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Land Pressure: Combating “Zombie Subdivisions”

The Atlantic: The Unfinished Suburbs of America

Images: Alana Semuels, The Atlantic

In the boom years of the early 2000s, builders and developers bought up land as fast as they could pave and name the streets. Development of America’s suburbs pushed full-steam ahead towards creating affordable housing options for a market that demanded bigger houses and backyards for families.

Then came the recession. Development stalled on thousands of acres across the country. In some counties in the West, 15 to 33 percent of all subdivision lots are vacant, according to the Sonoran Institute. In Teton County, Idaho, 68 percent of land bought for subdivisions was left undeveloped. In Tustin, CA, the Tustin Legacy development left over 1,500 acres of prime California real estate a difficult mix of tightly-packed homes and sparkling retail mixed with open fields and abandoned military buildings.

As this valuable land sits idle, Americans’ preferences for how and where they live are changing. Walkability is quickly becoming an expectation – less driving and more walking to work, school, the grocery store and the ball park. These changes impact where and how builders create communities – and impact the value of the land they bought back in 2004. One report from the Lincoln Institute of Land Policy has gone so far as to call them “zombie subdivisions” in a report on how to “combat” them.

Land pressure

The housing industry’s boom and bust of the 2000s has put pressure on land from various directions – these zombie subdivisions are just one. (Drought and flood plain rules are also on the horizon.)

We’ve provided some resources in the links above and below, but we don’t have a crystal ball to tell you how or where to build. What we do have are the tools to help you see your land in a new light. Though we specialize in developing software for homebuilders, our homebuilding partners have pushed us to develop software for their land departments.

Homebuilding software vs. land development software

In the world of residential construction/homebuilding software, project management involves a flurry of schedules, invoices and purchase orders between the builder and various personnel, vendors and trades.

In the world of land planning and development, far fewer invoices and purchase orders are generated over the life of the project. The value of these invoices however can be massive – and breaking those costs down to specific divisions, communities, and individual lots becomes a monumental task.

Take into account the stale land environment of the past decade, and depreciation of those tracts adds further pressure on the accounting department to effectively translate historical costs to active projects.

The cost of sale of the lot

LandDev is a software solution built specifically for managing land development projects, including the complex numbers behind the scenes. Begin with acquisition costs, financing costs, construction costs, closing costs and carrying costs, and distribute them down to the cost of sale of the lot. LandDev makes this process simple, breaking costs down to individual phases or even sub-phases of projects within the lot itself.

With increased demands on the land department to find and develop new plots for an increasingly active homebuilding department, effective budgeting and accounting starts with effective operational job costing. In addition to allocating costs down to the lot, LandDev is a fully featured land management solution.

From acquisition and bid comparison to project management and contract generation, LandDev has the features you need to manage the land development process.

To learn more, request a demonstration of LandDev.

Land Planning Resources

America in 2015: Bridging the Access Gap for Healthier Amenities
The Unfinished Suburbs of America
Data-Driven: Leveraging the Potential of Big Data for Planning
Arrested Developments: Combating Zombie Subdivisions and Other Excess Entitlements
After housing slump, 1,100 homes to open at Tustin Legacy
Water Woes: What the California Drought Means for Home Building
New Floodplain Rules Would Limit Construction

 

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