A Quick Guide to Buying Land Part 2

Are there deed restrictions on how you can use the land?

A deed is the legal document that transfers ownership of a property. It includes a description of the property, along with any restrictions on what you can build or how you use the land. Deed restrictions are found most often in communities governed by a homeowners’ association (HOA). You’ll need to follow the restrictions in addition to whatever zoning rules apply. 

Some common deed restrictions imposed by HOAs include:

  • limits on vehicles and where they’re parked
  • fences
  • types of pets
  • types of home-based businesses
  • the amount of time you’re allowed to live in an RV during the year 

Ask the HOA for a copy of its Covenants, Conditions and Restrictions (CC&Rs), which spell out the restrictions. Read it carefully. If you have any questions about the CC&Rs or if there is no HOA to obtain them from, consult a real estate lawyer for more information. A real estate lawyer can assist in obtaining this information through a title search.

Can you build on the land?

It may seem like an obvious question, but there are numerous factors that can foil your plans for building on a piece of land. Contact your county or city planning department to gather information about the parcel you’re considering. Questions to consider include:

Is the land prone to hazards such as landslides?

Is the land in a flood zoneIf it is, the flood designation could require flood insurance, which can cost hundreds of dollars a year.

Does the land contain wetlands or other environmentally sensitive areas? 

What is the land’s topographyFlat parcels are the cheapest to build on. If you have to move a lot of dirt and trees to create a building pad, it’s going to cost more to build. 

How close to the property line can you build? Local governments impose building restrictions called setbacks on property that will affect where you can build on the land. A setback creates a buffer zone of sorts. It establishes a minimum distance between the home you want to build and a curb, property line or other structure. Setbacks, which contribute to safety, aesthetics and privacy, differ depending on locale. Take the property setbacks into account when determining whether there is a large enough building space for your home in the area you want to build. 

Is the soil suitable for building? A simple soil test or geotechnical investigation can determine how much weight the soil can handle. This is critical information that will tell you whether the ground is strong enough to support a foundation. It can be required before you can get a permit to build on the land.  

If you’re planning to farm the land or suspect there’s some contamination, a soil test can provide that information, too. And if you’re in a rural area with no sewer connections, a percolation or perc test can tell you whether the soil has suitable drainage for a septic system.

Consider adding contingencies when buying land

If you’re going to make an offer, you should consider adding contingencies that will give you time to investigate whether you’ll be able to use the land the way you intend. Among the more common contingencies:

  • zoning
  • septic system viability
  • a survey showing easements and property lines
  • environmental tests if warranted

Having contingencies can allow you to walk away without losing your earnest money if the limitations on the land conflict with your plans.

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