Selling property subject to a subdivision ordinance

QUESTION: I have a listing on a house that is located on a 15-acre tract. A buyer has expressed interest in purchasing part of the tract that includes the house and around 5 acres. The price is right and my seller is willing. The buyer has informally agreed to pay for a survey of the part he wants to buy, but he doesn’t want to bear that expense until he has the property under contract. I know that it would be preferable to have a survey done before the property goes under contract so that the part being sold can be described by a metes and bounds description, but is it absolutely required? I am asking because I think there may be another way to describe the part being sold that would suffice for purposes of a contract.

ANSWER: A pre-contract survey would be preferable in order to describe the property in the contract by a metes and bounds description, but depending on the way the tract is configured and the presence of natural or man-made boundaries (streams, roads, etc.), it may in fact be possible (with assistance from a real property lawyer) to describe the property in a way that would be adequate for purposes of creating a valid contract. HOWEVER, if the county or city where your client’s property is located has adopted a subdivision ordinance, a survey quite likely will be required before the parties can enter into a contract and close on the property. Let us explain.

Cities and counties have the authority under NC law to adopt ordinances regulating the subdivision of land into parcels that are 10 acres or less. An owner who sells real property in violation of a subdivision ordinance is guilty of a Class 1 misdemeanor. See General Statutes Section 160D-807. Thus, it is extremely important that an owner understand and comply with the requirements of any applicable subdivision ordinance in selling his or her property. City and county subdivision ordinances vary a lot, but it is highly likely that any such ordinance will require, among other things, that a plat be prepared, approved, and recorded as a part of the process. This will require a survey.

The statute cited above does permit an owner to enter into a contract to sell subdivided property by reference to an approved preliminary plat for which a final plat of the subdivision has not yet been approved, provided that the contract meets several very specific requirements described in the statute.

The proposed sale you describe would constitute a subdivision that may be regulated by the city or county where the property is located since one or perhaps both resulting parcels will be 10 acres or less. A determination should first be made whether there is an applicable subdivision ordinance. If there is, the owner should be advised to consult with a real property lawyer to help guide him or her through the subdivision process.

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