No More Land is Produced – Entrepreneur of the Week – Yossi Beit Yosef – Post 3

# Initiated week Yossi Beit Yosef # Post 3
“It’s the little one – it’s going to be big” – Invert Guta – Invert – “It’s the big one – it will be small”

In a previous post we already said “no more land is produced”
But the closest thing to that – is to produce smaller plots – Subdivisions
Creating small plots produces a profit similar to a “kimono” that buys a large inventory of what the “wholesaler” separates into small parts and sells them at a profit.

There are two main types of subdivisions big and small or in the professional language Major Subdivision or Manor Subdivision also called Landdivisin the names may differ from country to country and there are some that divide by area size or number of plots – for simplicity let’s stay with Major and Manor.

The difference is in the level of complexity and the level of risk, the division of Major requires the planning of roads, sidewalks, etc. and its approval is subject to a large number of committees, therefore it lasts longer and the financial investment is higher.
Since the laws differ from country to country – if you want to engage in this field – try to find the countries that facilitate
Example: Distributing 20 arcs in California costs more money and the approval process takes much longer than in Texas, while in California a public hearing is needed – in Texas it is not required for 20 acres.

How do you approach and how do you start? (The topic is complex for one post) But I will try to simplify it to 8 steps:

1. Find the market that suits you to work in (state and province that make it easier and not burdensome)
2. Define your criteria – and find the appropriate area for the division
3. First programming test (what is the minimum plot area on which a house can be built and in what area, density test allowed – how many houses is allowed to enter a hacker ?, Front width test – the minimum width required in front of the road, which are the most important initial tests, any deviation will affect character The division and profit / loss is possible and of course the question is – will there be demand?)
4. Economic programming test
5. Initial meeting with the planning department (the goal – testing and approval of the programming you tested – it is advisable to attach your professional team
6. Establishing a treatment team (your team must include: a certified surveyor and / or civilian surveyor, preferably a realtor who knows the area well and an expert in the lands, a professional project manager – will save you time for self-study especially at the beginning, a professional lawyer who may assist you mainly in public hearings )
7. Preparation of plans (technical division into plots)
8. Advance meeting to submit approvals (bring a full plan and make sure with the committee that nothing is missing, make sure the process and schedules- we do not want to miss anything, we would like to get details of expenses and fees required to continue – even if such payments can no longer on us.)

After this meeting the application has to be prepared and if we have done it according to the book – there is a status to program approval and the plan goes out for a public hearing (usually the hearing goes through positively) and then the approval is received and recorded in the district books.

The process can take about a year or less – depending on the state and county, if you have not prepared the plan as required, it may take longer or even be delayed.
Tip: As part of the preliminary examination, you will investigate whether similar applications have been submitted in the past and check – why were they rejected?

At this stage it is possible to sell the project to a development company that will do the actual work of construction including permits and construction plans or continue the process independently, I think at this stage the continuation of the process was written in a post by Il Price members as entrepreneur this week so I will not go into detail here.

Another option is to sell parts of the project to various contractors.
The more we take on the project in money and time, the more profit we will make
Personally I prefer to shorten times, make less money, but make quiet and avoid headaches.
And pass the deal on

I am attaching a picture of an area that is currently in the initial planning stages – which is also a stage that can be taken out of and transferred to another developer in exchange for a not bad commission similar to Holsale.

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How Do I Check the Soil in Florida and in General? – Yossi Beit Yosef – Post 5

# Entrepreneur of the Week Yossi Beit Yosef # Post 5
How do I check the soil in Florida and in general?
In post 2 – I mentioned that developers or investors do not ask what can be done with the land?
This is a very important question because only if we know what can be done with the soil can we know what to test and start the testing process.
An equally important second question, is what is our goal in the deal? – What is our starting point and what do we want to do with the land in general?
The answers to these questions will give us an answer to the question: what tests, I want to do and how much money I want to spend on tests!
The most important thing is to know the area and know the rules of the place – how do you do it?
Open up county websites, talk to local land brokers, and travel at least once to get to know the area.
If we take the example: Florida is a state that protects the flora and fauna and has many restrictions on this issue in different areas – ignorance can make you buy land at too expensive a price.
In Texas, on the other hand, it is advisable to pay attention to the issue of “mineral rights” – you would not want to purchase land in which the oil rights will remain in the hands of the seller! Especially if one day you find yourself sitting on a huge oil slick 🙂
Zvika came to me to help him sell land he had bought a few years earlier. “I have an excellent plot, my corner was proud of Zvika in my ears,” The test we did revealed that there are two turtle nests on the field.
In Florida as soon as there is turtle nesting – the lot is automatically declared a nature reserve and construction on it is prohibited,
The training of the plot for rebuilding increases the price of moving the turtles to another place – the price is about $ 6,000 per nest
So a potential buyer of Zvika’s plot will have to invest another $ 12,000
The price of the plots at that time was $ 8,000, so it made no sense to buy Zvika’s plot.
Zvika also bought the plot at an exorbitant price of about $ 35,000 and had a hard time dealing with the bitter cut.
And he decided to find his own solution – at this point I said goodbye to him – leaving you to imagine Zvika’s solution!
If Zvika had done the necessary tests, he would not have reached this state – get to know the area!
My friend Yossi Golan wrote in his post as an entrepreneur this week an orderly list of what should be checked for construction needs, read his post there is a detailed list and I will not repeat it here.
As a flipper of lands, I will perform only an initial inspection and the rest of the inspections I will leave to a customer who wants to purchase the land, as an entrepreneur who wants to build tomorrow morning I will conduct other inspections.
One of the important tests to be performed for construction purposes are survey tests and measurements called survay
The Land Survey defines the boundaries and features of a plot of land, including roads, service lines, buildings and natural elements such as ponds and streams. Other facilitations cross the property.
Because the survey needs of a commercial real estate investor are different from those of a homeowner who adds a garage – and both are different from the needs of the lender – there are many different types of surveys.
These are the most common, although the commonly known names may differ slightly depending on the location of the land:
1. Mortgage or ALTA / ACSM survey
This is the comprehensive survey that most lenders need underwriting requirements. This ensures that the property is as described in the legal documents and covers all the features and characteristics of the property.
2. Boundary Survey – This is the survey that the homeowner will be able to identify and verify the legal boundaries of a property.
3. Location Survey – This is a comprehensive border survey with information on improvements, usually used for the purposes of area loans and permits.
4. Web Design Survey – This survey combines a topographic survey of roads, canals, services and batteries with a boundary survey. Web design surveys are used to plan home and subdivision plots, commercial and industrial developments, transportation infrastructure and leisure facilities.

