| Line | Amount |
|---|---|
| Gross revenue — lot sales (35 lots × $85,000/lot) CONDITIONAL on buildable area | $2,975,000 |
| Land acquisition (3 parcels sold together) | ($275,000) |
| Land closing (~2% of land) | ($5,500) |
| Subdivision infra — work scope (35 lots × $35,000 cost/lot = $1,225,000 cost) | ($1,225,000) |
| Home On builder margin on infra (20% intro rate; standard 30%) | ($306,250) |
| Entitlement soft costs — survey, zoning verification, civil, permits (at cost) | ($61,250) |
| Contingency (10% of infra scope, AT COST — typically returned if unused) | ($122,500) |
| Construction loan closing (1.5%) + carry (10% APR on draws, 18 mo) | ($134,326) |
| Selling costs (~7% of lot-sale revenue) — paid at closing, not out-of-pocket | ($208,250) |
| NET PROFIT TO INVESTOR (CONDITIONAL) | ~$636,924 · 21.4% margin · 99.9% cash-on-cash — IF 35 buildable lots confirmed |
No house ARV modeled — lot-sale strategy. Wake Forest residential lots (public sewer, RS-20 zoning) sell $75k–$110k depending on neighborhood and lot size. Used $85k/lot as base. MAO: ~$310k (35 lots × $85k with 20% margin) vs $275k ask = $35k (11.3%) cushion — attractive IF lots achievable. At only 20 lots (more likely given floodplain): MAO ≈ $178k and deal is upside-down at $275k ask. The 556-day market time is the key red flag.
This is a story-stock land play: the price is extraordinary ($7,428/acre for Wake Forest with public sewer access) and the seller is clearly motivated after 556 days. The deal becomes exceptional IF a site walk and GIS review confirm 30+ acres of buildable upland — at 35 entitled lots sold at $85k/lot, the investor nets +$636,924 (21.4% margin, nearly 100% cash-on-cash) on $637,326 cash out-of-pocket. But the 556 DOM tells you developers have driven by and moved on — almost certainly because the floodplain and pond dominate the usable area. Grade it MARGINAL until a site walk and GIS analysis say otherwise. If you are within 20 minutes of Wake Forest this week: walk the property, pull the county GIS, and call the listing agent to ask specifically how much is outside the 100-year floodplain. That one call and 30-minute site visit could either confirm a GREAT deal or save you from chasing a mirage.