What Are the Ten Most Expensive Mistakes when Buying Raw Land?

Living in the country can be a wonderful life, yet buying raw land in the rural countryside has different considerations than purchasing a home in the city. Knowing some of the mistakes to avoid can save you a great deal of money and problems in the future. Here are the top ten mistakes that can cost thousands of dollars for unsuspecting and naive land buyers.

--Mistake 1- I can do this myself and it will save me in real estate fees.
The price of the land is market price which includes the fee to an agent. Usually the seller will be the one who comes out ahead as they retain more profit rather than reducing the price. You also have little protection when you go it alone.

Work with a real estate agent who is familiar with country property in the county and state you are buying land. Even if the land is cheap land, you still want a knowledgeable agent helping you. Going it alone will leave you vulnerable to a myriad of unknown issues only known by a rural land specialist.

--Mistake 2- I want to build two houses on my new property. It looks big enough for two houses.
Be aware of the zoning laws. For instance, you may be looking at a nice little 5 acre parcel to build a house on for you, and a small cottage in the back for grandma. Make sure the zoning allows for two homes on the property. If you plan to have farm animals, make sure it is zoned for large animals. Zoning can also affect outbuildings, crops, roads, fences, towers..etc.

--Mistake 3- the utility companies are responsible for putting in utility access for free.
That is not true. Check out the utility sources. Where is the main electrical hook up? Is it at the street, or is it four miles down the road at the neighbors farm? You will have to pay to bring the electricity up to your house from wherever it currently is. The same is true for phone lines. You will also need permits for your utilities.

--Mistake 4- If the land is for sale it should have access to water right?
Not necessarily. What is your water source? Is there city water available or will you need to dig a well? Digging a well can cost thousands of dollars without guarantees of success! Tying into to city water will also require an expense and a permit. Make sure you are able to get a permit before you buy. Some areas only allow so many water permits a year to be issued due to shortages.

--Mistake 5- The people who lived here before said the water in the well was great...better than city water!
If there is a well existing on the property you will want to test it. Test the quality of the water (for bad things that may lurk in the water that you can't see or taste). You will also want to test the amount of water that can be pumped in an hour. You don't want to run out of water in the dry months.

--Mistake 6- I don't need to have the septic inspected.
If you are in the country, you will likely be on a septic system. If one is in existence, how old is it? Have the tank inspected and pumped. How big is your tank? Is it big enough for your size of family or will it back up into your living room on Christmas morning because your sister's family is visiting and extra stuff is going into the tank.

--Mistake 7- I own all the land I am buying and no one else can use it.
This is one of the scariest things about buying rural land- especially if the land is cheap. There may be very generous easements on your land. You can find out who has a recorded easement by looking at the preliminary title report.

An easement is a legal right of use. This means someone-- other than you-- has a right to use a portion of the property. It can be for a variety of purposes. The most common is access to adjacent land. But it can also be an easement for a shared well. It can be a share in a pond or river, a driveway or road, utilities, fences, etc. Knowing about the easements on a piece of land is vital. It also means there is usually a shared responsibility for repair, and upkeep.It is very common for land in the country to have easements.

--Mistake 8- Dirt is dirt. Why do I need tests?
Geological report, Natural hazard report, and soil test tell you what kind of dirt you have. You need to know if you are building on top of bad soil...asbestos for instance. Or maybe there used to be a garbage dump or an abandoned mine on the property. Some old properties may be part of an old military base. Some abandon military properties have all kinds of nasty things like tanks with rocket fuel or live ammunition buried in the dirt. Getting a geological report and soil test on any raw land should disclose this.

Flood zones, earthquake zones, high fire zones-- all of these can impact how you can build, where you can build, and how much insurance you may have to buy to protect against these natural disasters. There should be a Natural Hazard report that will disclose these.

--Mistake 9- Laying rock, oil dirt, asphalt or concrete is expensive, I am fine using a dirt road.
Road access-- What kind of road is there to get to the property? If it is dirt, you may want to try it out after a heavy rain. A dry dirt road in summer can become an impassable mudslide in winter. If it is an oil dirt road or gravel, you will be responsible for reapplication. Dust from a dirt road is hard on car parts. you may always need ot have a four wheel drive.

--Mistake 10- The agent said the property line goes from the fence in the back to the road in the front and the tree lines on both sides--plenty big for your new horse ranch.
Not necessarily. The only way to know for sure is to get a survey. This is important because you want to know where your legal boundaries are. It is nice to have the seller wave his arms and tell you the ranch you want to buy is as far as the eye can see. Maybe Mr. seller is partially vision impaired and to him that means as far as to the end of the drive...not to horizon line. Know just how far and wide your new dream horse ranch you are purchasing really goes.

Purchasing a piece of rural property is quite different from buying a nice little house in the suburbs. There are many more things that need to be considered before you sign your name on the purchase contract. If your dream is to build a house in the country, here are 10 tips that may help save you problems and expense down the road.

Source;
California Real Estate Handbook: Tips on buying and selling property by Laura Wrede