Development Costs To Consider When Buying Land

Have you found the perfect plot of land for a great deal? If so, it’s essential to consider all the hidden costs to develop it before making a purchase. Professional developers that buy large tracts of land to subdivide usually plan on paying more for development costs than they do for the property itself. Even more, the costs to develop land is often different for a single lot buyer at retail pricing. That’s why it’s essential to get a realistic estimate of how much it will cost to develop a piece of land before purchasing it. 

Estimating Development Costs

Once you find a piece of land you want to purchase, take into consideration how much it will cost to develop it before you make an offer. If you are looking at two different land plots for approximately the same size and price, it's important to consider which one will require certain utilities to meet your specific needs. 

If you choose to buy the plot of land that doesn’t have utilities, you will have to factor in the cost and effort to add them to your property. This includes water, septic, power, gas, telephone, cable, and more. For many rural properties, water is unavailable, which will require you to drill a well and install a septic system. 


A well is required to tap into and deliver water. It must be drilled deep enough to reach an underground aquifer or layer of water-rich soil. Generally, it’s best to contact a local well driller to estimate the potential costs of drilling. Keep in mind that you will have to pay for this service, whether or not they hit water. While the cost of drilling a well is one thing, you will also have to pay for a pump and pressure tank. 

Septic System

A septic system should function cleanly and efficiently. That’s why you will need a local septic agency that will closely monitor the design and installation of your septic system. Keep in mind, however, that not all land is suitable for a septic system. That’s why you will have to factor in testing for compatibility, which can take several months due to the evaluation process.  


Contacting a local power company can help you estimate the cost of adding power to your land. 

However, these costs can vary, depending on how far away your land is from the closest power source or if you want power lines to be run overhead or placed in the ground if applicable. 

Developed Lots

Even if you plan on purchasing a “developed” lot, it’s important to make sure you know what’s included in the land package, as this can vary greatly depending on one developer to another. This will help you to know if you will have to pay for any additional permitting, site work, and fees. 

Important Site Development Costs To Consider

  • Cost of Land
  • Permitting
  • Other Regulatory Fees
  • Impact Fees
  • Tap Fees
  • Utility Connections
  • Survey
  • Engineering Inspection
  • Water Well
  • Soil Testing
  • Septic System
  • Clearing
  • Rough & Finish Grading
  • Blasting

Land Resellers

Getting access to necessary utilities can be extremely costly when purchasing raw, undeveloped land. That’s why you should always do a thorough investigation before making an investment in new property to assure it’s not only accessible but also affordable. Aside from the asking price, you should take the time to factor in the expenses of property taxes, building your home, and adding utilities as well. 

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