7/17/17 Land Under $1M Update

Its a month later and 4 of the 13 Parcels of land under $1M are under agreement or sold, plus one new listing is U/A.  115 Surfside Rd sold on 6/7 for $900,000 which I hadnt noticed.  A new listing on 2 acres at 5 Felcon Dr for $795K went under agreement immediately on July 4th after being on the market less than one day.  Its kind of like putting a market order in to sell stock at lower than the going price, it will sell immediately.  Also 20A York, 24 Field Ave, and 10 Alexandia have gone under agreement.

New on the under $1M list are lots off of Bartlett Rd on a new road called Grey Lady Ln (cool name!). This whole thing was recently for sale for $4.2M as a subdividable 54 Bartlett Rd (although its on the town map as 52R Bartlett Rd).  As crazy as $4.2M for anything on Bartlett Rd sounds (predominantly a year round neighborhood), it is nearly 2 acres and is subdividable into 13 lots.  $4.2M divided by 13 equals $323,077 each.  All of a sudden it makes sense!

There were no takers, however, so the owners, with some help from a local broker (now a partner by the looks of it), have changed the game by dividing it themselves and selling the lots off individually.  They took one lot off by including a community pool and pool cabana, nearly an identical plan as Finback Ln across the street (although Finback has much more green space which every lot borders).  The first 6 lots are for sale for $675K each (3),  one for $725K and 2 for $650K each, or $4.05M total...so far...thats only 6 of the 12 lots.  It doesnt stop there because there are 4 more lots labeled "Golf Course Lots" because they border the Miacomet Golf Course.  These lots havent been listed yet but one would surmise they would be listed higher than the $725K lot because of the view across the golf course.  How much more? I dunno, guessing $795K? There are also 2 more lots (lots 1 and 2) on the left as you pull in, which would be lower priced lots ($650K?).  The last lot sale on Finback was $525K about a year ago and home sales ranging from $1.6M in 2014 to $2M recently.  So one could estimate similar prices here. So we have an approximate total of $8,530,000 minus the cost of the road, sewer, water piping, sidewalks, curbing, pool, and pool cabana.  All this, with permits, engineering, etc, etc could cost around $600-$700K, so a net profit of "only" about $3,630,000.  Even if I'm short on the expenses, they are still doing very well here.  That $4.2M isnt looking so bad now, is it?

Update 7/28/17  The rest of the lots are now listed with the "Golf Course" lots 875K and 895K, which brings the grand total of all asking prices on Grey Lady Ln to $8,845,000.

The $675K lots would be a 28.5% jump from the last lot sale 15 months ago on Finback and 32.5% of a $2M final value.  This is right about where the spec builder I talked about on the old site that built 1 Long Pond Rd paid for his next lot at 48A West Chester St ($885K is 32.8% of the beginning $2.695M asking price, while at 1 Long Pond his land cost in Sept 2014 was 27.5% of his beginning asking price and 30.1% of the final sale price...land costs are creeping up!). While these might sell for a little less (All else being equal I would prefer Finback over Grey Lady since there is much more green space), they will still make a bundle on this...eventually. The guy who owns this (since 1974 if the town record is correct) will be a perfect candidate for a 1031 exchange (or 12 of them).

3 Mary Ann Ln, out by the Airport, has been reduced from $475K to $444K.

A lot off Old South Rd at 31 Pine Crest Ln (not far from the 3 Mary Ann above) has come on the market for $459K.

A lot at 3 Tetawkimmo has come on the market for $950K which is an expensive 47.5% of the usual $2Mish sale in this neighborhood, although there is some promise of higher sales in the future.  It is the first lot on the right so you have every other lot owner driving by (23 of them with 5 more possible, which is why I always prefer to be at the end of the road rather than the beginning) and it is across from the old sandpit which has created complaints of noise and dust in the past.  You also get a fair amount of airplane noise here as this is sort of in line with Runway 6/24 which is only .9 miles away.  Its not directly in line but many flights "curve in" to the runway.  You should go hang out for a while on this lot on different days with different wind directions if you are interested in this lot.  The last lot sale in here was in 2014 for $605K and it took forever to sell (a little bit different of a market now though!). Still, I'd give a value of about $650K here, $950K just seems too high to me (which probably means someone is typing up a $900K offer as I type this).

There is also a $775K lot at 31 Madaket Rd which is part of a small farm that is being split up and sold.  You can still buy the whole thing though if you want.

Gone in 60 Seconds

A large 2 acre lot came on the market at 5 Felcon Dr, which is off South Shore Rd (Sewer Bed Rd) in what looks like a used-to-be large family plot that has been subdivided.  Its about 1/2 mile from the waste water treatment plant, so not as much of a "sniff factor" as the 24 Field Ave lot I talked about. The price? $795,000 (134.7% of assessed, a little below last years average sale of 136%, so a low starting point).  Ding! Gone in 60... well, one day, or some fraction thereof.  If a good deal comes up, you need to move on it immediately, especially with vacant land.

I also noticed a new listing at 6 & 4 Seven Mile Ln in Sconset for $2.85M for both.  There is a house on #6 as well as the vacant lot at #4 that I talked about earlier and liked.  This is not a bad deal!  The house is OK-Nice, could use a little updating or nicer finishings but certainly a great start.  This all borders hundreds of acres of conservation land out the back door. A 95% offer is $2.7M  Not a bad deal, I dont expect this to last long.

Another development in the Land for under $1M is the listing of 3 Friendship Ln.  This sold a while back (9/8/14) for $390,000.  The buyer added HDC approved plans and sold it for $480,000 on 9/8/16 (yes exactly 2 years later).  The present owner is trying to get $710,000, or a 47.9% profit in 10 months.  At this price it is a very expensive 59% of the approx $1.2M upper end value for this neighborhood.   It will be interesting to see what it goes for this time.

Another interesting listing demonstrating how people are making $$$ (or at least trying to) is 1 Jefferson Ln in Town for $1,500,000.  This is the rear 1 BR 1 BA 776 sq ft cottage to 55 Fair St and because it is 50 years old it can be subdivided off the original house.  Also because it is not an antique, you can take the cottage to the dump on Sunday.  The sale comes with plans for your new residence AND accessory cottage, all on a 3626 sq ft "spin-off" lot. Your lawn mower guy sure isnt going to take long!  The original house, which originally included this cottage, sold on April 28, 2017, or 3 months ago, for $2.25M. In other words if they get their $1.5M, the original house will have only cost them $750K, which they can then sell for around $1.5-1.6M, so a total gross profit of about $750K, or 33.3% in less than a year (only 3 months if they sold it tomorrow).  A $1.5M sale here would represent 156% of the assessment of the land.  This is yet another example of buy the original dividable property and spin off the "dividend", lowering your cost of the main.