Buying land, either for your own use or as an investment, can be a complex process, especially if you’re unfamiliar with how these types of real estate purchases are conducted. While buying a vacant lot of land frees you from the hassles associated with home inspections and repairs, there are other issues you will need to address. Familiarizing yourself with the process of buying land can help you avoid many costly pitfalls.
Find Potential Plots
You might already know that most of the land in the United States has already been developed, especially when looking near towns and cities. This means there are few plots of land in comparison to land that already has structures of some kind. Among those plots of land, even fewer are on the market at any one time. For this reason, you may need to work with a real estate agent to help you find parcels of land to suit your needs. When you work with an agent who makes use of Realestate CRM Arosoft software, you’ll have access to the latest properties. Your agent can use computer software and online resources to help you find the types of properties you’re looking for in a shorter period of time.
Evaluating Your Land
Since you’re not concerned with the number of bedrooms, full baths, and the other concerns that go into buying a home, you might think that buying land is a little easier. This is certainly true, but that doesn’t mean it’s unnecessary to tour the land yourself. In fact, you may have to conduct a deeper examination of the land to ensure this is the right parcel for you. For instance, if the land is away from the city, there may be farms nearby and, while that may sound nice, keep in mind that this means a large population of livestock. If you plan to build a home on the property, will you and your family be able to tolerate the sounds and odors that accompany live animals? Is the property near railroad tracks, or near an airport? Just as you would do in buying a home, it may be wise to visit the land at different times during the day and evening to determine what other environmental factors may affect your decision to buy.
Research the Plot of Land
Even after you have visited the plot of land yourself, there is still more to be done in determining the quality of the land. For instance, is there access to utilities nearby? If not, you may end up having to pay to have power lines, sewer lines, and gas pipes laid out to meet your property. It’s also important to make sure there’s access to your property from the road. Some plots of land are situated between other properties and the nearest road, which may mean having to pay other landowners for permission to cross their property. Surveys and deed searches will help you avoid these problems ahead of time.
Check into the Zoning Regulations
Unless you’re just going to use the land for camping or growing a garden, you’ll probably want to make plans for development. This means checking into the zoning laws that affect the area. If the area isn’t zoned for the type of structure you plan to build, you may need to apply for a special permit. While this may not be a considerable expense, it will require your attention before you start making any specific plans.
Making an Offer on the Land
At some point, you’ll be ready to make an offer on the land. Even if the asking price falls within your budget, it’s wise to negotiate for a lower price. Especially in a buyer’s market, it makes sense to try to buy land at a discount. The less you pay for the land, the more money you’ll be making on your investment. Even if you plan to build a home to live in, saving money on the land purchase will help you cut your overall costs. Every little bit you can save will help you on the total cost of your project.
Paying for Your Land
Once you’ve determined this plot of land is a good investment, you’ll begin the purchase of the property. All of your hard work has paid off, but you’re not out of the woods yet. Have you determined how you’ll pay for the land? If you considered financing the purchase, you may want to rethink your options. Obtaining financing to buy a plot of land is often far more difficult than getting a regular home loan. This is largely because lenders know you’ll likely be financing the construction of a home or other building. The complexities involved in this process lead many people to simply pay cash for the land and, since land costs less than regular home purchases, it’s also much more feasible. Still, there are lenders willing to finance these types of transactions, if you can meet the credit qualifications.
Closing on the Land Purchase Transaction
Just like buying a house, there’s a closing process to buying a plot of land. By this point, you should have done all of your due diligence and all that’s left is the formality of paperwork. This is also the time at which the Transfer of Land should be finalized. This is an important step to consider, because this is a document that gives you the ownership rights to the land. Upon completing the closing, the land will be yours. Aside from property taxes, you should have no further expenses until you begin to develop the property.
When you’re ready to begin looking for a piece of land, keeping these steps in mind can help you. A familiarity with this process will help you get through the land purchase more efficiently, so you can keep your spending down. By the time the transaction is complete, you may have saved some money and you’ll be free to use the land however you choose.