Buying Vacant Land: What You Need to Know
Did you know that upwards of 47% of the United States is vacant land?
Regardless of whether you want to use the property for your own needs or as an investment, buying undeveloped land can be an exciting and rewarding experience. Before making a purchase, there are many crucial considerations to make.
Keep reading to learn how to buy vacant land and what factors to consider when making a purchase.
When purchasing vacant land, location is the most crucial consideration. The possible uses and value of the land might be influenced by its location.
Consider aspects like proximity to local infrastructure such as schools, hospitals, and shopping. Visibility, accessibility, and zoning restrictions may be important to take into account when purchasing land for commercial use.
Consider the Impact of Local Zoning
What you may and may not do with the land is governed by zoning restrictions. You must be aware of the zoning regulations that govern a piece of land before purchasing it.
Research any zoning law changes that are being considered. They may have an impact on your plans for the property.
Know the Property Boundaries
You must understand the boundary lines of the property you’re purchasing. This is increasingly true for vacant properties, which may have more disputes over where the property lines are located. Working with a land surveyor at Alta Land Survey will help you learn more about the vacant property.
By knowing the property lines, you may be able to settle any boundary problems with your neighbors. To make sure you are aware of the exact location of the property borders, you can have a qualified surveyor do a survey of the land.
Look for Access to Utilities
When purchasing vacant land, access to utilities is a crucial factor to take into account. The possible use of the land may be limited if it is difficult to reach.
You want to determine whether the property has access to amenities like electricity, water, and sewage. Otherwise, you might need to take into account the price of installing these utilities.
Consider the Land’s Potential for Development
The value and use of the land can be affected by environmental factors such as soil quality and water sources. Before buying, you should investigate any potential environmental factors that may have an impact on the land before purchasing it.
This can help you to make sure the site is suitable for your intended use. You might need to conduct environmental studies or tests.
Weigh the Different Financing Options
The financing alternatives available for vacant land may be different from those for homes or businesses. Your choices may be rather limited.
Lenders can be wary about making loans for purchases of vacant land. Alternative financing options like seller financing or private lenders may be something you need to think about.
Work with a Real Estate Agent
A real estate agent’s help can be useful when navigating the vacant land purchase procedure.
A skilled agent can aid you in locating houses that fit your requirements, negotiating the purchase price, and assisting you with the closing procedure.
Invest in Vacant Land
Buying vacant land can be a complex process that requires careful consideration of many factors. By keeping these key considerations in mind and doing your due diligence, you can make a well-informed decision and purchase a piece of land that meets your needs and goals.
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Everything You Should Know About Buying Vacant Land in Canada
Here are eight things that you should know when purchasing vacant land in the Canadian housing market:
1 An Investment Opportunity
Buying vacant land can serve as a tremendous investment opportunity to generate steady income or save for retirement. Depending on where you live, there are so many ways that you can utilize this land, from operating it as a rental property to using it for commercial purposes. Indeed, one of the key advantages of buying vacant land is that you can decide what you want to do with it.
2 Conduct or Review Recent Surveys
Land surveys are critical for land buyers. The purpose is to determine the property’s legal boundaries and easements. Unless the survey was done within the last year or two, it is essential that you conduct a survey with your name attached to the endeavour. You can hire a professional firm to help you begin the rigorous process. Costs will vary on the size of the land survey.
3 Know the Costs of Developing the Vacant Land
So, without existing infrastructure on the vacant property, you will need to develop it yourself. Indeed, this goes beyond just putting together lumber and building kitchens. Instead, you will need to clean and level the land, access power lines, and identify water and sewage solutions. Suffice it to say, there is much to do when buying vacant land, which can be pretty expensive.
4 Where Are the Roads and Utilities?
Be it residential or industrial property, you need to ensure that your land is near utilities, such as power lines, phone lines, a water main, water and gas. This can be difficult to secure in a remote area. If the property is very remote, you may need to plan to go off-grid with solar power, which will depend on local law. Investigate the rules associated with incorporated versus unincorporated townships – some will allow greater flexibility than others. In addition, when you are exploring vacant lands, it would be prudent to locate well-maintained roads enabling easy access to essential services.
5 Understand Zoning Laws
The objective of zoning laws is to differentiate the property between commercial, industrial, and residential. Therefore, it is your job – with the help of your real estate agent – to discover which zoning laws apply to the area you want to buy. Of course, you can always apply for rezoning the property, which requires research and due diligence.
6 Request a List of Restrictions
While you’re researching the zoning laws, request a list of restrictions, such as constructing a fence, parking a certain number of automobiles, or the height of any building built on the land. While you can always negotiate changes to the list, especially if they are outdated, it is always best to develop within the confines of these restrictions.
7 Natural Disasters
Canada’s remote areas are more prone to natural disasters than jurisdictions closer to city centers. Some of these regions will see flooding, tornados, and severe snowstorms. This can be harder to handle when you live in an unpopulated part of the country. Therefore, it is imperative not to have vacant land that is more vulnerable to these devastating events since it could threaten life and the property might not be insured.
The last thing you need to determine is the type of mortgage that you will be applying for as you develop the vacant land. Here are some of your options:
- Land Mortgage: This is similar to a residential mortgage, except the chief difference is that you will need to put down a more significant down payment and pay higher interest rates.
- Construction Mortgage: This is the type of loan utilized to acquire vacant land so you can build on top.
- Agricultural Loan: If the sole purpose of this vacant land is to develop agriculture, you can apply for agriculture-related loans, such as the Canadian Agricultural Loans Act (CALA) offered by the federal government.
Building a home, farm, or commercial property from scratch can offer immense opportunities. Everything is new, and you can design it the way you want. It is truly an incredible feeling.