Flipping Hillside Land by Installing Foundations?

In My Humble Opinion
1

There’s a set of 1/3rd acre parcels for sale, dirt-cheap, on a nearby, steep canyon wall (I’m going to guess somewhere between 50-60 degrees). The slope is a sharp drop-off from the road, from right behind the guide rail. The road itself is one of the paths in to a small, low traffic highway onramp/offramp; it has two lanes; and it has a retaining wall on the opposite side, with no pedestrian walkspace on either side. Very narrow, with no place to put anything.

I know next to nothing about construction costs but, certainly, it seems like a tough place to build something so I can see why the land is worth almost nothing.

I recognize that none of you could evaluate the cost of trying to build some sort of foundation (walled, stilts, cantilevered, or whatever) that some other person could build a 1000-2000 sq. ft. home on, without access to the property, local knowledge, etc. I would need to hire a local person. But I don’t even know if it would be something in the ranges in the hundreds of thousands of dollars, millions, billions, or what. There’s no point in talking to someone if it would be billions of dollars and ten years of working through permits.

But I am willing to work through permits and manage things, if it wouldn’t be too insanely long to arrange stuff with the local government. So it’s just a question of whether:

  1. It’s plausible (i.e. worth talking to an local engineer about) that there’s something that could be done (to at least one lot) for say less than a half mill?
  2. You can attract buyers, having put in a generic rectangular, barren foundation?

Any thoughts?

2

If the hill washes out and takes out the road above is the owner responsible for rebuilding it?

3

There are lots of areas in California, AZ, NV, etc., where houses are built on steep slopes. It can be done. The steeper the slope, the harder = more expensive it is.

A separate matter is how unstable the slope is. Which is often de-stabilized by the work you do installing the pilings and foundations and the extra weight put on what’s already a marginal situation. There are engineering companies that can advise on this for any specific site, but it won’t be cheap.

Finally, I don’t think it would be practical for you as a developer to build a stilted slab, then expect the buyer to come in and drop a house of their own design on your slab. The whole system needs to be designed as a unit. The weight, the floorplan footprint, the location of plumbing, etc., all interact.

As to your direct question, I think you could get an engineering firm to offer a quick “no chance or some chance” determination for a couple to few thousand depending on the size of area you’re asking about. Assuming the answer doesn’t come back “No chance”, now you spend the serious money to do real analysis to get to “yes” or “no”. Tens of thousands.

One of my relatives was one of the founders here:

“Geotechnical engineering” is the specialty you’re looking for. And yes, his hillside house in the SF Bay Area is as spectacular as you might imagine.

Story time:
I once looked at houses for sale in Reno NV. There was a beautiful set of about 8 McMansions / mansions in a row perched just below a ridgeline looking out over the wide valley full of city below. About 4000SF interior space. The mongo garage was off the road along the ridge crest and you entered the house from that level into the top floor of the house which was all wall-o-windows open plan living area & ~800sf kitchen. The bedrooms were on the next floor(s) down with equally spectacular views. You were a few hundred feet above the next lowest flattish terrain downhill. Truly a spectacular site. And sight.

These houses had every gizmo known to man, all top-end materials, decorator / designer out the wazoo. They’d been built for a couple mil apiece, and the original asking price was about 4 mil each. In Reno NV in about 1990. Pretty spiffy digs, and too rich for my blood at the time. The reason I even knew of them and went to see them is they were advertised for sale for about $400K each.

Why selling for 10 cents on the dollar? Because they and the whole ridge they were attached to was sliding down the steep hillside into the valley. It had just started, and was only a few inches slippage so far, but it wasn’t necessarily going to stop. And it was going to be colossally expensive to even try.

I passed.

4

Another anecdote: a local fire department once stopped development of a hillside by noting that their trucks could not climb the road to access the development. With no fire department access, there would be no insurers for the homes, and that was that.

5

50-60 degrees is damn near vertical. You couldn’t walk on the property at all. If it’s really that steep it’s pretty much unbuildable. Even if you were going to do pilings and piers, you need to be able to stage the machine somehow.

6

From what I’ve seen, many lots like that are zoned as “unbuildable” so you could never get the permits to build on it so good luck trying to sell it.

7

Yes - and most people overestimate the steepness of slopes - by a lot.

https://journals.sagepub.com/doi/abs/10.1177/0956797610393744

Before starting any early conversations with engineers / developers / fire departments, it might be worth trying to make a better estimate.

There’s an easy way to do it in this video. You can probably jump to two-thirds of the way through, when you see her making the measurements at the end it’s easy to see how she’s done it.

https://www.youtube.com/watch?v=yxpYmcP7RsQ

If you don’t have any prior expertise in slope estimation, my bet in the slope sweepstake is on 35 degees!

8

If the hill washes out and kills the people in the houses, is the owner responsible for negligent manslaughter?

Even if not, what would it be like to try to keep living in the same neighborhood as their surviving friends and family?

How about if erosion caused by the situation just seriously screws up the people further downhill: can the developer be sued for the damage?

– I don’t know about your area; but my town has restrictions on building on steep grades; including on building driveways etc.

Do people sometimes build in such situations anyway? Yup. But it’s almost always a terrible idea.

9

And 35 degrees is still damn steep. That’s pretty much a black diamond ski run, and climbing one of those is no joke. Average angle for residential stairs is 35 degrees. Imagine climbing that without steps.

10

Going back to the OP, both the post and the person …

I’ll try to tackle the meta-question that’s probably on your mind: “Is building in unobvious places (like steep slopes) an idea nobody else has had that will make me a lot of money in real estate?” If that is the thought, the answer is almost certainly “no”, or at least “probably not”.

In any area that has slopes, there will be engineers and builders who specialize in that stuff. That does not not mean every buildable slope already has a house on it. But it does mean that there’s not too many buildable slopes where the owner of that land doesn’t know a) how buildable it is, b) roughly what land of that buildability ought to sell for around here.

Including all the obstacles / issues mentioned by everyone above: permitability, road accessibility, utility accessibility, insurability, fire safety, soil stability, etc. Lots and lots of economic, practical, and regulatory hoops have to be jumped through to convert raw land into a house. The fact most generic houses are built on repurposed farmland or scrubland, and most houses on steep slopes are seriously expensive should suggest that there’s little economic low-hanging fruit here.

There’s an old joke about two economists who see a $20 lying on the sidewalk. One says to the other: “That’s impossible. If that was a real $20, someone would already have picked it up. We must be hallucinating.” The second picks it up and puts it in his pocket.

You can be the second economist. If you’re lucky. But the first one is usually right; the very short half-life of $20s on the sidewalk is why you encounter so few of them over a lifetime of walking.

11

It is. The angle of repose of various materials is shown here.

12

I guess that I’ll need to go back and measure but, checking a topographical map and using some trigonometry, I’m getting ~25 degrees.

I’d’a sworn that it looked a lot more perilous on the edge than that but, I suppose, I shouldn’t be too surprised to discover a human perception issue.

13

We require erosion and sediment control plans for any construction on slopes over 15%. Those plans need to be checked by the county Soil and Water Conservation Agency and if they don’t like them you’re not getting a permit.

Again, I don’t know what your area regulates, or how. But we’ve got good reason for those regulations.

14

Did you see your reflection in the snow-covered hills?

15

So the landslide won’t bring us down –

16

Our last house was built on the side of a hill and it was a nightmare having it releveled every hear. The paint on the walls would split and the plumbing went bad. We went after the owners for non-disclosure which was another PITA.

This house has no stilts. We are trainable.

17

Which still qualifies as ferociously steep.