In this video, we’re going to explore whether buying a large plot of land to split it into several parcels is truly a profitable operation. Thanks to Market Explorer, you will learn how to cost out a land subdivision project.
🔍 1. Why subdivide a plot of land?
The basic idea is simple:
- The larger a plot is, the lower the price per m².
- By dividing a plot into several smaller parcels, you can resell them for a higher price per m².
Example:
You buy a plot of 4000m² at €50/m², for a total of €200,000.
Then, you divide it into 4 lots of 1000m² that you sell at €125/m², i.e. €500,000 in total.
📊 2. How to analyze the deal with Market Explorer?
Step 1: Market study
In a previous video, we showed how to export land data in Namur from Market Explorer and build a chart that illustrates the relationship between price per m² and area.
Result: The larger the area, the lower the price per m².
Step 2: Costing the operation
In a dedicated Excel sheet, you will find:
- ✅ The purchase price of the land
- 💸 The purchase costs (notary, duties, etc.)
- 📉 Any financing costs
- 🛠️ The servicing and development costs
- 📈 A resale projection
📐 3. Result of the example
Let’s now take a quantified example to illustrate concretely the profitability of a land subdivision.
You buy a plot of 4000 m² at a price of €50/m², i.e. a gross purchase price of €200,000. Added to this are various costs: acquisition costs (notary, registration duties), financing costs, servicing (connections, access, etc.), for an overall total of €380,000.
You then divide this plot into 4 lots of 1000 m², which you resell at an average price of €125/m². The total resale therefore amounts to €500,000.
| Item | Amount |
|---|---|
| Total price (purchase + costs) | 380 000 € |
| Resale price (4 lots × €125/m²) | 500 000 € |
| Estimated margin | 120 000 € |
This calculation shows that a land subdivision operation can generate a comfortable margin, provided of course that you know the local market well, the feasible resale prices, and the potential hidden costs.
🧠 Conclusion
This tutorial showed you how to:
- Use Market Explorer to analyze the land market.
- Check the profitability of a land subdivision.
- Do a quick costing to make informed decisions.
👉 Feel free to replicate this method with data from your own region to assess the potential of your land projects!