How To Buy Land
If you are thinking about investing in land, you should know a few things. Buying land can be an enjoyable experience and a wonderful investment, but it is important to avoid making big mistakes when you are looking at spending a substantial amount of money. Therefore, we have put together this article to provide you with pro tips and resources to make it easier and safer to buy land.
Buying land starts with understanding the purpose of the land. You may want to buy land for establishing an investment property, creating a hobby farm, or building your home. When searching for a good property, auction agencies, real estate agents, property listing websites, land brokers, and government agencies can offer guidance on where to look. Continue reading and learn how to buy raw land.
How to Find Good Land for Sale
Location is the first consideration when scouting for good land. Land in rural agricultural settings is cheaper than land that is near urban areas. Amenities such as sewer, electricity, phone services, and water systems should also factor into your decision-making process when looking for the perfect property.
Due Diligence
When buying land, thorough background checks may save you from making avoidable mistakes and oversight. These background checks include doing environmental tests and conducting a survey. Environmental tests will help you know if the land is viable for future development while a surveyor will save you from future encroachment disputes.
What to Look Out For When Buying Land
- Ensure that the land you are interested in is not in a flooding zone. Government policies may not allow you to build in flooding zones.
- Avoid buying landlocked properties. Landlocked pieces of land are cut off from amenities such as driveways by other properties. Ensure that you have access to the property you are interested in purchasing.
- Building restrictions should also inform you of your buying decision. Ensure that you have all the rights you need for the land that you buy. If the land has any form of easements, they may hinder your development plans.
Financing Your Purchase of Land
When you’re considering financing options, bear in mind the banks aren’t always experts in evaluating the land you wish to purchase. The value of land has countless variables and is difficult for lenders to determine, so they may take extra caution in considering loans.
That said, your local bank is typically a great first option. A community bank has a better understanding of your local area, as well as the value of its real estate. Sometimes you will have the option of owner-financed payment options. This allows you to avoid traditional lending and work out a payment schedule with the current owner.
If you are buying in cash, in many cases you can get a better deal. A cash buyer has greater negotiating power, and the overall purchase cost is lower when buying in cash. You can also choose to lease with an option for purchase. The terms in this arrangement are specific to the contract you sign with the seller.
How to Finalize the Purchase
Review your commitment to the financial amenities provided by your lender and ensure you understand them. Get all the documentation you need to finalize the purchase and make sure that all the inspections are complete. Tour the land you are purchasing and be sure it’s in good condition. Make sure you also pay for the title insurance to protect yourself from any future issues.
So, there you have the big things to know when purchasing land. Now you’re equipped to buy land with confidence and to find the best property to match your unique desires. If you find quality land in the right location for the right price, it matches the specific features and criteria you have for it, and no hidden problems show up during the due diligence, you are good to go!
