Whether you’re purchasing residential land to build your dream home or for investment intention, it’s essential to know what to search for when looking for vacant land. Purchasing land is not like Purchasing a home, and the process can be complicated if you are inexperienced.
Here’s what to look for when looking for your dreamland:
- A Buildable Lot
First of all, you want to look for buildable lots. However, be forewarned that there are different definitions for the term buildable. To some, buildable simply means that the city or county you live in will permit you to build on the site. To others, the term buildable is utilized to describe the land’s characteristics. Maybe the property has very gentle sloping and high acreage, which doesn’t say much for the true development potential the property has.
Normally, the location of the land is also important. Research the area to find out more about jobs, local schools, grocery stores, medical facilities, and entertainment. Finding a lot in a desirable area will give you a better return on your investment.
- Covenants, Conditions, and Restrictions
Once looking for a piece of residential land, you’ll require to decide whether you are going to build on an unrestricted subdivision or a restricted subdivision.
Unrestricted Subdivision: Unrestricted subdivisions don’t have a POA or HOA. These sections don’t have an enforcement committee that assures land values or works to keep a particular appearance. That said, unrestricted subdivisions may still have restrictions in place that are imposed by the state, city, or county. Such restrictions are mentioned in the deed to the property.
Restricted Subdivision: In a restricted subdivision, deed restrictions are implemented by the initial developer. These restrictions differ for each master-planned community and subdivision, and are applied by either a Property Owners Association, or a HomeOwners Association. In the subdivisions, homeowners will be needed to comply with these restrictions to protect land values. Some limitations might include the size of the home, how many homes can be built on a lot, types of homes that can be built, and even rules about pets or other animals.
HOA or POA fees will require to be paid either monthly or yearly to assist maintain the subdivision’s roads, signs, pools, and any other improvements that may be essential.
Depending on your plans, you may decide to buy land in an unrestricted subdivision where there aren’t lots of rules and limitations that may prevent you from building your dream.
- Zoning and Utilities
Even if you already know that the property you are considering is zoned residential, it’s significant to make sure that the surrounding areas are not zoned differently. For example, if land that surrounds the property is zoned commercial, buildings can be erected for industrial use. If land is zoned agricultural, a farm can be put in with large numbers of livestock. Either of these situations can make living conditions unfavorable. Ideally, land that surrounds the property will also be zoned for residential purposes.
It’s also important to find out if utilities are already on-site, or if you have to run them yourself. Are there water, sewer, gas, cable, and telephone service connections available? If not, you’ll need to contact the service provider and have a line run for an added fee.
- Possible Environmental Hazards
Ensure that the property you are considering is free of any possible environmental dangers. This may include fuel or chemical storage tanks, or contaminated water or soil. Before purchasing any piece of land, it’s important to have a phase 1 environmental study performed to ensure that there is no contamination on the land.
- Easements, Home Placement, and Neighbors
Another important consideration: who will have access to your land? Access can include oil companies, natural gas companies, utility companies, and even easements that permit access to neighboring properties. Any appointed easements will have a serious effect on where you can build your home, so it’s essential to determine the location of any easements on the land.
With set back lines and easements in mind, it’s important to consider where you will be able to place the home. Again, these two factors will affect where you can actually build the home, so make sure these two conditions are favorable when buying property.
Another thing to think about is neighboring property. It may seem trivial, however, it’s important to know who your future neighbors will be. No matter how much acreage you buy, the way your neighbors maintain their properties will affect the value of your land even if you can’t see their land from yours.
- High-Growth Areas
If you’re buying residential land and developing for investment intention, you want to look for properties in high-growth areas. These are sections where populations and economies are growing, which means that properties are in higher demand.
Land in high-growth sections will provide you with a magnificent return on your investment. Normally, plots of land that are closer to bigger cities are the best option. Rural properties can provide you with a great return, however are not as valuable. This is because these properties are so far away from local jobs, nightlife, medical facilities, shopping and entertainment.
When purchasing residential land, it’s crucial to ensure that the property undergoes several inspections before you commit to buy. It’s important to make sure that there’s no soil or water contamination, and that conditions on the land are favorable for building.