It may be that most people purchase undeveloped land with the intention of building their dream home, site however, nurse there are other reasons for buying vacant land as well. Vacant land is also a wise investment for developers, subdividers, or land speculators. Investing in land does require some research, or you could end up paying way too much for land that is essentially worthless. Despite the current state of the real estate market, many undeveloped properties are currently undervalued, especially when you take into consideration easy methods to make quick money, such as subdividing a larger property.
So what should you do if you’ve found some vacant land you’re interested in buying? Don’t just purchase the land based on what you think it may be. It’s vital to actually visit the land and walk around to see it for what it really is. Don’t just rely on a map, or worse yet, the seller’s description. For example, you may find that there are no roads to access your land. Obviously, this will hurt its investment potential. There are many features of the land that simply can easily be overlooked on a map or the seller’s view of the land, but are easily seen when you set foot on the property.
Before buying anything (vacant or developed) you must have a land surveyor conduct a survey of it. Depending on what kind of survey is right for your situation, the survey can include boundaries, slope and layout, natural features, roads and utilities, and other features that will affect the value/price of the land.
Some aspects of buying undeveloped land are completely different than buying a property with a house already present. Keep in mind that when buying vacant land there is no proof that a house ever could be built on it. It’s up to you to do your excellent homework in determining whether the land will meet your needs. Before you invest, find out four key features of the land:
- First, how is the lay of the land? Avoid properties in flood zones or with sharp hills, rough terrain, or other undesirable features that may make developing the land an uphill process. Also, avoid oddly shaped lots in favor of rectangular or square ones, which will be easier to sell.
- Second, how accessible is it? Are there paved roads, and are they well maintained?
- Third, is there a source for utilities, including water, electricity, and wastewater? If not, you’ll be hard pressed to find a buyer who wants to build there.
- Finally, how is the location of the property? Will it make a good residential location? Is the area projected to grow? Is it an up-and-coming area where real estate is likely to appreciate?
Before investing in vacant land, know what you’re going to do with it. You could build a home or another structure, and then sell the property as developed land. You could have the land re-surveyed and subdivided into several smaller properties, which can then be sold to individual buyers. Or, you can keep the land as an investment for a few years until its value has increased. If you have a definite plan in mind, check zoning regulations and other rules to be sure that you can follow through with it on the site you have selected.