IN BUYING LAND
Once you have a preliminary house design and budget in mind, your next step toward creating your new home is often to find the right piece of land. Buying land is very different from buying a house or condo, where most common problems can be easily recognized by a competent builder or home inspector. With vacant, undeveloped there are a host of other issues that affect the cost of development, and what can and cannot be built.
Even if you are very familiar with home construction, an undeveloped piece of land can hold many surprises both on and below the surface. Often the biggest surprise is the site development costs, which can be jaw-dropping. Your first job is to educate yourself at least enough to know what questions to ask – so you don’t get blindsided by the “unknown unknowns.”
Before you begin your search, take the time to establish a list of priorities. You probably can’t afford your perfect dream site, so you’ll need to decide where to compromise and where to stick to your guns. Some key factors to consider include:
- Commuting distance: How close, or far away, do you want to be from shopping, restaurants, doctors, and other businesses you visit regularly. How far are you willing to commute to shopping and work?
- Schools: Are you happy with the local school system?
- Physical characteristics. Are you looking for a wooded site, open land, high on hillside with views, near access to water? Are views important?
- Neighbors. Do you want a lot of privacy in a rural setting and room for horses? Or would you be happier in a densely settled development where you will see your neighbors regularly and where kids can will find plenty of playmates nearby?
- Municipal services: What private and municipal services are available: water, sewage, electricity, natural gas, cable, high-speed internet?
- Taxes and fees: Are local tax rates acceptable? Are you aware of the fees you will pay to build in this area: water, gas, and connection fees, impact fees, special assessments?
- Size: How large a lot do you need? Would a small lot adjacent to a large area of conservation land be preferable – it will probably be less expensive.
Once you find a building lot you like, run through the Land Buying Checklist to help you identify pros, cons, and open questions. Talk to neighbors and town officials about your plans. Get the opinions of town officials (building, planning, and health departments), in writing in possible. If questions remain, talk to local well drillers and septic system designers, and if necessary, geotechnical engineers familiar with the area. Eliminate as many uncertainties as possible before making an offer. Buying the wrong piece of land can be a very expensive learning experience.
The land you are considering may be completely undeveloped with no representations from the seller about its characteristics or usability –typically called “vacant land.” Or you may be looking at a fully developed lot in a subdivision with sewer, water, power, and gas already brought to the building site, along with a commitment to buy a design/build package from the developer. Or anything in between – for example, a lot in a rural development with a partially built unpaved road, designated lots, and no other improvements.
There are pros and cons to each. In general, vacant land will be less expensive but requires much greater knowledge and diligence on the part of the buyer. A developed building lot in a subdivision requires less investigation by the buyer, but is usually purchased at a premium. The more “developed” a lot is, the less development cost and risk the buyer assumes.
Not surprisingly, you will pay a premium for that – for both the infrastructure at the site (e.g., earthwork, well, and septic) as well as the peace of mind that the work has been done. However, a piece of “vacant” land can end up costing a lot more than a lot in a subdivision by the time you pay for the necessary permitting, infrastructure development, and utility hookups.
The lure of a large lot in the country is compelling for many people planning a custom home. The attractions are many: open space, beautiful views, peace and quiet, privacy, garden space, and perhaps room for a shop, studio, or even a horse barn. Also, you can generally get more land than you would in a subdivision for the same or less money, although after you add up all the development costs, some or all of those savings will disappear. Figuring your real out-of-pocket cost for a piece of vacant land takes a lot of homework.
A piece of undeveloped land can hold many secrets and requires a thorough investigation by the buyer. Caveat emptor (Let the buyer beware!) is the rule here. If you are not experienced in this area, and don’t wish to take time to educate yourself, and are not prepared to spend a lot of time and possibly some money investigating potential building sites, then you are probably better off buying land in a subdivision.
The list of potential surprises that may come with a piece of land is long. Many will restrict what you can do with the land, most have cost implications, and others will affect your quality of life on the land. The most important issues are covered below, but there may be others unique to your particular town or region. So look carefully before you leap in this direction.
