What To Ask When Buying Land? What do I Need to Know When Buying Land? When Buying Land What Questions Should I Ask?
Buying land is easier than other real estate purchases. However, there are some things you need to know and look for when getting ready to buy land. Be sure to ask these 15 questions before moving forward with any land transaction, they will cover what you need to know about buying land and things to look for before you buy!
1. What is the Chain of Title?
In other words, do you know who the buyer is? It may seem obvious, but scams happen where people will advertise and try to sell land they don’t actually own. It’s rare, but something that land buyers need to be aware of.
A more common instance may be that the previous landowner is now deceased, and didn’t clearly leave the property to a new owner in the will. This can make the chain of title messy and clouded.
To determine if the property has a clear and concise title chain, you should always start by asking the seller to send you a copy of the deed. If they don’t have the deed on hand, you can check on the county’s website for the deed history.
You will need the APN (Assessor’s Parcel Number) to search for this information. You can use a title company instead of coordinating with the county, but these can be quite expensive. Expect a ballpark anywhere from $500 to several thousand dollars.
2. What is Property Back Taxes?
Once you’ve concluded who owns the parcel, your next step is to confirm the amount of back taxes, liens, or debts owed on the property (if any). This is important to check because it makes sure you don’t get stuck with a property that you may love, but has hundreds or maybe thousands of dollars owed on it!
As the new owner, you would be responsible for paying these off. Crippling!
3. Is the Property in an HOA or POA?
When you buy land, it’s important to know if the property you are going to purchase is part of an HOA/POA for two primary reasons:
- They usually have an annual fee
- They have their own restrictions and property use rules to be aware of.
The HOA/POA fee, and any outstanding balances due, will not be in the County Treasurer’s system. You will have to contact the HOA/POA directly for dues on the property.
When we first began investing in land, we almost made the mistake of purchasing a property that had over $3,000 owed in HOA dues! YIKES! Thankfully, we caught it before the documents were signed. That would’ve been a big mistake.
If the owner doesn’t know whether or not the property is in an HOA/POA, I would recommend taking that valuable APN and contacting the county. They should be able to give you an idea of HOAs and POAs in the area and might be able to help you figure it out.
4. What is Property Zoning?
Is the lot buildable? What other construction is planned or possible on the surrounding land? Is this property agricultural, residential or commercial?
These are factors that must be considered when trying to figure out what you want to do with your new parcel. Camping and RV-ing is a popular activity for new property owners. You’d be surprised how many parcels out there don’t allow either of these activities. While there are heaps of parcels that allow you to do virtually whatever you wish.
Your best bet here is to contact the county’s Planning and Zoning Department directly. The seller should be able to describe the zoning of the lot, but it’s always best to get it straight from the source.
5. What Can You Use the Land For?
There are so many different things you can do with your new property! The only restrictions you face are zoning and HOA/POA rules. The most common classifications of vacant land are recreational, residential, and undeveloped. It’s pretty important to follow the zoning requirements and HOA/POA rules. For example, it would not be advised to try hunting on land zoned for ‘residential’ use.
Here are some examples of common classifications:
Recreational: Anything from dirt bikes, ATVs and go-karts to RVs, camping, and glamping. You can play, hunt, fish, or climb. Stargaze. Create a paintball park. Practice on a private driving range. Recreation for your creation!
Residential: Build it how you want, when you want. Customize your next home or vacation getaway. Bring in a manufactured design. Plant a tiny home with a garden to boot. Home is wherever you want it to be.
Undeveloped: An escape from city life, a place for solitude and quiet. A secret hideaway. A place to enjoy the best of times, or perhaps be prepared and ready for the worst.
6. Does the Property Have Utilities?
It’s not common for vacant and rural properties to have utilities. If the property is part of a developed subdivision, chances are it will have access to at least power and water, but there will be a connection fee for activating them.
Whether or not the property requires either sewer or septic, and either city water or a well depends very on the property location and costs of bringing utilities to it. The county will be able to tell you what your options are.
If you’re looking for more of an off-grid property or private getaway, you can always tap into natural resources! Installing a couple of solar panels and collecting rainwater are great ways to keep your costs down and ensure you keep your privacy.
Are You Looking for More Info?
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Get the FREE Guide and then give us a call at (313) 349-0434 and we’ll discuss how you can easily buy land with little money using our automatic approval owner financing.
7. What Property Taxes do You Pay?
Land is less expensive to hold over a long-term than most other real estate assets, like townhomes or apartment buildings. This is because … drumroll, please … there’s nothing on it! No improvements, structures, or additions make it very inexpensive to maintain.
You still have to check the amount of annual property taxes before you buy it. It’s important to note that even if you do nothing to the property, don’t use it, visit it, nothing at all, you as the owner will still be responsible for property taxes. I’ve seen property taxes as little as $3 a year, and as high as hundreds a year. You want to make sure you keep the taxes paid because if not, the county could sell your property at a tax auction – and you will lose ownership!
