When Should You Rezone or Subdivide a Property (LA 1256)
Transcript:
Steven Butala:
Steven and Jill here.
Jill DeWit:
Hello.
Steven Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.
Jill DeWit:
I'm Jill Dewitt broadcasting from sunny Southern California.
Steven Butala:
Today, Jill and I talk about when should you rezone or subdivide a piece of property?
Jill DeWit:
Well, I have a lot of really good examples. You like that? I hope you have a pen and paper handy.
Steven Butala:
The thick of it is this. It's really difficult to rezone property, and I'll hear stories about it. It's like a unicorn.
Jill DeWit:
It's funny.
Steven Butala:
You know what? We'll get all [inaudible 00:00:38].
Jill DeWit:
Here's the deal. People casually throw this. The South, they're like "No big deal. Rezone it to this. Here's what's possible. Piece of cake." Yeah, right.
Steven Butala:
Here's what I tried to go do one time. Then we'll get to the question. Take a 40 acre property that I paid $4,000 for in Arizona. It's a hundred dollars an acre. I paid a hundred dollars per acre. I tried to rezone it, or cut it up into 40 one acre properties, which I knew I could very easily and quickly sell for $500, plus fees. $500 times 40 is what? $200,000. I can take a $4,000 investment, cut it all up, and go through the paper process at the county. Is that right? Yeah, it is right.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
No.
Jill DeWit:
That's right. It's not 20,000.
Steven Butala:
It's five times, 20,000. I said 200.
Jill DeWit:
Oh.
Steven Butala:
It's $20,000. Not bad if you can do that 20 or 30 times a year, which we could do. We were easily buying that a month, and can do. It's a very, very appealing concept to take. There's a lot of different names for it. It's the bottle case method, convenience store buys, cases and cases of stuff wholesale. Then they put them in a refrigerator, separate them all out, then sell them by the bottle. It's the same thing. The numbers are very, very attractive. The question is, that's what the show is about, "When do I do that? When do I subdivide my property or cut it all up?" I want to do it too. I want to do it.
Jill DeWit:
All right, chill out. We'll talk about this. I got there.
Steven Butala:
Before we get into it, let's take a question posted by one of our members on the landinvestors.com online community. It's free.
Jill DeWit:
I really do have a lot of notes on this topic. That's why I brought this topic up, we should talk about this today, because I have a lot to say. All right. Luke wrote... Where am I writing?
Steven Butala:
It's on the letter, dear.
Jill DeWit:
Oh, excuse me. Leonard wrote, "Hello, everyone. I've been selling properties in Arkansas, bought from the commissioner. I've previously been waiting to have the physical deed before I list the property. However, I bought a couple of which I have received tax and HOA bills and no deed yet. Can I use the previous deed of the property before the commissioner foreclosed to sell the property when making the new buyer's deed, or must I wait longer? When should I list these properties? Thanks, Leonard." Then one of our members wrote in and added his personal spin here, "Some of those counties can take months and months and months, if ever. You can call the state and ask them, if you only do a couple at a time and are cool with it. They tell you when they deeded it over." Sometimes it's like, "Oh yeah, you got that." You bought it, it's like, "Oh yes, it's already in your name, it's coming," basically. I'm sure with virus times too, who knows how long it's been.
Steven Butala:
That's where it is.
Jill DeWit:
Yeah. It's past the redemption period. You're all clear. You can sell it, waiting on Mr so-and-so to sign this. Love the commissioner of the state land. I don't know, whatever that. Other times they'll say, "Yep, we sent it to the county for recording. Call the county.