While many of the issues discussed in this section pertain primarily to undeveloped land, even buyers in a subdivision would be wise to familiarize themselves with the wide range of land issues. Depending on the specific project, buyers may still need to deal with clearing land, building a driveway, well and septic systems, lot drainage, erosion control, excavation, landscaping, etc.
Also building in a development is no guarantee that your project will be free of site-related problems. When their house is complete, a homeowner may still be surprised to discover that that much of their backyard is underwater the following spring, or that their foundation has settled significantly, causing cracks in the concrete and problems throughout the house.
I’ve seen both these problems in semi-rural developments: the flooded lawns were caused by a series of swales (wide shallow drainage ditches) placed behind and between two homes, intended to direct the runoff from a large hill toward storm water drains. When spring came, the yards flooded, and after a fair amount of negotiation, the developer did come back and regrade the area solving most of the problem.
The other development was built on an extensive area of un-compacted fill brought in to raise the grade on one side of the road. Eventually, several homes, and sections of the road, were repaired by the developer, but at a much greater cost in terms of time, money, and personal distress (not to mention the involvement of lawyers).
Also infrastructure provided (or promised) by the developer may become your property, at least in part, once the development is completed. Private roads, community well and septic systems shared by the whole development, or shared systems used by two or more neighboring houses, are now yours to own and maintain, either individually or through a homeowners association. You didn’t build the $40,000 community septic system, guess who will pay to fix it if it fails?
Common land amenities that appear in the developers’ sales brochures may also never materialize: I’ve seen a promised playground take several years to appear – as a vacant lawn. And a promised hiking trail in another nearby development was never built due to marshland restrictions. Similarly a promised swimming pond can turn out to be a mud hole or a poorly built private road may need extensive repairs after a couple of seasons.
If you used to living in urban or suburban area, and are planing to buy land in a rural area, you may be surprised to find that your quiet rural retreat isn’t so quit or pristine. Find out what uses are permitted on the “conservation land” that borders your lot? Is there a stone quarry just beyond the tree line with earth-shaking explosions on weekdays (but quiet on the Sunday you walk the land), a shooting range or snowmobile trail too close for comfort, a new highway coming through your pristine backyard in a few years, a hog farm planned next door? Ask around and do your homework. If the land seems like a bargain, maybe there’s a good reason, so take a good, long look before you leap.
Since most semi-rural land on the outskirts of urban areas are undergoing rapid changes in many areas, it is worthwhile talking to the town’s planning department to learn about what uses are permitted in your area and what the town envisions for that area in its master plan.
You rarely get to know who your new neighbors will be when you buy a piece of land. But it doesn’t hurt to make a reasonable effort to find out. If you are serious about a piece of land, don’t be shy. Knock on a couple of doors, introduce yourself, and ask what the neighborhood is like. This also a great time to ask about water well performance, and any issues that are of particular importance to you, for example, traffic patterns, hunters nearby, new developments planned in the area that might block you view.
If you see a bunch of white pipes sticking out of the soil in neighboring field, these are most likely wells for monitoring the seasonal high water table to establish whether conventional septic systems can go in. This pretty field of hay may soon become a field of houses and condos.
Other problems may lurk out of view — a house a friend of mine bought in a rural area turned out to have a firing range next door, unknown to him when purchasing. Land I have looked at has had an eroding sand pit just beyond the property line, with the erosion line heading my way. Another lot had a large stone quarry a quarter mile away through the woods that generated a lot of noise with monster-sized trucks and occasional blasting – but none of this was happening when I first viewed the land on a weekend.
Are the “abandoned” railroad tracks that run by your land truly abandoned, or might they be brought back into service. Has farm nearby just been granted a variance to start a pig farm upwind from you. Or will the silage smells in spring be too much for your city nose to tolerate.
Town planners will know in any new roads, large residential developments, or commercial or industrial parks are planned in your vicinity. Spend a few minutes talking to them if you are at all concerned.