Surprisingly, purchasing vacant land can require more research and fact-checking than buying a pre-existing structure. While buying a completed dwelling may seem complex in itself, land buyers can often become overwhelmed with the required research that goes into buying a parcel of land. Doing the groundwork and being thorough can make the difference between a successful land purchase and a poor investment. Although every situation and piece of dirt is different, there are some general guidelines to follow when purchasing vacant land.
Your intended use of the land plays a big part in deciding where and when to buy. Depending on location, there will probably be certain guidelines that may limit the parcel's intended purpose. These guidelines are referred to as zoning codes, and the first rule of thumb is to check with your local planning department to see if your intended use will coincide. For example, a single-family dwelling will not be permitted in a commercially zoned area, while farm animals may not be allowed in many residential zones.
Covenants and Restrictions
In addition to local zoning codes, there may be neighborhood covenants and restrictions attached to the property. Basically, these are the "rules" of the neighborhood, and may be enforced by a homeowner's association. Covenants may set forth restrictions regarding the type of building materials used, the number of dwellings per parcel or the minimum square footage. Your local title company will have a copy of any recorded covenants pertaining to the lot you have in mind.
It's crucial to check the availability of utilities such as water and sewage to the property. What can seem like a great bargain can often turn into a real headache if you purchase land with no available utilities and no easy solutions. You should always check water availability and drilling estimates required for well digging. Additionally, a perc test may be required to determine soil suitability for any septic waste disposal systems.
Many vacant land parcels have limited access, or no access at all, which may mean you may have no legal way to get to your property. This situation is referred to as being "land-locked." Although a dirt road leading to the lot may look like a driveway, it may belong to someone else and be considered trespassing to travel on it. Additionally, many land parcels have a shared maintenance agreement between two or more local landowners who share the same access road.
Not only is it important to consider present factors that may influence your land-buying decisions, but it's also crucial to look ahead to what might be planned in the future. Talking with your local planning department about future development in the area can make all the difference in the world if you suddenly find out that a meat processing plant or pig farm will be neighboring next to your land. It pays to do your homework, for today and tomorrow.
Meribeth Phipps has been a real estate broker since 2000, specializing in residential new home sales. She holds a bachelor's degree in business and marketing.