If you want to take legal ownership of a residential property, you have to be well aware of the fact that the entire process can take a long time, usually over five years, and can be very costly. For five lots or less, the cost that you will have to pay for parcel maps can amount as high as 100,000 dollars. On the other hand, you can pay more than 500,000 dollars if you need tract maps for over five lots.
The potential size and the number of lots that you can create with your residential construction project will depend on your general and zoning plan, slope, health department regulations, and biology. You also need to think about paying for the costs involved in reports and studies, regulatory fees, processing, and engineering.
The reports and studies aspect include traffic, noise, biology, soils, archeology and anthropology, storm water treatment, and approval costs. After a map is recorded and approved, there will again be additional fees that you must pay including the following but can include more:
• Retention and drainage basins
• Potential greenhouse gas studies
• School fees
• On- and off-site mitigation land
• Physical secondary access
• Parks and recreation fees
• Annual bonding fees
• Fire fees.
Politics play a crucial role in getting the approval from your local planning commissions, city councils, and county boards. Your being able to support or oppose the public office will have some effect on the time when your hearing will be completed. They can be completed as early as four months or can take longer as a year or a couple of years but still cost more than one million dollars. For property owners, there are three essential factors that they need to keep in mind and they must do for their new residential construction projects.
1. Entitlement and sale of the property as it is. This option costs the least; however, it has the lowest price and only requires a short time for the property to be disposed. In the most uncommon of cases, the land can have a bigger value when it does not come with its own title.
2. Be part of a long-term agreement. If a home builder takes charge in paying for the costs involved in processing a tract map, an agreement will then be made with them. This option is the most common among new residential construction projects. This can take up to a maximum of 5 years to be done. After contingencies are approved, on a periodical basis, the buyer must make sure to release deposits that are nonrefundable to the seller. Once a final or tentative map is approved, that is the time that escrow closing happens.
3. The owner takes charge of the entitlement costs. This last option is more or less the same as the second option. However, what sets the third option apart from the second option will be the fact that the owner will pay for all the expenses and will have full control of the mapping process.
The outcome of each of these three options must be well thought of by you before you finalize what option you must push through. There have been some owners who did not seek some professional advice and decided to process the map on their own and have later on found out that they do not have the financial means to take care of their lots. Thus, for any new construction project endeavors that you have in mind, be sure to get the help of a competent engineer, a smart growth design principal, and a reliable contractor.