A
Ahmed12
New Member
What would be more financially beneficial: selling a development site as land or selling post development?
Nicholas Wallwork
Editor-in-Chief
Staff member
Premium Member
Hi @Ahmed12
Normally if you get the build right it's more financially beneficial to sell after the development phase.
If you sell just the site the incoming buyer will want to make some profit as well from carrying out the development themselves (and taking that risk) so you'll have to bear that in mind.
That being said it's often nice to turn land sites around quickly without the hassle of developing them out as you can free up cashflow and go on and make your money on another land site...
It also depends on your experience... if you have construction experience or not and what you enjoy doing all form part of your decision as to which type of property deals you like to get involved with...
Normally if you get the build right it's more financially beneficial to sell after the development phase.
If you sell just the site the incoming buyer will want to make some profit as well from carrying out the development themselves (and taking that risk) so you'll have to bear that in mind.
That being said it's often nice to turn land sites around quickly without the hassle of developing them out as you can free up cashflow and go on and make your money on another land site...
It also depends on your experience... if you have construction experience or not and what you enjoy doing all form part of your decision as to which type of property deals you like to get involved with...
L
Longterminvestor
Administrator
The easiest option would be to sell the land pre-development but as Nick mentioned there is potentially greater profit selling post-development. It all comes down to your risk profile/finances and ultimately your experience in property development.
Joe Aston
New Member
Forum Partner
I can't comment on what is best, but an interesting situation as we are seeing a rise in enquiries for land to gain planning permission before selling on as opposed to full developments. Maybe it's the lower risk factor?
Either way there is still a real appetite from lenders to get involved in these sorts of deals.
Either way there is still a real appetite from lenders to get involved in these sorts of deals.
