Pro's and Con's: buying a large plot of land in a group and then dividing it to make an estate.

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sable99

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Hi.

What would be the pros and cons of the following:

Lets say about 100 investors buy the following plot :

www.property24.com

Farm for sale in Elands Bay - Elands Bay - Property24

This 1794 ha farm near Elands Bay has excellent views of the sea and the Verlorenvlei estuary. It consists of two title deeds with 490 ha arable land, 1283 ha shrubland (fynbos veld). A separate 21 ha portion lies next to Verlorenvlei and has been improved with 3 houses. The entire western...
www.property24.com www.property24.com

Then each investor contributes 100k towards the purchase and then shares the costs to convert into an estate.

Investors can then build homes following a certain agreed code on their allocated plot,

What would would be the pro's and con's of such an arrangement and would it be a lot more profitable than buying a single stand in an established estate?
 
Yeah, too many things to go wrong with 100 people. The paperwork covering that contract would need to be airtight. Not worth taking the risk.
 
The answer is simple, it's a terrible idea. People can't be trusted. Even if you went into this kind of deal with your family and friends, it would likely turn into a disaster.
 
Thanks forwarding this to me. I think I want to buy it now:unsure:
 
You'd first have to check that you're able to get municipal approval to convert that to residential, if I lived in that area I'd protest against it.
 
I'm no expert and may be wrong, but I am pretty sure that (apart from the obvious issues mentioned above) there is a plethora of paperwork, Environmental Impact, and Traffic studies, zoning, approvals, etc required before you will be able to build 100 homes. I imagine some of these take years and years.
 
I invested in a similar scheme several years ago, never heard back from them.
It got stuck somewhere on getting building approvals then never heard back from them..
 
Snyper564 said:
Number one reason I will not buy in an estate or complex

Investors can then build homes following a certain agreed code on their allocated plot

I DO WHAT I WANT TO DO :)
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Until someone builds an eyesore or a shanty and ruins the value for the rest of the estate.
 
joker08 said:
I invested in a similar scheme several years ago, never heard back from them.
It got stuck somewhere on getting building approvals then never heard back from them..
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saturnz said:
I don't trust anyone when it comes to money.

I definitely wouldn't trust 100 people when it comes to my investments.
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werfie said:
I'm no expert and may be wrong, but I am pretty sure that (apart from the obvious issues mentioned above) there is a plethora of paperwork, Environmental Impact, and Traffic studies, zoning, approvals, etc required before you will be able to build 100 homes. I imagine some of these take years and years.
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Bad idea, I get it. I guess its a job of property developer.
 
sable99 said:
But the ownership would be a share then and not sectional title?
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You can structure a legal agreement any way you want.

I know someone who owned a big plot of land and instead of selling the land to a developer they made an agreement that he would get a few units in return for the developer taking over the property.
I'm not sure how that sale works but then they sell the land for R1 or a very low amount.
 
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