Free Subdivision Profit Calculator
Calculate the projected profit from subdividing and developing land into individual lots for sale, accounting for all development costs and the expected sale price per lot.
Net Profit
$305,500
Net Profit vs Expected Absorption (months)
Subdivision Profit Analysis
Subdivision development involves purchasing raw land, improving it with infrastructure, and selling individual lots to builders or homebuyers.
Formula
Net Profit = Gross Revenue - Development Cost - Selling Costs - Carry Costs
Absorption Rate
The absorption rate (lots sold per month) is critical because it determines how long your capital is tied up and how much you spend on carrying costs. A faster absorption means:
Target Returns
Phasing Strategy
Larger subdivisions are often developed in phases to reduce risk and capital requirements. Revenue from early phases helps fund later phases.
Example Calculation
$1,500,000 total development cost, 25 lots at $85,000 each, 6% selling costs, 24-month absorption, $8,000/month carry costs.
- 01Gross revenue: 25 x $85,000 = $2,125,000
- 02Selling costs: $2,125,000 x 6% = $127,500
- 03Carry costs: 24 x $8,000 = $192,000
- 04Total costs: $1,500,000 + $127,500 + $192,000 = $1,819,500
- 05Net profit: $2,125,000 - $1,819,500 = $305,500
- 06Profit margin: $305,500 / $2,125,000 = 14.4%
- 07ROI: $305,500 / $1,500,000 = 20.4%
- 08Absorption rate: 25 / 24 = 1.04 lots/month