Cost Considerations when Buying Land to Build

Buying undeveloped land can entail a whole host of considerations and expenses well before you decide what kitchen counters you'll get. Some of the costs are minimal up front, but increase over time, while others are just plain more expensive.

Here are some additional considerations if you're pondering a residential land purchase:

1) PHONE, INTERNET, CABLE AVAILABILITY: Believe it or not, not every property has good cell reception, high-speed internet or cable TV options. Some land is just too rural, so be sure to check this out thoroughly. Try your cell phone at different times of the day, see what providers show online is expected coverage, call local providers and ask about restrictions, future access and current offerings. Especially if you plan to work from home.

2) DRIVEWAYS: Access to your potential new home may be no big deal if you're buying a property in town. But if you're considering a more rural purchase, driveway costs add up fast. Clearing the land, grading it and then re-grading after construction is expensive. Once a driveway is finished, you'll have maintenance and upkeep, but if you're driveway is long, those costs increase with length (not to mention snow removal consideration).

3) UTILITY CONNECTIONS: Electricity, water, sewer, cabling and other costs add up fast. Some land already has these connections on-site, so the costs associated with connections are minimal. But if you are buying property that doesn't have electricity, for example, you will have to pay to have that service brought to your property. Each jurisdiction and service provider has a different scheme about how the charges are made. Ask careful questions before you purchase. And don't assume the neighbors will necessarily be obliging in letting lines run through an adjacent property, either. Property values lessen when easements are provided since there are restrictions in the future for that owner about what and where they can do with their land to accommodate your request.

4) MATERIAL AVAILABILITY: If you purchase land in, say, the southwest, and want to use soapstone for your counters, you'll pay more than you would in, say, central Virginia, where there is a lot of local soapstone and the shipping fees are less. Proximity to local, usual, abundant materials has a huge impact on building costs. Figure out which things are local and readily available to keep your budget in check. If you're building in the Caribbean, for example, everything has to be shipped in, skyrocketing costs for even the most modest home.

5) PERMITTING and INSPECTIONS: These vary widely, so if you are narrowing your choices down between multiple jurisdictions, check into these. While they are typically one-time, upfront costs, there is also the consideration of how quickly (or not) the municipality responds to requests, how reasonable they are about changes, what the consequences are for mistakes. And these can add up over the time of a project, especially if you run into delays for weeks or months and have to store materials, winterize, etc.

It goes without saying that material choices, local labor costs, unplanned upgrades and delays all cost money. But when you're taking the leap to buy land keep these lesser-considered costs in mind, too!

More from this contributor:
Understanding Home Heating Systems
HOA's, Deeds, Rights of Way, CCR's, Easements and Other Restrictions on Your Property
Buying a Home? How TV, Cell Phone and Internet Service Can Make or Break Your Purchase