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Entrepreneur of the Week Yossi Golan – Day 3 – Land in Israel – Risk Management

Entrepreneur of the Week Yossi Golan # Post 3
Land in Israel – risk management
In a previous post we analyzed the issue of new land construction in the US and detailed a list of issues required for examination in the decision making process on land acquisition.
But what is happening in the Holy Land?
The answer in a nutshell – even more complex and challenging than in the US.
This post is unique to the world of agricultural land.
Let’s start.
Thawed and approved land for construction, unlike agricultural land, has very low risks, but also has low entrepreneurial profit.
Therefore, we will deal with agricultural land, the huge entrepreneurial profit inherent in it and the risks.
Many investors want to purchase agricultural land in Israel.
The purpose of the investment – to create a passive future profit resulting from the increase in the value of the land as a result of a change in its designation.
Some investors want to do so in Israel with the intention of spreading risks between real estate investments abroad and in Israel, and most of them out of a desire to purchase a property that is linked to rising real estate prices in Israel.
It has been said from the beginning – the critical step, which has the greatest impact on the value of the land – here is the completion of the thaw phase for construction.
Let us explain for a moment the concept:
The process of thawing / change of designation – means changing the designation of the land from land that is not approved for construction, let’s say an agricultural to land designated for private / saturated / commercial construction, etc.
When we come to consider the purchase of land that is not intended for construction, we must consider a large number of considerations, the most important of which is the length of time until the end of the process of changing the designation.
That is, the period of time that will elapse until we see an increase in value in our investment.
It is clear that the longer the process, the less attractive the investment.
Let’s take an example to illustrate with realistic numbers:
Agricultural land is currently sold in an excellent location in Hodesh for about NIS 300,000. The value of this land as thawed is NIS 1,000,000. Suppose that after a praise tax and expenses, a profit of NIS 500,000 remains.
And here comes the dimension of time – if the thawing process lasts 5 years, an annual profit of 100,000 NIS will be created, which is an annual return of about 33%.
However, if the thawing process takes 25 years, an annual profit of NIS 20,000 will be generated, which is an annual return of about 6.6% (and in practice even much less if we consider inflation and interest-bearing issues).
While Case A is a good deal, it is clear that in Case B it is not economic-entrepreneurial, with the only difference between the cases being the duration of the improvement / change of use process.
It should also be noted that most investors do not sell the land upon thawing and cut an oil coupon, but continue to build entrepreneurship as part of purchasing groups to increase profits several times over.
So how do you get started claiming a daycare tax deduction?
The answer – this world is very complex and depends on many variables, from the local committee, through the position of the district committee, to the entrepreneur’s abilities in promoting the program and ending with the state of the economy.
In this post we will try to get to know the most influential elements of the process when we come to make a wise-economic decision.
The explanation will come in the following example.
A few years ago, a friend came to me and asked for my opinion on a land deal that should provide him with the right to a housing unit in one of the cities in Israel. He approached me because he knew that my specialty was lands with a change of use.
With the intention of showing me how successful the negotiations were, he told me that out of 200 units in the project, about 190 units were sold.
Moreover, he showed me that while the average price at which a unit was sold is NIS 300,000, he skillfully lowered the price to only NIS 270,000 in negotiations with the developer. 10% below the market price.
My first reaction was that it would not be responsible on my part to advise him on the matter, as I do not know the city where the land is located, nor the city building plans, nor the city craftsmen, nor local nuances, nor the forces working to advance and reject the plan nor material details. Many more.
However, it’s a friend.

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