If you plan on buying a property as part of a long-term investment strategy, don’t forget to ask about the property taxes. If the seller doesn’t know how much the annual taxes are, you can use the APN and search the county database online, or call the County Treasurer.
8. Does the Land Have Common Facilities?
It’s rare, but sometimes there are common facilities (water, septic, road, etc.), or common property that the homeowners or developer will need to manage.
This is usually only the case in developed areas, perhaps a subdivision or a gated community. Even though it’s uncommon, it’s still an important question that made our list because if there are commonalities, you need to know how they’ll be handled and how much extra it could cost you.
9. How to Access the Property?
Rural properties are great, and a lot of people really value the privacy they offer. But sometimes, these properties don’t have legal road access. That means you would technically have to trespass on a neighbor’s lot or on a private access route to get to your land.
Any legal access should be described in the dee. Legal access means the path to the property is public (e.g. a country grade road; gravel, or paved).
While in the navigation mindset – be sure to ask the seller for coordinates and an address, if there is one (it’s normal for vacant land to not have an address). Do this especially if you’re not going to physically go check out the property. At least that way you can double-check on a GPS or Google Earth and verify with the county’s GIS maps that the property you’re purchasing is what you’re expecting.
We do a walkthrough of how to find access to your property in a separate article, you can find it here.
10. Is the Property Where Wetlands Are Located?
Wetlands don’t generally appeal to land buyers and investors. They’re either seasonally or permanently saturated with water and will contain marshes and swamps.
Not ideal for building, and a variety of other activities that require a solid ground. In most wetlands, you can’t alter the environment at all – they’re protected by government bodies (and may even be public use).
You can potentially camp, boat, canoe, kayak, fish, and hunt on the lot if it meets the zoning and property use restrictions. Other non-intrusive activities include photography and bird and nature watching. Here’s where you can learn how to check if your property is in wetlands.
11. What is the Property Size?
When you start browsing for land, chances are you have a dream in mind. Maybe you’re looking for a new home lot, a private campground, a bushcraft site, there are endless possibilities.
This is why it’s crucial to understand the size and shape of the parcel. It will let you know how much “stuff” you can build, or how much space you have to roam.
When you ask for these details, it doesn’t hurt to include the property topography, slope, and elevation. With this knowledge, you’ll have a complete scope and the lay of the land, and understand if it meets your requirements or not.
12. Is the Land Near a Conservation Easement?
Wait, what are conservation easements? A conservation easement is a restriction placed on a piece of property to protect its resources. It’s is a legally binding agreement that can limit the landowner from planting, clearing, or hunting on certain areas of land.
A conservation easement is binding, whether the property is sold or passed on. Since the land is permanently restricted, it’s often worth less than the going market value.
Conservation easements will allow owners to retain many private property rights and to live on and use the land, and while the easements are good for the environment, it can be bad for you. Before you seal the deal, ask the seller:
- Are there any easements on the property (adjoining owners, conservation, utility)?
- Are there any known environmental concerns or latent defects with the property?
13. Who Owns Mineral Rights to My Property?
This isn’t common. Mineral, Timber, and Water Rights to the land are often owned separate from the land itself. You could be sitting on a gold mine and not legally be able to access it! You simply won’t own the rights to it. Here’s some information for you on how Mineral Rights work.
If you want to explore the parcel depths, ask the seller who owns the Mineral Rights, and if they’re sold with the property.
It’s a similar story for timber and water. You may have some prime lumber on your lot, but if you don’t own the rights to it, you cannot try to sell it or get any kind of profit. Ask before you buy so all everyone understands what’s included with the land sale.
14. Are There Any Water Features?
This is more of a nice to have. It’s not going to totally ruin things like other questions on this list could. A water feature can refer to a river, creek, lake, spring, pond, stream – a body of water that already exists on the property. A water feature can potentially increase the value of the property, or if it’s a wetland or marsh, potentially decrease the value.
Whether the lot has a water feature or not isn’t a deal-breaker. Just remember to ask this before you buy it. Who knows! You might luck out with your own private lazy river.
15. Who are Your Neighbors?
Who are the neighbors surrounding your lot? If you had to sell this property again in a year, is it desirable to other potential buyers?
These are important final questions to ask, because whether you like it or not, what your neighbors are doing affects the value of your property. This is especially true in subdivisions and semi-urban areas. It won’t be a problem so much if you’re out in the desert in the middle of a 40-acre parcel.
Bottom Line: What to Ask When Buying Land?
These questions will give you a great in-depth look at the property you’re about to buy. They’ve definitely saved me from making big mistakes and saved me lots of money on my land investing journey!
Be sure to ask these questions before you buy to keep your transaction easy – and make sure you can safely purchase land without regret!