So, you want to buy a piece of land and build a house on it. Great! (Probably.) Here are some considerations you should keep in mind when buying land.
Whether you should build or buy is a big topic – big enough for another blog post. But if you haven’t thought long and hard about whether it makes sense to build a house, now’s the time.
Location, Location, Location
The real estate adage of location, location, location is common because there’s so much truth to it. The most beautiful house in the world can still make your life miserable if it commits you to four hours of commuting every day. And a lot of people have paid good money to stay in shacks basically made out of palm fronds because the shacks are on white sandy beaches.
Consider location first on a neighborhood level, particularly in light of where you work and, if you have kids, where you want your kids to go to school. Consider neighborhood character, walkability, and proximity to other things that are important to you, whatever they may be. One person may want to be near restaurants and coffee shops, another near rivers or hiking trails. Consider the character of various neighborhoods or areas. This process should exclude a lot of neighborhoods, and narrow down your options considerably.
Next, consider what you can afford to spend on a lot. You should have a total budget for the build. How much of that is made up of the lot and utilities and how much is the house will vary based on how nice the lot is relative to how nice the house is. The ratio will be different for a shack on the beach than it is a mansion on the prairie. But broadly, 20-30% for the lot and the balance for the build isn’t a bad place to start. Budget may exclude some neighborhoods as well.
HOAs and Other Building Restrictions
Sticking with the neighborhood-level considerations, also take a look at zoning and building restrictions the relevant counties, cities, and neighborhoods have in place. If you’re planning a structure that is in any way unusual for an area in terms of size, construction techniques, or style, make sure it’s something you can build in the area.
Also pay attention to the architectural regulations if you’re building in a neighborhood governed by an HOA. If all of the houses in the neighborhood look really similar, it’s probably because they are required to look similar by the HOA regulations. We’ve seen regulations a page and a half long to 30-page regulations that govern nearly every aspect of a home.
Specific Lots: More Location Questions
So you’ve refined your neighborhoods or areas you may want to live, and you’ve found some lots in your budget. How should you evaluate one lot versus another?
Location. Again. It’s not a cliche.
Look at the lot’s location on a micro level. Is there a likely building envelope on the lot? How does it sit in relation to the sun? In the northern hemisphere, particularly in more northern latitudes, southern exposure is much more pleasant than northern exposure, which tends to be shadowy and dark (more on this in A Pattern Language). What are the views like?
How does the lot sit with respect to road access and traffic noise? Is it under the flight path of an airport, or near train tracks?
Use your nose too. Not many people want to live downwind of the landfill for a reason.
Consider the micro component of neighborhood character – what are the neighbors like? Don’t be afraid to knock on doors. And visit the lot at multiple times during the day, particularly in the evening and at night. If the neighbors are late-night partiers or like tuning their motorcycles at 10pm, now is the time to figure it out.
Pull up zoning information and wetlands information for the lot you’re looking at. Pay particular attention to set-back requirements, especially if you’re considering an oddly-shaped lot. You may only be able to build at the center of the lot, or far away from the views you want to take advantage of.
If the lot will be on municipal sewer and water, find out what you would need to pay in tap fees to connect to the utilities. If you’re in a more rural area you may need to drill a well or dig a septic leech field. You may also need to pay for the extension of electrical and internet lines to the lot. If those costs are in the cards, get estimates for them before you make an offer. Depending on the area, a private well could run over $100,000.
Evaluate With a Builder
If possible, walk the lot with the help of your architect and/or builder. You don’t need a real estate agent to walk around a piece of dirt. And by and large, real estate agents don’t know a ton about how easy or hard a certain lot is to build on (though there are certainly exceptions). That’s something builders and architects can give you a lot more information on. They may also have inside information about what it was like to design or build neighboring houses. Here’s how it went with us.
If everything looks good, then it’s time to put in your offer and cross your fingers.