How INSITE sizes per-parcel financing.
Two constraints drive every underwriting decision: the finished lot value of the home being built, and the total annual property tax burden the parcel can carry. Together they cap how much fee financing a parcel can support.
Finished lot value
The finished lot is typically worth 20%–30% of the finished home value. A $1,000,000 home implies a finished lot value between $200,000 and $300,000. That lot value is the collateral floor the financing is sized against.
Once the finished lot value is determined, the available financing is sized at one-quarter (25%) of that lot value.
The 2% effective tax ceiling
The combined annual property tax burden — general 1.125% ad valorem, any existing assessments, and the new INSITE assessment — should not exceed 2% of home value per year. INSITE underwrites the new assessment to a rule of thumb of 0.50%, leaving headroom under the cap.
After Constraint 01 and Constraint 02 are both calculated, the lesser of the two amounts is the financing available per parcel.
Estimate financing capacity per parcel.
Plug in your project assumptions. The calculator applies both the finished-lot-value collateral floor and the 2% total tax cap to size the supportable per-parcel principal.
Inputs
Assumptions
Finished lot value: 20%–30% of home value
INSITE new assessment rate: 0.50% of home value / yr
30-year tax assessment based.
Results
Financing per parcel
$57,500
Lesser of Constraint 01 and Constraint 02.
Total project financing
$2,875,000
Across 50 parcels.
Finished lot value
23% of finished home value
$230,000
Lot-based financing (25% of lot)
Constraint 01
$57,500
Tax-supported financing
Constraint 02 — 0.50% assessment, 30 yr
$70,705
Annual assessment per parcel
0.407% of home value — 5.75% amortized over 30 yrs
$4,066
Illustrative only. Final sizing depends on issuer policy, market conditions, debt-service coverage, and reserve requirements.