Do you have any plans to spend your money and buy land? You will be able to complete the transaction quickly, without even leaving your home. However, there are a few important things that you will need to keep in your mind before you buy cheap land for sale. It is recommended to take your time and pay attention to these factors. Then you will be able to end up making the right investment. This will help you to get the maximum return out of your investment and to stay away from facing regretful situations.
1. Explore the surroundings
Before you commit to buy land, you should take your time to explore the surroundings. It is even better if you can speak to the potential neighbors. Then you will be able to get a better overall understanding of whether you should be spending your money on the property or not.
You never want to spend your money and buy a property that will drive you crazy. Property sellers might not tell truth about the land to you at all times. Therefore, it is a must to do some research on your own. Then you will be able to understand what it is like to purchase land. You should also take a map and see the surroundings. In the meantime, you need to see how the surroundings can create an impact on your property. This is where you will need to pay special attention to the cell phone towers, power lines, and the major interstates. You should even focus on small establishments around the land, such as chicken farms, as they are going to create an impact on your living experience.
2. Understand what you want
You need to have a clear understanding of what you want before you spend your money to buy a property. This may sound obvious, but we often see how most property buyers fail to pay attention to this fact. As a result, we see them struggling with their investments.
It is important to have realistic expectations. For example, you might be planning to use the land you buy to set up a solar farm. In such a situation, you should not purchase a piece of land in one of the northern states. Instead, you should buy land for investment from a state like Florida. Then you will be able to generate solar energy throughout the year.
3. Be mindful of the restrictions
There are certain restrictions that you will need to adhere to, as you continue to use your land. It is important to have a clear understanding of these restrictions as well. Then you will not end up with any disappointment after completing the transactions.
You need to understand the legal restrictions by having a quick chat with a lawyer. However, your property seller will also be able to provide a basic understanding to you about the restrictions. Make sure that you are not restricted from executing your plans after the purchase of your property. Then you will not have to deal with any disappointment.
4. Understand the cost of converting raw land into a developed land
After land investment transaction is completed, you will have to spend further money to convert the raw land to developed land. If you have any plans to do this, you will need to understand the cost associated with it as well. For example, if you are going to have driveways in a land that has a forest or hills, you will have to spend a lot of money. In such a situation, you will not be able to get the maximum return out of your investment. This is why you will need to understand the cost of transforming your land to match your preferences and see whether it is worth the purchase.
5. See what utilities are available
You must also take a look at the utilities that are available in the land you invest before you commit to purchase. Failing to take a look at the utilities will be a big mistake that you can do. That’s because you will not be able to proceed with your investment ideas without having access to all the utilities that you want.
For example, if your land is located in an extremely rural area, you will not be able to get an internet connection with ease. Therefore, you will not be able to have a hotel or a holiday home there. This will force you to look for another property.
6. Learn the cost of acreage in the surrounding areas
When you buy cheap land, you need to make sure that you are purchasing it at the right price. This is where you should do a bit of research and understand the cost of acreage in the surrounding areas. You should have a comprehensive understanding of this before you make an offer. Then you will be able to confirm the fact that you are not being scammed by the seller to purchase property at an outrageous price.
By doing a bit of background research on the price, you will be able to secure the best deal. This will help you to get the maximum return out of your investment as well.
7. Be mindful about zooming of land
You should learn how your land is zoned before you buy it. For example, it can be zoned under agricultural, commercial, residential, or green belt. By taking a look at this factor, you can ensure that you purchase the right piece of land that matches your preferences. This will eventually help you to stay away from the future struggle that you have to go through in order to get the house rezoned.
If there is a need to rezone the land, you will need to ask the property owner to do it. In most instances, property owners are more than happy to help you with such matters. This will help you to refrain from going through the struggles on your own.
8. Check if you can get a land construction loan
If you have any plans to proceed with constructing a building on the property within one year of buying it, you will go for a land construction loan. That’s because it will help you to save some money. You can reach out to your bank and check whether they can provide a construction loan. Then you will be able to roll that loan into your permanent mortgage. This will help you to refrain from closing twice.
However, there are some maximum limitations on the amount of money that you will be able to borrow. If you can afford to get the construction done within your budget and the maximum amount allowed to get, you should go for it. This will help you to save a lot of money in the long run.
9. Do a soil test
It is better if you can do a perk test or a soil test when buying land for investment. There are companies that can offer this service to you. You just need to get in touch with one of those companies and explain your needs. Based on that, you can get the experts to come to your location and offer the service.
Based on the soil test, you will be able to determine whether the land that you are going to buy is located on top of a flood plain or not. On the other hand, you will also be able to understand whether the land is sitting on top of an old mine. Based on the soil test, you can go ahead with your investment.
10. Take a look at the previous contracts
You should ask the realtor to provide you with copies of previous contracts. After you get the contracts, you should carefully go through them as well. By going through previous contracts, you will be able to get some valuable insights related to the land that you are about to purchase.
For example, you might figure out that your land is in a flood zone. Hence, you will not be able to get finance from a bank to buy the property. Instead of dealing with such problems in the future, it is better to take a look at the previous contracts and ensure that you are completely safe.
11. Understand the proximity to the roads
People who buy land that is available for sale in rural areas should also understand the proximity to roads. Otherwise, you will have to deal with numerous challenges when you are trying to access the road and get all other transportation requirements catered to.
It is better if the rural land is located closer to a properly maintained roadway. Then you will be able to access transportation facilities without encountering a problem. This will help you to have easy access to nearby cities and towns, which can help you to get the required services.
12. See what natural disasters your land is vulnerable to
Certain areas of the world are more vulnerable to natural disasters when compared to the rest. Hence, you should learn what natural disasters that your land is vulnerable to. For example, you will need to check and confirm that your land is not located in an area that is highly vulnerable to flooding. Make sure that there are no frequent natural disasters taking place around the property. Then you will be able to keep the peace of mind after you spend your money to buy it.
13. Check if your land is on an incline
You will be able to get land on incline surfaces at a lower price than others. However, such land comes to you with some challenges. Therefore, you should be mindful of the challenges before you spend your money to go for the investments. However, there are some opportunities that an inclined land can provide as well. You should understand your long term goals in mind and then invest money to purchase the property.
For example, land that is located in an incline will lead you to more expensive property development costs. You will also have to focus more on construction planning. Make sure that the land can cater to your needs before you buy.
14. Don’t ignore annual property taxes
When it comes to raw land investing, you prefer to keep your expenses low as much as possible. This is why you shouldn’t ignore the annual property taxes. If the property tax is too high, you might not be able to get the return that you wish to get out of your property as expected. Hence, you will need to do your own research and understand how much money you will have to spend on annual taxes. It is reasonable to pay a tax rate that falls between 1% to 4% of the market value of the property.
15. Check the shape and size of the land
You must also take a look at the shape and size of the land that you are about to buy. It should also match your preferences. Then you will be able to use it according to the preferences that you have.
In case if you are planning to buy a block of land that has an odd shape, you will need to use your common sense. Then you will be able to determine whether you are making the right choice by purchasing that property or not. You will be able to access the GIS mapping system of your county and get all the information you want related to the shape and size of the land.
Now you are aware of 15 things that you need to consider before you invest your money to buy a piece of land. Always stick to these facts and you will be able to end up making the right decision.