This episode breaks down the unexpected complexities discovered during due diligence on what appeared to be a straightforward Texas 10-acre exception subdivide. The investigation revealed that even state-level exception criteria allowing subdivision without county approval can be overridden by verbal county policies, and that seemingly minor improvements like installing water meters can trigger review processes, forcing strategic adjustments to preserve the best deal ever funded by Serious Land Capital.
Key Takeaways:
- Texas 10-acre exception criteria doesn’t guarantee county non-involvement Despite state law allowing splits of 10+ acre parcels without approval, the county verbally reported that four or more child parcels require planning and zoning department review regardless of acreage, forcing a switch to a three-parcel layout.
- Infrastructure improvements void exception criteria protections Installing basic utilities like water meters technically triggers county review processes even under the 10-acre exception rule, though many operators ignore this requirement without consequences, making conservative approaches advisable on high-value deals.
- AI tools dramatically accelerate regulatory research Using Claude and other LLMs to analyze hundreds of pages of planning and zoning ordinances compressed weeks of manual review into manageable timeframes, enabling thorough due diligence without sacrificing deal velocity.
Listen to the full episode for insights on balancing legal rights versus practical relationship management with county officials and why the three-child-parcel layout proved more attractive to buyers anyway.
(Podcast transcript below)
Hi, Chris Duff over at Serious Land Capital, Vacant Land Funding Partners. So have a couple notes on everybody’s favorite topic, minor subdivides. It’s been a hot area of interest for the past few years within the land flipping industry. And people still continue to send us potential subdivides on a near daily.
basis. The key with these is just, know, landflipping is a risky enough business overall. And I always remark on this, we’ve run into plenty of issues over the past several years that we’ve been in the business and, you know, just look around at the turn rate within the industry, people come and go on a weekly basis into the landflipping game. So
You gotta, you gotta be heads up and aware before getting into these potentially risky projects, particularly if you’re operating in a new area and really needing to familiarize yourself with the regulations and timelines and costs associated with any of these subdivides. So I know I’ve mentioned a couple of the larger deals that we’re working on. There’s
one Texas 50 acre that out of the thousands of deals that we’ve reviewed, maybe the best deal that we’ve ever come across and funded. and. Yeah, it should be just a simple Texas, 10 acre plus, exception criteria where you don’t need to get any county approvals and so forth for the,
actual subdivision, you just submit your survey, create new legal descriptions, and you can just sell off those parcels without needing anything from a county approval side. Yeah, when we looked into this in a lot more detail, we were working with a local realtor who’s done projects like this routinely, our deal partner in the deal, also Texas-based.
and was researching, regulations actively as well. And, know, there were some interesting notes associated with that one. again, you can just make that assumption, Hey, you know, state law, so long as I have existing road frontage, I can do however many at minimum 10 acre lot splits as I would like. No one can tell me anything else. you always still want to check.
the county level regulations, potentially city level regulations anyway. Typically within law, state law will trump county law, but you don’t necessarily want to create a possible battle, even if you know you’re in legal right with something that doesn’t prevent any entity from potentially suing you and tying up funds and time.
to combat what might ultimately be a lawsuit that will resolve in your favor. But you always want to be more conservative than not. So we ended up looking into the county level regulations and while we couldn’t find anything in writing after a lot of diligence and we were using all the various AI LLM tools to review all the hundreds of pages of
planning and zoning ordinances and so forth, we did get a verbal report that from the planning and zoning office that any minor subdivision of at least four child parcels needed approval from the planning and zoning department, regardless of the child parcel acreage. So.
but they said, you know, below four child parcels doesn’t matter. Even though we had a 50 acre parcel and so theoretically, you know, it would have only made sense to do at most four child parcels over 10 acres just the way the property was laid out.
We contacted the surveyor and broker and so forth and they never ran into issues with the county in regard to just using the state exception criteria and not submitting to the county for any approvals. But because we did get a verbal report from that planning and zoning office, plus it ended up being that the three.
child personal layout was going to be more attractive than buyers anyway. It didn’t make sense to potentially open up a can of worms by ignoring what was reported to us verbally from the County Planning and Zoning Department and potentially risking a bit of a snafu or getting something legal or
fine thrown our way if we were trying to ignore what was reported to us. Also, when you use that Texas 10-acre plus exception criteria, by the strictest letter of the law, you are not allowed to do any type of infrastructure improvements, even if that is something so basic as just installing water meters.
for the anticipated child parcels and trying to make the property more turnkey to eventual end buyers. That in fact triggers a potential review process by the overseeing county where that property is. This was even news to the realtor who’s done a number of these transactions says, you know, people ignore that.
all the time and have never run into problems. But yes, by the letter of the law, that is something that can cause issues for possible minor subdivision within the state of Texas. So, you know, we ignored the recommendation initially to install water meters just in favor of being as conservative as possible. Again, utilizing
Uh, the AI LLMs, particularly Claude was extremely helpful for this and our, our deal partner, um, uh, was, you know, uh, excellent and kind of putting all of that together for our own research and, and teaching us more as well too. So, um, yeah, utilizing these tools on hand and really, familiarizing yourself, you know, asking the same question if you need to over and over again, possible multiple parties.
in order to really, really align on what the true necessities and regulations are to perform a subdivide is just absolutely critical for…
for making sure you don’t run afoul of potential issues when it comes to minor subdivisions in particular. And again, we operate nationally, so we’re even more careful not to get caught up in potential issues because it is so easy to be fooled in this business. We’ve been fooled many, many times before. Certainly happening again, but we don’t.
ever want to make a mistake more than once and always try to learn from other people’s mistakes. So that’s why I’m sharing all of this at the moment. cause the number one rule is to not lose money, in this business and just stay in it for the longterm. so that was an overview for that current Texas deal that we’re working on. We actually did just get the survey done earlier today. Drone photos should be happening here.
shortly as well and get that listed so I will be sure to report how that one goes once we get that set up for next week. Since this one’s running a little long, I’ll share more on our learning the Louisiana minor subdivide process in the next episode. Again, if you’re looking for any funding on your land deals, we’ve been getting so many lately, having to move more cash around, it’s been great.
to see this business grow. think we should definitely hit over eight figures top line revenue this year. That was the target. And you can’t focus on outputs too much, focus on inputs. All we do, keep marketing, keep staying focused, provide free content. That’s what we’re here to do. Keep getting better every single day. SeriousLand.capital for any funding requests that you have.
Check out the Land Daily Diligence Group for zero cost review of your land deals and landpricer.ai for the most simple and accurate way to price land deals. And it’s got a lot more work done there. So close to getting it set for testing. Talk to my engineering team. They are all set to go. Should be ready for testing by next week. See you next time. Bye.
