Hello everyone,
I have a piece of land I’m interested in which requires a building
permit. What is the process for obtaining a building permit? What are
some of costs I will encounter? (actual guestimate figures will help)
Also, if there is any other helpful information you guys could provide
such as what to do and what not to do, I’d appreciate it.
ryan - if you want to build on any land - you need a building permit. the requirements will vary by municipality - you’ll have to get friendly with the township the property is located in.
well i know some of the basics.
you’ll need a current survey of the lot. if you have dimensions of the structure already - then he should be able to put the “box” on the lot survey (the surveyor should know the max size that can be placed on lot).
if you don’t have any plans - he could still just put a box on the lot and submit it to
a board of health (if required to get a permit from here first - again, it depends on the specific requirements of the township).
you’ll need current architect plans - certified by an architect in your state -
if you’re buying land that has a current survey on it, then just makes sure it’s CURRENT. (again, check with township to see exactly what they consider “current”…
those are the first two building blocks of obtaining a permit. before going through all that trouble also - you might just ask around, call the town and see what type of frontage and size of a lot that is required in order to build.
see if you can get a hold of a plat. you may be able to access parcel info online as well.
UTILITIES are huge - make sure the lot as utility/sewer connection. if it doesn’t - the expense could be HUGE. most towns will offer information on expenses of connecting to city sewer (if applicable).
you’ll also need a builder - a construction loan where the builder will draw on it during the process (this is where using a reputable builder comes in) -
you’ll close the construction loan with a refinance (to a permanent mortgage) at building completion.
if you have SOLID and good appraisals - buying the lot below market value and have a good builder who can nail his estimated expenses - at closing, many times, when you refi on the appraised value of the property - it should appraise for much more than what it cost to build - thus you can have an LTV of say 75% - and put some tax-free cash in your pocket…this will depend on your exit strategy.