How to Subdivide Real Estate

How to Subdivide Real Estate

If you have a large chunk of land and you don’t want to use it all, or if you’re contemplating the purchase of an expansive acreage, you might consider subdividing. When you subdivide real estate, you sell off sections of the same property. This occurs quite often with residential real estate developers and commercial enterprises when property is sold off in chunks. The process seems quite difficult, but it isn’t if you follow these guidelines.

Acquire the Property

Unless you already own it, you’ll want to purchase the real estate you’ll eventually subdivide. In order for you to do this properly, you’ll need to own the land free and clear, so don’t purchase land against which liens have been filed. This is possibly the longest step because you’ll need to wait for escrow to close and the funding to come through, but be patient and make sure you found the right chunk of real estate before you put your money down.

Research Ordinances

The main obstacle you’ll face when you decide to subdivide real estate is city and county ordinances that prevent certain pieces of land from being sectioned. Find out all you can about zoning and utilities and where water and gas lines have already been laid. This will tell you how you can eventually subdivide the property when you get ready to sell.

Survey the Property

Although this process is expensive, it is necessary if you’re going to subdivide real estate. The surveyor will come out and take measurements and dimensions of all aspects of the land, including any changes in topography. His or her findings will then be compared against city or county records, which will finalize the blueprints for your property and will be used to divide the land once you’re ready to sell.

Determine Division

Next, you’ll need to decide how many plots you want once you subdivide your real estate, and how big each plot will be. The land surveyor you hired in the previous point will come in handy here, and can help make sure that you allow necessary space for things like utility easements. You’ll need to know where roads will be and how much space you want to separate each plot, which will depend on the type of real estate you’ve purchased.

Plat the Property

Once you’ve made the above determinations, you’ll need to plat the property for county tax records purposes. This should take a few weeks, and you need to make sure all interested parties get a copy. This informs the tax office that the real estate’s tax status will change from an acreage to individual plots once you’ve managed to sell off the land.

Sell the Property

Finally, you can get started selling off portions of your property. A title company can handle the legal paperwork, and your real estate agent can handle the marketing end. Depending on the type of land you’re selling and the quality of each plot, you could sell every piece in two weeks, or it could take years. Regardless, you’ve managed to successfully subdivide your real estate property.

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