this site. The main things to look for are the depth of the wells, the gallons per minute of the wells (I wouldn't want anything less than 50 gpm), the water thickness, and the aquifer type. If you continue to strongly consider this purchase, you may want to call one of the drilling firms (listed on all of the drilling logs) and ask about the aquifer potential.
MarkBarb
Posts: 908
Joined: Mon Aug 03, 2009 11:59 am

Re: Buying land in subdivision, but build house from scratch

Post by MarkBarb »

We did something similar in Oklahoma about 20 years ago, but with 1.5 to 2 acre lots. Having grown up in the suburbs (1/4 acre lots), I thought I would love having the extra space. After living their for a while, my feelings were mixed. It was nice to have more room, but overall, I didn't like it.

The biggest problem I found was the social dynamic. The density was too low for my tastes. It felt like we were living in an area that happened to have other people living there rather than living in a community. We hardly interacted with anyone other than the few neighbors closest to us. We also had young kids (2 and 5) and play dates were a much bigger challenge because there were so many fewer kids and they were so far apart. The low density in the area also meant that it was farther to stores, schools, etc. Everybody is different, but for me, I prefer traditional suburban communities over "acreage". So if it is a significantly different population density than you are used to, think carefully about that aspect of it.

And just because so many people have dumped on HOAs, I thought I'd add that I like them and would be cautious about living in an area without one. I don't want my street constantly clogged with parked cars. I don't want my neighbor to have his "project car" in pieces on his front lawn. I don't want the people across the street to open up a busy massage business with strangers coming by every hour. There are times I'm annoyed by the restrictions of the HOA, but I accept them as an acceptable trade-off to keep my neighbors from getting to annoying. There is a good reason that HOAs exist and that property values in neighborhoods with them are higher than in neighborhoods without them. And where I live, there is no zoning, so an HOA is even more important. But I'm also happy that people can build houses in areas without them so we can all get we want. Except for my one friend that decries the fact that you can't get a house in a "nice" neighborhood that doesn't have an HOA.
carolinaman
Posts: 5463
Joined: Wed Dec 28, 2011 8:56 am
Location: North Carolina

Re: Buying land in subdivision, but build house from scratch

Post by carolinaman »

Watty wrote: Fri Apr 30, 2021 3:37 pm
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm - Water well required, not provided
- Septic required, not provided
What happens if the water or septic is more difficult that planned for? If you were going to build right away you might be able to make the contract contingent on the water and septic not having problems but if you will not be building for a couple of years there might not be much recourse if there is a problem with the well or septic. Rules can also change and there is a risk that what is allowed today might not be allowed when you are ready to build.

I don't know much a ground water but if there are a hundred new lots and a hundred new wells then what sort of impact will that have for the water supply ten years from now?
sunny_socal wrote: Fri Apr 30, 2021 3:10 pm ....it's brand new and no roads even exist yet.

Be sure to have a lawyer involved to be sure you will be protected if the roads are never built. If the developer goes bankrupt then you could be trouble.
We built our home on 2 acres in suburbs (country then) 47 years ago. Had difficulty getting ground to perk but have not had any problems with septic tank. It took 3 holes to find water, 300 ft deep well at 4 gallons a minute. That was very expensive then and I hate to think what the cost would be today. We were very limited in water usage and sometimes lost prime on well. One time had to redrill the well due to stones clogging it (drilling rig cost $600 an hour). It was a happy day when we were able to connect to city water many years later. This was in NC which has an abundance of water. Not sure if the area of Texas is similar but you need to check out the water table.

5 acre lots is very appealing neighborhood but there are definite risks to this venture. Do your research before jumping into this. Talk with the county to understand abundance of water and septic issues. I would not be coerced into buying before I was ready.
Shallowpockets
Posts: 2533
Joined: Fri Nov 20, 2015 9:26 am

Re: Buying land in subdivision, but build house from scratch

Post by Shallowpockets »

I would not do this venture. It sounds like a money and time sink. Too many unknowns, even after you think you know. Sometimes when you are in for the penny you then are most definitely in for the pound. At some point in such a project there is no going back. I see it as multiples of thousands, not hundreds. And not far off tens of thousands, in increments of unknown costs coming to the forefront.
That is just the money because you will also be investing huge amounts of time simply researching it and then the time on each and every step of the way.
User avatar
Topic Author
sunny_socal
Posts: 2732
Joined: Tue Mar 24, 2015 4:22 pm

Re: Buying land in subdivision, but build house from scratch

Post by sunny_socal »

Well the developer called and said the entire project is "sold out" now - that's less than 12 hours after the official release. 100 lots of 5 acres each.

My hunch is that regular people weren't really in the running anyway. I'll bet a year from now I can drive through there and find only a handful of homes. "Investors" with some money know they can sit on those lots for a few years and make a decent profit. Lots will still be available but only on the resale market. The developer will now buy up another 500 acre ranch nearby and chop it up.

This is happening all over this region. Properties have land handed down through generations but the granparents/parents have passed away and the younger people don't know what do with it. A developer walks up and offers some cash and they decide to take it.
Last edited by sunny_socal on Sat May 01, 2021 3:34 pm, edited 1 time in total.
frequentT
Posts: 184
Joined: Sat Jan 28, 2012 3:06 pm

Re: Buying land in subdivision, but build house from scratch

Post by frequentT »

Lucky outcome!

Wow! I can't imagine such a purchase with so many unkowns. You would have to be a real risk taker.
WhyNotUs
Posts: 2610
Joined: Sun Apr 14, 2013 11:38 am

Re: Buying land in subdivision, but build house from scratch

Post by WhyNotUs »

sunny_socal wrote: Sat May 01, 2021 2:14 pm The developer will now buy up another 500 acre ranch nearby and chop it up.
Any idea what happens to the water rights from the ag operation?
In many areas, as irrigation is eliminated for ag uses the groundwater recharge is diminished. Sometimes property owners will sell the water right separately and other times they will remain for outdoor irrigation.
I own the next hot stock- VTSAX
Broken Man 1999
Posts: 8626
Joined: Wed Apr 08, 2015 11:31 am
Location: West coast of Florida, near Champa Bay !

Re: Buying land in subdivision, but build house from scratch

Post by Broken Man 1999 »

When I was a lad, there was a forested area on a road we used frequently. The forest had once been a cleared piece of land, complete with beautiful entry columns on either side of the entry point.

My father knew the land's history and told me the piece of property had been platted during the late 1920ties, right before the RE collapse in Florida and the Depression.

When I moved to the West Coast of Florida in 1971, the land was still being reclaimed by nature. I know for many visits back home thru the years, it hadn't changed. The next time I visit I will make it a point to see if it has been developed. It definitely sat vacant for at least 50 years I am sure of.

The land had paved road footage, utilities passing by it.

Although I would certainly pay more later if I were a buyer of property described by OP than if buying now, I think it would be a better gamble than being one of the early purchasers.

No way would I want to trust how such a RE undertaking might pan out, unless I had very deep pockets and had bought for strictly speculative reasons.

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go." - Mark Twain
Post Reply