Build Your Own House

How to Buy Land and Build a House

Summary: When buying land to build a house try to choose a home building site where you want to live, but keep in mind that location ultimately determines land value and land cost.

Carl, How do you find land to build on and make sure that it has water, sewer, gas, Internet access, or cable, or even satellite?

Also, how do you know what kind of structure you can build on land before purchasing or what the restrictions are?

Actually, how do you find land in general for that matter, or a real estate agent?

Thank you, J. W. T.

Hi J. T.

If you have lived in a city or town for a while, you probably know where you want to build a new house.

If you haven’t been looking around, or if you are new to an area, I suggest working with a local Realtor.

These Realtors know what each neighborhood offers (including schools) and what lots cost in different locations. If acreage is what you are after, here too a Realtor is most helpful.

A Realtor can help you locate the property you want and can help with all the details necessary to assure you that it is a suitable building site such as listed below in my checklist.

CHECKLIST:

1. If water and sewer are provided.
2. All costs to get the water and sewer to your property line if it is not already there (it may be across the street); tap-in fees or privilege fees charged by the municipality or the association providing the services.
3. Cost of well & septic if water & sewer are not available.
4. Costs and availability for gas, electrical, phone & cable services.
5. Deed restrictions as to structures allowed and minimum setbacks.
6. Cost of local impact fees, if any. One way or the other, you, the buyer , end up paying these fees. Impact fees and other government fees are one time fees imposed by some local governments on new developments or proposed developments for the purpose of paying for new or expanded public capital facilities such as schools, utilities, roads, etc., required to serve that development.

In some areas these fees can seem excessive. Find out early in the game when you are searching for a building site.

The Realtor should also be able to show you a land survey (map) of the lot and point out the boundaries to you during a walk around the lot.

Find a Realtor that specializes in land.

Another possible source for your new home building site would be a new home builder or new home development.

New home builders and new housing developers often find themselves with too many building lots and are willing to sell them.

The advantages of buying a lot from a new housing development are:

  • You should be able to get a good price on a building site in a new homes development.
  • Home builders that build new homes rarely choose undesirable locations.
  • An area where new houses are being built is usually a sign of a good area to live.
  • Usually, all the public utilities and services that an average new home buyer would desire are available.
  • Read my checklist above.

Important: You should always find the land to build on first and then find home plans to fit the land and your budget.

For more details on buying land to build on, read my Chapter 2 in “Be Your Own House Contractor.” If you don’t have it, you can buy it from your favorite bookstore, or online.

Good Luck, Carl Heldmann