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Factors to consider when evaluating land for sale- Part 1

Posted by Denkolimited on August 15, 2018
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The stock market has been known to rise and fall dramatically. When prices are low, investors have turned their attention to purchasing plots of land for sale. Whether land buyers are looking for a parcel of land to develop as a home or as a commercial site, or whether they are strictly interested in land as an investment, they will discover an abundance of land parcels available for sale.

When searching for land, buyers should be aware of all available options before making a purchase and evaluate Land Parcels Objectively

Buying a parcel of land is a serious investment, and it’s always a good idea to consult a financial advisor or accountant before making any investment decision. Land buyers should determine what their goals are for purchasing land, including buying land for building a home, business, speculation or other ventures. The following are factors to consider when evaluating a parcel of land for sale.

 

Think about Financing land for sale

Many lenders are reluctant to offer financing for raw land and, if available, loans tend to be at higher rates and for shorter terms than home mortgages.  If you are unable to pay cash for a property, owner financing may be an option with 20 to 30% down payment and a 1 to 10-year loan term.

 

Land for sale- Think about Zoning Requirements 

Zoning laws govern what can and can’t be done with the land in a specific region. Essentially, zoning laws are the reason you don’t have a skyscraper or a huge Nakumatt mall in your backyard or a sewage processing plant right next to a town square. Check with local authorities (county govt officials) to determine zoning ordinances and whether you can build the type of home you want before committing to buying the land. Ask about future zoning, whether there are plans to put in shopping centres, businesses, parks, roads, schools or airports and where they will be, or to change nearby land uses that could also devalue your land. If the property was historically part of a larger tract, there might be restrictions that were put in place when the property was divided.

 

Land for Sale – Think about Location

Location, location, location. This time-honoured mantra applies equally to land acquisition as it does to property. Think about it: No matter why you’re purchasing a piece of property, nothing is more important than its location. Ideally, you should determine your ideal balance of convenience & congestion vs distance & serenity.

Whether using the land for a self-build project, for personal use or redeveloping it for profit, one should always have an eye on resale, and you are far more likely to achieve a higher resale value if the location of the plot/development is convenient to transport links, shops and amenities.

So before shopping for a piece of land, you should develop a general idea of where you’d like to make a purchase. You can go for an exploratory drive and use online resources to help you. For example, if you’re buying a few acres of land to build a house, you’ll likely want to consider things like access to schools, your job, grocery shopping and restaurants. If the land is for business use, choosing won’t be so easy — you’ll have to analyse a prospective location’s business value carefully. But if you’re already planning a business, you should have that in mind already. Whatever kind of land you’re looking for, the costs can add up quickly even before you start construction.

 

Land for sale- Think about Utilities

Those of you looking to invest in property and keep it original and unaltered won’t have much use for utilities. For everyone else, they’re a vital element of the equation. Any vacant land you’re eyeing for a home or business will need utility access. You’ll want some or all available utilities piped into your property when construction begins.

One way to bypass this concern entirely is to purchase vacant land that already has utilities installed. But if you don’t luck into such a purchase, you’ll have a few things to take care of, and they’re all going to cost money. You’ll have to deal with the power company to have your property connected to the nearest power lines. The same goes for water and sewage systems. Water and sewage could potentially be more work. Vacant lots that aren’t close enough to water and sewage lines will need boreholes and septic systems to gain access to these two utilities. That means added expenses and added hassle, as you’ll need permits for drilling a borehole and installing a septic system.

 

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