The process of entitling lots may take more or less than 5 years and at the same time, it can cost you significant sum of money. It can already run you at around 100000 already for the cost of parcel maps for 5 lots or less. Tract maps for greater than 5 lots on the other hand may cost you more than half a million. The potential size as well as number of lots are then determined by health department regulations, zoning and general plan as well as biology. In this cost, included are processing, regulatory fees, engineering and several other studies and reports.
Studies and reports at the same time include storm water treatment, approval cost, archeology and anthropology, soils, biology, traffic and noise. As soon as the map is approved and recorded, there are various fees that need to be settled including but not limited to potential greenhouse gas studies, on and off site mitigation land, school fees, recreation and park fees, physical secondary access, annual bonding fees, fire fees and drainage and retention basins.
Politics then come into play when you are trying to acquire the approvals required from city councils, county boards as well as planning commissions. The level of support or opposition will affect the hearing completion. As a matter of fact, it can be done in short as 4 months or even take years and could cost to over millions of dollars. For this, property owners have 3 options to take into mind and these include:
Number 1. Sale and entitlement of the property as is – in such option, it brings the lowest price but costs the least and requires shortest time for disposal of property. The land has higher value when it is not titled on rare circumstances.
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Number 2. Enter into long term agreement – for this option, the agreement is made with home builder who has incurred the expense of processing the tract map. As a matter of fact, this option is the more preferred by many but the process may take up to 5 years. Aside from that, it is important for the buyer to periodically release nonrefundable deposits to the seller after approving contingencies. For the escrow closing, this normally takes place after the final or tentative map approval.
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Number 3. The owner will incur the cost of entitlement – most of the process is the second option but the difference is that, the owner is bearing all expenses and has better control of the mapping. As for the ramifications for every choice, it should be done carefully and be weighed before you come up to a decision, which is also crucial in an effort to avoid getting into problems down the road.