Many investors shy away from involvement in developing vacant land because of the sheer number of issues that it brings with it.

However, choosing the right piece of land to develop can be a lucrative investment.

What should a savvy investor look out for when considering developing vacant land?

Your due diligence should include the following check points which will indicate a great deal – or a deal breaker.

Zoning

While land can often be rezoned to allow for small businesses, or a growing local area, there are many hoops to jump through. So, your first call should be to the planning office to confirm the zoning of the property in question, and to gather a list of acceptable uses.

For example, commercial or business zoning has four main divisions which can allow for a shopping centre with a variety of shops (such a liquor stores), or the other end of the scale which will only allow an office park.

Topography

Ideally you should visit the vacant property that you are considering, to get an idea of the lay of the land. 4000m² means very little if half of it is on a cliff edge, or in a river. The topography of the property will dictate, to a large extent, the possible uses.

Your property agent should be able to provide an SG diagram which will give you much of this information, but Google Earth is another great source of information while you’re doing your research.

Public Services

While many areas in South Africa are on a water-borne sewage system, just as many are not. How easy would it be to get running water and electricity to your land if it is not available already?

While the municipalities will supply to a point, you may find that you have a large bill in the form of running underground electrical cables from a main road to your own distribution board. These should be factored in when considering developing vacant land, especially in the more rural areas.

There are many factors to consider as a property investor. Our next article will dig a little deeper into these matters to ensure you make the right decisions when looking for developable land.

In the meantime, feel free to contact one of our experienced team to assist you with uncovering the value of your property investments. Visit us at www.property-valuation.co.za.