Definition
Impact fees are basically charges new development has to pay toward infrastructure. If you're building houses, you're paying fees to cover roads, schools, and utilities needed to support your development. It's a legitimate cost but it significantly impacts project feasibility and profit potential.
Where you’ll meet it
How do I read a developer's offer?
See it in Selling land · Step 4About this term
Impact fees cover roads, schools, utilities, and other infrastructure needed to support new development. Fees increase development costs and vary significantly by location.
Pro Tip
Get impact fee estimates early in your planning. These fees can reach $15,000-$30,000 per unit in high-growth areas. If they're that high, your project might not pencil out financially.
Example
Impact fees of $15,000 per unit for a residential development to cover road and school infrastructure.