Buying land is a very exciting opportunity with endless possibilities. Whether you are looking to build your dream home, start a farm, or invest in property, buying land can be a very smart decision when done properly. However, the process of buying land can be complicated and overwhelming if you don't know what to expect. In this guide, we will walk you through the steps of how to buy land so that you are equipped with the necessary knowledge to initiate a successful purchase.
Key Takeaways:
Begin by determining your needs and budget for purchasing land. Consider the purpose of the purchase, the size and type of land required, and any specific features or amenities desired.
Use online listing services, like LandGate's marketplace, to find land that fits your criteria. Utilize advanced filters to narrow down options.
Consider consulting with a licensed local real estate agent who specializes in land transactions to gain insights and assistance in finding the right property.
Ensure you have financing in place. While cash purchases are recommended, land loans are common and often require a higher down payment and interest rate.
Make an offer on your chosen property, including the price, contingencies, and purchase terms. Remember, all offers are negotiable.
Finalize the purchase by closing on the property, which involves completing paperwork, paying the balance, and receiving ownership documents.
Utilize resources like LandApp for additional research and purchasing assistance, providing tools for due diligence and finding suitable properties.
Determine Your Needs & Budget
Before you start looking at potential properties, it is important to determine your needs and budget. It is especially important to narrow down what it is that you are interested in doing with the land that you purchase. This will help narrow down your search and ensure that you are making a practical investment. Although there are many factors to consider when purchasing land, consider the following questions:
What is the purpose of your purchase? Will you be building a home, starting a business, developing it, leasing its resources, starting a farm, or something else?
What size and type of land do you need for your intended purpose? For example, if you plan on starting a farm, you will need a larger tract of agricultural land as opposed to a small plot in the suburbs.
Do you have any specific features or amenities in mind for your land? This could include bodies of water, forests, access to utilities, etc.
Once you have determined your needs for your ideal property, it is helpful to determine your budget. Reviewing recent sale values for similar properties in your area that match your buy criteria can help with setting the right expectation for what you will likely need to pay.
Find Land Available for Purchase
Many online listing services allow prospective property owners to search for land that fits their buy criteria. LandGate's online marketplace has thousands of land listings available to view for free, along with advanced filters (such as acreage, price, and location) to help you narrow down properties that fit your needs:
Another way to find land is to enlist the assistance of a licensed local real estate agent. Many land agents specialize in specific niches, such as agriculture or recreation, who can help you find a property that fits your needs and budget. A local land expert will also have in-depth knowledge of the area and local land market, along with experience in negotiations to help you get the best deal. If you'd like to speak with a local land expert for assistance purchasing land, LandGate can initiate a referral to one of our partners.
Ensure you have financing
The recommended way to purchase land is with cash. However, most people do not have enough cash on hand to purchase land outright, so taking out a land loan is a common alternative. Many institutions specialize in land loans that can assist with this! However, it is important to note that financing land generally comes with a higher down payment (typically around or above 20% of the purchase price) and a higher interest rate.
Make an offer
Assuming that you have found a property to purchase and that you have the finances available to make the purchase, it's time to make an offer to purchase the land! This is normally offered as a document that outlines the price you are willing to pay along with any contingencies, such as a land survey or environmental testing. It also should outline purchase terms, such as who will be responsible for closing costs. Remember that all offers are negotiable!
Close on the property
Once the offer is accepted, you can close on the purchase. This is just another way of saying that the sale is finalized! Closing involves signing all necessary paperwork, and paying the remaining balance and any fees associated with the purchase. Once this is complete, you will be given ownership of the land, along with any relevant documents or deeds.
LandApp is your one-stop shop for researching and purchasing land. From conducting due diligence to finding properties for sale that fit your buy criteria, LandApp has it all! Subscribe for just $10 per month:
