Use this general checklist when evaluating a piece of land. A quick run through the checklist may remind you of questions to ask the seller, real estate agent, lawyer, title company, town officials, or outside experts, if necessary. It will also help you remember budget items that are often left out. See also questions to ask and our budgeting guide for more details.
- Is the lot buildable?
- Has the site passed a perc test that is still valid (some expire in 2-3 years)? Is it suitable for a conventional septic system, or for an expensive alternative system?
- Are the boundaries clearly and accurately marked?
- Can the seller provide clear title for the property?
- Is it zoned for the type and size of house you are planning?
- Where can you build on the site? Does the proposed house plan violate any rules: setbacks or other zoning restrictions, septic system rules, or other regulations?
- Is there legal access by road or right-of-way? Who maintains the road?
- Is there adequate road frontage to build?
- Are there any liens, rights-of-way, easements, covenants, or other deed restrictions or encroachments on the property?
- Are there building restrictions due to wetlands, water frontage, steep slopes, historical or cultural sites, or other local, state, or federal regulations?
- Was the land formerly used to store old vehicles, farm chemical, industrial chemicals, or other toxins that you will need to clean up?
- Does all or part of the lot lie in a floodplain?
- Is there sufficient potable water?
- Will you own the water and mineral rights?
- Are there any endangered or protected species on the property?
- Is there adequate access for construction equipment?
- Are there problem soils, including expansive clay, un-compacted fill, or ledge that may require blasting.
- Is the area prone to high radon readings?
- Is there a high seasonal water table, seasonal streams, or low-lying areas subject to flooding?
- Are there steep slopes or unstable land that requires special engineered foundations.
- Will large areas of cut and fill be required to level the land?
- Are there areas subject to erosion that will need stabilization?
- Is the land flat or sloping?
- Wooded or open?
- Shaded or sunny?
- Solar exposure
- Wind exposure/buffering
MAIN COST FACTORS
- Cost of land acquisition
- Legal fees: title search, title insurance, and other closing costs. Also may include variance applications, challenges from abutters, right of way issues, etc
- Water and sewer connection fees (for municipal systems) – may cost hundreds to several thousand dollars
- Connection fees for other utilities: phone, electric, cable, gas,
- Septic system (for rural sites): perc testing, system design, and installation
- Well installation: including drilling, pump, plumbing to house, pressure tank, and water treatment, if needed
- Land clearing
- Excavation, cut and fill, and final grading
- Road/driveway construction
- Permits and fees: well, septic, building, driveway, variances, other
- Impact fees: often cost thousands of dollars. varies by state and municipality. Also called development fees, mitigation fees, service availability charges, facility fees, and other creative names.
ALSO THINK ABOUT
- Are there nearby nuisances such as unwanted noises, smells, or hazards: farmers’ silage, hunters, snowmobile trails, a firing range, or blasting at quarry just beyond the trees?
- Find out who your neighbors are and whether their lifestyle (collecting dead pickup trucks, e.g.) are compatible with yours
- Have any neighbors been granted a special exception or zoning variance and what for use –a pig farm perhaps?
- What school district?
- Distance to work, shopping, restaurants, etc.?
- Property taxes
- Fire protection – what is available in rural areas
- Future development nearby: houses, commercial development, roads, highways
- Insurance rates – may be higher near water, in flood plain, in high-wind zones, or far away from a water source or pressurized hydrant for fire protection.
Questions to Ask When Buying Land and Budgeting Guide for land development.
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John Wood says
Should I Test Well Before Buying Land?
I am considering buying a property that was involved in a wild fire. The lot was previously developed with a residential home, roads, well and septic system. My real estate agent informed me that it is common practice to have the well tested after the purchase offer has been accepted. Not knowing what development costs are will make it difficult to tender an appropriate offer. Is it standard procedure to purchase, then test and inspect?
You don’t want to purchase the land and then test it. That would be taking an undo risk.
However, it’s always a good idea to make your offer contingent on satisfactory tests and inspections. That way if your offer is accepted, you can spend a relatively small amount of money to determine whether to proceed with the purchase.
With a well, you can add general language such as the “well is to produce a flow rate and water quality satisfactory to the buyer” or you can specify a minimum acceptable flow rate. Read more on well testing.
Similarly, you may want to test the septic system if it is still usable or conduct a perc test to make sure that the site is suitable for a new septic system under current law.
Read more about Adding Contingencies To Your Offer Water Well Basics
What Tests Are Needed and Who Pays?
I am interested in a piece of land for building a home. This lot is sloped and there is drainage at the bottom of the steep section for flood water drainage. My concern is what kind of testing we should do before buying the land to determine if we can building the size and type of home we have in mind. My builder told me to do septic test and geo survey test. Are these enough to inspect the deep layer soil type. Are there any other tests that should be performed? If we want these plus additional testing, who will be paying, because it sounds expensive. Any information will be helpful.
A building site with a shallow slope, up to about 10%, a 1 foot drop over 10 ft, is easy to build on. Moderate slopes of 15% to 20% will need a little extra foundation work to step the footings down the slope. These sites are ideal for walk-out basements and generally have the back yard lower than the front (or the opposite on an up-sloping lot).
Another advantage of moderate slopes is that it is usually easy to drain the footing drains to “daylight” to safely dispose of water that collects in the footing drains around the foundation.
As for testing, the perc test is generally the most important, because you cannot build a home without a successful perc test. You should make this a contingency of your offer. On smaller lots, the perc test and proposed drain field area will also help you determine where the house can be located on the site. It typically includes a deep hole test that will located the high water table and deep soil characteristics, at least in that part of the site.
Other site testing is discretionary. I’m not sure exactly what is included in the proposed “geo survey” test, but key issues to explore are soil type, water table, and drainage characteristics. Some soils are difficult (that means expensive) to build on. The soils may be too weak to easily support the load of a building, may be filled with unsuitable materials, or may have ledge that requires blasting. Other less common problems include expansive clay soil. Most sites have none of these problems, but it’s best to know ahead of time what to expect and budget for.
The seasonal high water table is usually determined as part of the perc test. A high water table increases the cost of your septic system and makes it impractical to build a full basement.
Site drainage is important on sites that have wet spots of lie in path of natural (or man-made) drainage courses. For example water from surrounding properties may naturally drain though your land or collect there. Again, it’s good to know this ahead of time and make sure you can manage the problem in an affordable manner.
This type of testing and evaluation is generally done by a geotechnical or civil engineer.
As f0r who pays for testing, that’s up for negotiation. No surprisingly, sellers don’t want to foot the bill unless they feel that have to in order to sell the lot. Many sellers do spend the money for perc testing, but rarely pay for additional testing. However, it never hurts to ask for the seller to kick in at least part of the money if you have a specific test in mind that you feel is necessary for developing a site.
Best of luck!
Eric Moore says
Industrial Trash on Land For Sale
My family is planning to sell 10 acres of undeveloped property. The goal is to sell to a developer who will subdivide the 10 acres into five 2-acre sites. One area of this property has a fair amount of metal type trash i.e. steam pipes, steel plates, very old empty rusted 55 gal drums, etc. Does this trash need to be cleaned up by us before the sale or can the trash be dealt with by the developer? Most of the trash can be sold as scrap but a couple of large pieces will need some big equipment to move it. Thanks!
Whether or not to clean up the land is really up to you. If you clean up the site, you will probably get a better price for the land. Otherwise, the buyer will factor the cleanup costs into their offer. Assuming the cleanup is straightforward, it would make sense to do it before putting the land on the market – just like you might put a fresh coat of paint on your house before selling.
When there is a lot of debris like this, there may be a concern about hazardous materials on the site. For example, the steel drums may have held motor oil or some other industrial fluid before they rusted out.
If the soil is found to be contaminated by anything considered a hazardous material, it can trigger local and state (and federal) regulations regarding excavation and cleanup, which can get very expensive. Laws also govern who is responsible for the cost of the cleanup – typically the party that caused the hazard if they can be located. If not, the current or prior owner may be held liable.
I am sure that any developer interested in the land will examine the site carefully and may conduct soil tests if there is any evidence of contamination. Hopefully, this will not be an problem, but you may want to get ahead of the issue by cleaning up the site before offering the land for sale.
Paul Tessier says
What Are Restrictions on Lot Next Door?
I am a realtor and my client wants to buy an empty lot next to his house. Where would he go to learn about any restrictions on the lost, and who might provide a loan?
To learn about restrictions on development, the best place to start is the city or town’s dept. of building/zoning. You can usually find a lot of the basic information on the town’s website, such as the zoning district, setbacks, lot coverage, and other standard zoning regulations.
Other land use regulations take a little more digging. Things such as boundaries, easements, and subdivision restrictions may be recorded at the zoning department or the county registry of deeds. These usually turn up during a survey or title search.
It’s a good idea to add a reasonable study period as a contingency of any land offer. It usually takes more work and more time to perform due diligence on vacant land than an existing home. I am often asked who can provide this service – similar to a home inspector for an existing home. Unfortunately, I don’t know of any profession that offers this specific service. You really need to identify what the critical questions are and then consult the relevant professional: surveyor, engineer, architect, contractor, or lawyer.
One thing to consider: If your client combines this lot with their own into a single lot, then the zoning rules for their current lot will change. For example, they may be allowed to add more bedrooms, increase the footprint, and so on. The town’s zoning department can be a useful resource for this information as well. Scheduling a face-to-face meeting the a zoning officer, with a list of questions and any proposed plans, can yield a lot of useful information.
See also Who Can Help Evaluate Lot?
A loan for land is really no different than any other mortgage, but banks and mortgage companies usually require a higher down payment.
Who Can Answer Land Buyer’s Questions?
Who is the right person to answer questions from the land-buying checklist? Thank you.
While a good home inspector can do a pretty thorough job of inspecting a house for construction defects (although they frequently miss things), they cannot tell you about problems with title, liens, HOA regulations, and so on. Similar, with land, you need to speak to number of different people for help with evaluating the site.
And while home inspection is now a common profession, land inspection is not. I am not aware of anyone who offers this service to individuals. Large developers can hire land development consultants, who will evaluate a piece of land using engineers, surveyors, and other professionals as needed.
The closest you can probably get for one-stop-shopping would be a surveyor, who could give you a detailed legal description of the land, its boundaries, its general zoning status, any problems with protected wetlands or flood plains, any improvements on the property such as utilities, and any encroachments such as easements, as long as these are readily accessible in public records. If the land has a recent survey on record, you can obtain this information from town or county officials, but may still want a surveyor to help you understand the information, which can get pretty technical.
More detailed zoning information about what size house you can build with how many bedrooms you would need to confirm with the town’s zoning officer. Some older lots have grandfathered zoning status that might be less restrictive than the current regulations.
If you suspect that their might be water, drainage, or septic system issues with the land, you may want to have an engineer (civil or geotechnical) or septic system designer take a quick look.
With unimproved land (also called “vacant land”) there are no real short cuts here, but a lot of work to figure out what you are buying. The phrase “caveat emptor” – let the buyer beware – is applicable here. With improved lots from a developer, with utilities and permits in place, there is much less risk for the buyer, but you will pay a premium for the improvements.
Before hiring any professional to assist with your land research, provide them with a list of questions and find out ahead of time which they can answer and what the cost will be. If you are lucky, you can find people to give you a “best-guess” professional opinion without doing thorough (and expensive) research at this point in your search.
You can read more on this at Questions to Ask, which is broken down by the various types of professionals, businesses, and government agencies where you can go for information.
steve patel says
Can I Build On Lot After Tear-Down?
I am thinking about bidding for a house lot in Buena Park, CA. It is approx. 12,000 sq.ft. It has an old house on it, which is a complete tear-down. The land slopes from the street to the back of the lot approx. 10 ft. Can one build a new house on this lot?
This sounds like a pretty gentle slope, so that should not be a problem. California contractors routinely build on much greater slopes, although foundation and site work costs can be significant.
On a small lot like this, I would be concerned about setback requirements and rules limiting house size, number of bedrooms, and lot coverage (total area of all buildings and paving). These are all zoning issues, subject to the zoning regulations in the city or town where you are building.
Older lots are often “grandfathered” in and not subject to all current zoning regulations. Your best bet is to schedule a meeting with the building and zoning department in the town, explain to them what you wish to build, and ask whether this is feasible. Bring a sketch showing the approximate size and location on the lot of the house, any other structures, and the driveway and paved areas.
While you’re there, ask for a list of the permits that will be required to tear down and build and all fees that you might incur (including any impact fees) – always a big issue in a heavily regulated area like California.
Best of luck with your project!
Read more on the Budgeting for Site Development
Jonathan Pound says
Check HOA Regulations and Dues
Another thing to consider when buying land is to check if there is a governing HOA. There can be a lot of regulations about how you build and develop your land. You will also want to check on what the HOA dues are and how the HOA is structured. Also, get your land surveyed so you know what the land is worth.
DAVID OTERO says
Bought Unbuildable Lots on eBay
I am a beginning investor and I was sold some mountain land, 2,600 sq. ft. on one lot, but it is too small to build on according to the San Bernardino County Building and Safety Dept. They say you need 4 lots grouped together to build and minimum size requirements. Well this one is too small and it is right on a drainage ditch. They sold me a drainage ditch not buildable to say the least. They did not disclose this and I bought it cash at an auction on Ebay.
Next I bought another lot 2,800 sq. ft. lot but this one had taxes owed of $2,830 on it and will go to tax sale next month. This one is also not buildable. I lost twice in the last few weeks. I bought these lots on an eBay auction. Wow.
I have learned the hard way, but I wish I could take these people to court to expose them for the crooks that they are.
Hi, I’m going to purchase property on ebay tomorrow. I’m just wondering who you purchased land from
Now that was dumb — some people never understand that if it is too cheap..there is a good reason.
J G says
Who Determines If Zoning Is Right My Project?
Who is responsible to determine if the property I am buying is zoned right for my intended use?
Broadly speaking, the rule of “caveat emptor” – let the buyer beware – is still the governing principle of land transactions. It is your responsibility as a buyer to determine whether the property’s zoning district will permit the use you have in mind. You can certainly ask the seller or seller’s agent about the zoning, but I would not rely entirely on their answers.
