by Caroline Kirby
Buying your first piece of land is exciting and confusing, scary, and complicated—but it doesn’t have to be! Plenty of people assume that if they have experience purchasing real estate that they’ll be able to glide through land purchasing, but these two areas are very different. If you’re embarking on buying your first piece of land, keep the following tips in mind to ensure things go smoothly.
As you get started, there are a few different categories you should take into consideration. First, ask yourself the following questions to help you get on the right track.
- What do you want the land for? Make a list of the different ways you think you’ll use your land. Is it to build a home? Hunt, fish, timberland investment, etc.? Do some research on the required acreage for your intended use. Getting clear on your intended uses will make the whole process much easier and allow you to refine your searches.
- What’s your budget? There’s no use in spending time looking at anything that is way above your budget. Do the math and find out what different financing options are available. Your budget will also help you narrow down property location and size, making your search even easier!
- Do you have any deal breakers? You want to outline a list of any potential deal breakers so that you don’t waste any time getting into purchasing conversations on a property you definitely know you don’t want. Some common deal breakers may be: environmental hazards within the property, existing claims, judgments, or legal action on the property, is there legal deeded access to the property, etc.
- What kind of insurance will you need? Often vacant land or other properties require some liability insurance. Get educated on the different types of land insurance available and get quotes. Another standard insurance is title insurance.
With these four questions you should be able to have a set of boxes to check off and characteristics you’ll want to avoid when looking for land. Buying land is just like any other property purchase in the sense that you have to make the best decision for yourself with the available information. Be sure to do your due diligence and make an offer on the land that meets your needs!
With the information you get from the questions above, you should go ahead and start looking into how you’ll pay for the land:
- Ask around and see what institutions are available in your area. Banks don’t typically lend on land purchases, so see what your options are.
- Start putting money aside for your down payment.
- Save money and work on improving your credit score as early as possible.
These last tips can help ensure you can purchase the land you have your eye on and make the whole process as painless as possible.