Top 3 Questions to Ask When Buying Land

With home prices constantly rising over the past few years, many potential homebuyers are considering buying land to build on rather than waiting for the perfect house to come on the market at their price point. Purchasing land can seem like a quick, easy option, especially if you are willing to look outside of major metropolitan areas where prices can still be (relatively) reasonable. However, there are several details about buying land that you should know before making a purchase. I always advise using a buyer’s agent to help discover any potential issue and ensure the land is appropriate for what you want to build when you are considering this option.

Here are three general questions to keep in mind:

Is it possible to build what you want on the lot?

You need to know the zoning and any deed restrictions and/or restrictive covenants that apply to the land. There may be restrictions on types of construction (stick-built/modular/mobile), square footage requirements/minimums, set-backs from the property lines, types of uses (farm use or business use restrictions), allowability of outbuildings, and so much more. Additionally, if the property is in a community with a homeowner’s association, there will be even more guidelines to follow. You definitely want to know that your vision can become a reality on the property you purchase. A US News & World Report article cautions to not assume that you can have a property rezoned. “Getting an exception to the rule isn’t easy, and there’s a good chance it will be denied.” The article advises: “Rather than trying to rezone property, it’s best to keep your vision within existing limits. Seek land that will allow you to build the home you want, but know your plot’s restrictions before finalizing the plans.”

What are your options for utilities and water?

Does the property have access to existing power lines, water, and sewer system, or will you need to dig a well and install a septic system? If a septic system is necessary, you’ll want to know if there has been a perc test done in the past (and is it still valid), or do you need to have one done. A perc test can tell you if you can install a septic system, and if a conventional system or a much more expensive alternative system will be necessary. If you’re thinking about going totally off-grid and not relying on an outside system for electricity, consider this to be another aspect of the first question – is it possible to build what you want. Zoning or other restrictions may not allow for off-grid builds.

This quote by Mark Twain is still true today. Land can be a very good investment, in addition to a good option for making your dream home a reality.

Are property lines marked, and what’s on the other side of them?

Knowing the answer to this question can help you avoid many headaches down the road. You want to be certain that you know where you can build on the property, and if anything of the neighbors (e.g., outbuildings, fences, driveways) is encroaching on the property. You also may be able to find out if there are any development proposals for neighboring land or properties. If you think this isn’t important, imagine buying land and then finding out the property behind your is zoned industrial, and they already have the approval to build a factory.

These are just a few of the questions you should have answers to before buying land to build on. Other areas of concern include taxes, nearby environmental hazards, property access, liens or encumbrances on the property, mineral rights under the property, right of ways or easement across the property, and more. 

Do you need a referral to a buyer’s agent to help you investigate land to build your dream home? Feel free to get in touch with me. I always recommend consulting with a licensed real estate agent, financial advisor/mortgage professional, and/or legal professional before making any financial/real estate decisions.

Do you have any experience buying land or stories about building on vacant land? Share them in the comments below!

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