Residential Land Uses

1
Residential Land Uses

• Jim Burton, Ph.D.
• Marketing Real Estate
• College of Business

2
Overview

• Development Process
• Types of Residential Development
• Market Feasibility Analysis
• Financial Feasibility
• Absorption Analysis

3
Development Process

• Development Idea
• Preliminary Market Analysis
• Preliminary Plans Specs
• Preliminary Costs
• Development Loan
• Final Market, Plans Costs
• Construction
• Marketing Sales

4
Types of Residential Development

• Single-Family Detached
• Single-Family Attached
• Multi-Family Apartments, Condos Coops
• Manufactured Homes
• Second Homes

5
Market Feasibility Analysis

• Define Market Area
• General Economic Trends
• Demand Analysis
• Competitive Analysis
• Demand Gaps
• Absorption Rates

6
Absorption Analysis

• Demand gt Supply
• Expected Household Growth
• Expected Employment Growth
• Existing Planned Competition
• Absorption is an Opinion

7
Financial Feasibility

• Forecast Monthly Sales
• Forecast Monthly Costs
• Forecast Monthly DS
• Forecast Monthly Taxes
• Forecast Monthly CF
• Calculate IRR
• Compare IRR with Risks