Tips on How to Buy Land
Looking for tips on how to buy land? You came to the right place! A lot of people dream of owning land. It is a space and place that provides growth, opportunity, and enjoyment. So whether you are building a home, growing a family, or preparing for retirement, it has uses for just about everyone.
While buying a piece of land appears easy, the process can be very challenging. Without carefully planning the purchase, your investment can run into challenges and you might encounter a lot of risks. What do you really need to consider when buying land?
Research Land Fundamentals
We all know that land is an immovable asset. If you find land in the market that is affordable, you have to check and assess the land’s characteristics and make certain you know what you’re getting. Is the location good? What about the physical characteristics such as slope or type of soil? These are just some of the things that can affect the overall value of the land. It might cost less to acquire the property, but you might spend a lot more to make it safe and habitable.
It’s always a good idea to check and compare properties to know if what you are considering is actually a good investment.
Are you planning to use the land for residential purposes? Check its accessibility. The best way to confirm this is connect with the county’s property division.
Land is often times landlocked and not accessible. So it’s best if the land you are considering is on a county-maintained road. If it’s an overgrown path deep in the woods, it might not be sustainable and something you can count on in the long run. So it’s best if you have legal access on a maintained road.
Questions to Ask the Seller and Property Appraiser
Ask a lot of questions of the seller and property appraiser when you get them on the phone or meet with them:
- Does the property have water and power to the property line?
(this might not be important to you depending on your use intent, but it’s still good to know)
- Does the property have sewage or septic?
- Seller’s name and contact info?
- Is the Seller the Owner?
- Are all owners alive to sign?
- What is the zoning on the property?
- Are there are any property restrictions?
(some properties do not allow for a structure or mobile home)
- Are there hunting restrictions if you plan to hunt?
- What is the property’s access? Does it have full legal access?
- Does the county planning department have any plans for the area?
(like a future interstate)
- How quickly would the seller like to complete the transaction?
- What does the seller want to get out of it?
- Any other parcels for sale adjacent on nearby? (you might be able to get a steal on a second piece of property)
- Who owns the surrounding property?
- Parcel APN
- Legal parcel size
- Tax Situation (are real estate taxes current?)
- Is there an HOA or POA for the property?
- Confirm the name(s) on the Deed
- Do the comps in the area support the offer price?
(you can use sites like Zillow to check comps)
- Is seller financing an option? (this is more common than you think, as many banks will not lend on vacant land)
Review Your Financing Options
Land is always harder to get a loan for, compared to other types of loans. There are many reasons for this, but one of the most common is that loan institutions think that a house and lot property has more value. So borrowers are not going to walk away from their financial obligations as easily. With undeveloped land, the security to finish the loan is not the same.
If you choose to invest in land, check the many options available for you financially. Buying land from developers for residential purposes will usually be more expensive but an easier transaction. They are more experienced at securing things such as environmental testing, and other site preparation. Building on undeveloped land, however, will mean bringing utilities, sewer systems, and other requirements to make it habitable.
Don’t hesitate to get the services of a professional. It is money well spent. Navigating through the sea of options can be overwhelming. A steady hand that knows the way around will help avoid future problems, and this can be very valuable insurance. If you are not sure where or how to start, getting the help of a professional might be your best option.
Real estate professionals or brokers understand the market, and will provide you with inside knowledge on different properties. The key here is to hire a local agent. If they are not familiar with the area, they won’t be of much help. But a good local pro can help with the various types of financing available for land purchases, things to look out for, and lots more valuable insight.