When planning to build a home, among the most crucial first steps is purchasing vacant land at an ideal location. While there are plenty of upsides to investing in a lot, there are several factors to consider including property boundaries, land topography, zoning restrictions, and price, among others. To avoid the pitfalls when buying, work with a real estate agent and follow these do’s and don’ts.
Work with a professional.
Choose a real estate agent with extensive experience who can walk you through the entire process, including negotiations, due diligence, and paperwork. Hire someone who is adept at handling land transactions and familiar with the area to get the best deal.
Consider your budget.
Bear in mind that getting a loan for land purchase is entirely different from buying a home. Creditors are wary of approving loans for raw land since they don’t have any collateral to hold. At the most, some lenders are willing to give 40% of the purchase price, so make sure you have enough cash to pay upfront.
Learn about zoning restrictions.
Check with local authorities to know zoning restrictions and development limitations in your targeted area. Since these city or county ordinances tend to change over time, determine whether there are proposed revisions. Keep in mind that local governments tend to be strict about codes and limits; consult an experienced real estate agent to advise you on rules that you aren’t clear on.
Skip on doing research.
Some locations will be better suited to your needs than others, so do your homework to find the right spot. Imagine living in the area for a long time and ask yourself what your primary considerations should be. Does the district have enough amenities or is it situated in a safe neighborhood? Find out the value of homes in the area to gauge how much to invest in new construction.
Forget to conduct a survey.
When you’re investing in raw land, consider the area’s existing infrastructure and utilities. Unlike built homes, some vacant land may not have access to water, electricity, and a sewage system. Determine if there had been contamination from prior use, potential environmental hazards, or possible encroachment on your property.
Talk to the neighbors.
While it is necessary to be friendly with your neighbors, avoid disclosing too much about your plans. People who are used to having a vacant lot nearby might not be enthusiastic to have a newcomer in their midst. They can use collected information against you, so keep some distance for the time being.
Ready to build your dream home? Let the experienced real estate agents at Lawrence Realty Inc. help you find the right plot of land for sale. Based in Red Wing, MN, their team of local agents has been providing outstanding services to their commercial and residential clients since 1948. Call (651) 388-4745 to schedule a consultation or browse their real estate listings online.