Building your own home is a dream for many people. The first step is to buy the lot where your new home will stand, which can be challenging to navigate if it’s your first time doing so. Along with working with a trusted local realtor, here are a few tips to help you make the right decision.

Do:

Prepare for the loan application process.

Buying land is not like buying a home when it comes to the loan process. Traditional home loans can be sold on mortgage markets, which helps lenders lower their risk. This is not the case when buying loans, so many lenders have stricter standards. For example, you might be asked for a larger down payment than the traditional 20% associated with home loans. Know how much you can spend before applying for a loan.

Work with a local realtor.

Finding empty plots of land is more difficult than locating homes for sale, as existing homes tend to be more plentiful. That’s why you should work with a local realtor with an expansive knowledge of the area you’re searching in. Your realtor should also have experience with land purchases, particularly when it comes to financing.

Don’t:

Neglect the land survey.

Land surveys provide a strict understanding of a property’s boundaries. They also map out a piece of land so that you’re fully aware of the smartest spot to build a house. Surveys also provide information about drainage and other features. Some states insist that homebuilders conduct surveys before getting started.

Forget about home values in the area.

Building a home is a significant investment. When choosing a plot, ensure the home you intend to build matches other houses in the area when it comes to price. Lenders are sometimes reluctant to provide financing when there are significant disparities between the values of homes. Selling a home that outpaces others in the area in terms of value is also more difficult, which can become an issue later on.

Justyna Johnson – ExP Realty is recognized throughout Woodbury, MN, and the surrounding areas as a top real estate agent, whether you’re buying a home or a plot of land. She provides a wide range of services, from locating the perfect property to finding suitable home insurance. She also provides a TRUSTimate — a free online property report that offers an accurate assessment to aid in your decision. Text HOME to (651) 501-2345 to receive your report, or call the same number to schedule an appointment with this local realtor. Visit her website to look into buying a property.