Zoning information is pretty easy to come by these days. For most jurisdictions, you can find zoning maps and your parcel’s zoning status online. You can also find the zoning regulations online, which list which uses are permitted, prohibited, or allowed under special circumstances (for example, with a special permit required) in each zoning district.
There are always gray areas, however. For example, many residential zoning districts allow a home-based business or occupation, but each town may define this a little differently. If you have truck deliveries and customers coming and going, you might run afoul of local zoning laws. Similarly, some residential areas allow limited urban agriculture with large gardens and maybe a few chickens, but prohibit larger commercial farming.
If your intended use falls in one of these gray areas, or is one that requires special permission of the town, it would be wise to check with them ahead of time and to make your offer contingent on getting approval for your use. Don’t hesitate to sit down with a town zoning official to discuss your intended use. Ask them to put in writing that your intended use is permitted – just in case there is a change of personnel or policy in the planning office.
Best of luck with your purchase!
How to Locate Best Site on Lot
We are considering buying a piece of land in MA, subdivided by a property owner, who has written proposed building restrictions, one of which is that she must approve the site where a house (or any other structures) will be placed. We don’t want to build for at least five years. Obviously, we want to make sure that we can build in a desirable location on the property. Who do we consult to figure out the best site for a house on the property (about 3 acres)? After doing so, we would hope to make sure we have approval from the “grantor” before agreeing to buy the property. Should we call a landscape architect? A real estate attorney?
On many building lots, by the time you account for setback requirements, location of the septic system (on a rural lot), site drainage, road access, etc., the optimal building site is pretty evident. On a three-acre lot, however, you may have the luxury of choosing from several possible sites.
Issues to consider are views, exposure to sun, privacy (including distance from present or future neighbors), drainage, soil type (e.g., you don’t want to have to blast through ledge for your foundation), and cost issues. In general, the farther you are from the main access road, the greater the cost for bringing in water, gas, electricity, etc.
The owner who subdivided may already have a house site in mind, so I would start by asking her. Find out what her main concerns are in siting the house. Perhaps she does not want you blocking her (or other’s) views or has concerns about privacy. In some cases, the site plan and septic plan are already established and would be difficult for you to change. If there are many options, however, and the optimal site is not clear to you, then an architect or landscape architect would be a good resource. Hire them on a limited, hourly basis, to consult on siting the house — should be no more than a few hours of work.
You absolutely should get the grantor to sign off on your proposed location before sealing the deal.
Several years ago, I made an offer on lot in a rural subdivision, where the original developer had retained the right to personally approve all house designs. I was buying the lot from a private seller, not the original developer who subdivided the lot many years earlier. My offer was accepted with a contingency for design approval which I had added the offer. I quickly sketched out a house design that fit in nicely with the local architecture and neighboring houses. The developer rejected the design because my design was, according to him, too small and would “hurt property values,” an absurd notion. The design complied with all the subdivision design guidelines, including minimum house size!
The moral of this story is to be wary of design review by an individual, or even a committee, who has the power to say no based on subjective criteria — or just their personal taste. Got approval beforehand.
As for consulting a lawyer, it’s always a good idea with a land purchase – especially if you have unanswered questions about zoning, deed restrictions, or other legal issues. Hiring them to review your offer may be the best $200 you ever spent. Local zoning and building officials can also be a great source of information and are usually very happy to speak with you about your prospective building plans.
See also Questions to Ask When Buying Land
kevin halligan says
Due diligence is huge. If you were to do all the work that is necessary to select a good area on the site that meets your needs and is legal / feasible it would then be troublesome to find the neighbor/former owner having a veto power on that location. It would be better to have them identify what they don’t want or where they don’t want it. Like maybe they don’t want to see your home OR maybe they don’t want their views blocked OR they’d hate to see a certain grove of trees removed for a home. They may be reasonable or they may want to impose their thoughts on every aspect of your home and life. Crappy neighbors will make you want to move. Crappy neighbors that control significant decisions in your life can make you homicidal.
A deed restriction that has unlimited veto power is a lawsuit waiting to happen if they are less than reasonable.
Barbara West says
Who Pays for Survey?
Who should pay for the survey?
There’s no simple answer to your question as surveys may be done at different times for different purposes – e.g., to stake out a lot, to establish zoning compliance, setbacks, clearances to lot lines for leach fields or other building components, and so on. If you already own the lot, you will have to pay for a survey if it is required by the town or if you want it for your own peace of mind. This is often a concern on small lots where your building or leach field is close to the lot line.
If this is a lot you are considering buying, it is a matter of negotiation. If the lot has clearly marked bounds and the survey is recorded by the town, you can be reasonably confident that you know exactly what you are buying. If the boundaries are unclear, you can make a survey a condition of your offer. Read more on surveys.