Buying land to build a house.
While any real estate agent can help you purchase residential property including a house or a vacant parcel of land, experienced, skilled, trained and seasons real estate agents that are familiar with land can help you with the nuances and differences between a single-family house, building and land. There are differences to the purchase, finance and contract and unless you use some of that is familiar with the process, you could be making a lot of mistakes and costing yourself a lot of money. It really pays to go with a real estate professional that understands how to purchase land.
Check the zoning and condition of the property. Few things will be more disappointing than buying the perfect plot of land for your dream home, only to find out that it’s not OK to live on, either due to zoning issues or soil contaminants that make living there a hazard. Check the zoning, grade and soil quality, as well as other details specific to the area that may keep a house from being constructed on the land. Even if there’s an existing home on the property, it’s important to check, as zoning or soil quality could have changed since that structure was built. A real estate agent familiar with buying land can help you with the due diligence process. Check with City Hall, building guidelines and any neighborhood covenants about the property. You want to know about restrictions, setbacks, water and electricity and any easements or road access.
See if utilities are hooked up. Undeveloped, vacant land or a dated house may need additional work to enable it to reach utilities, including electric, gas and plumbing. If utilities are not available or old plumbing needs updating, factor the additional work into your budget. This can be pricey: A sewer hookup, for example, may even require construction on the street in front of the property, which requires additional permits and more money.
Demolishing an existing structure. If there’s a house or other structure on the property that must be demolished, you have a couple of options. A mechanical demolition with excavators and heavy machinery will take a house down the fastest but cost more, while a smaller-scale demolition by hand will be cheaper but require more time. You may need to hire a separate contractor who specializes in demolition as well. A contractor can manage details to ensure utilities are shut off for demolition, you've secured the necessary permits and you've notified the local fire department.
How much does it cost to buy land to build a house? The cost of land varies widely based on the size of the plot, where you live and if there’s already a house there. When a house exists on the property, keep in mind that you typically won’t be able to pay the land value only. The existing structure, regardless of its condition, is considered an improvement on the land and is factored into the overall value. That said, a seller desperate to close on a deal will likely consider lower offers knowing the property is a teardown.