You’ve jumped through all the hoops to obtain financing. You’ve spent hours searching for the perfect piece of land in just the right location for just the right price. Before you fall in love with the property; however, you must evaluate the land. You have to figure out whether the land you’ve found is suitable for building. After all, if you can’t build your dream home, then the land isn’t that perfect, is it?
Step 3: Evaluate the Land
Essentially, you need to do what a land developer does for a residential subdivision, but on a smaller scale.
To evaluate the land, you must:
- check on utilities
- find out whether the land is in a flood plain
- verify zoning
- conduct a survey
- estimate how much it’s going to cost to prepare the land to build a house
- make sure there is access from the main road to your proposed building site
The expertise of a professional home builder, like Elements Design Build, helps with this important step, evaluate the land. So, keep reading to learn more about our suggestions for how to evaluate the land you’ve found. And please, contact us if you have questions.
Utilities
If you’re buying bare land (meaning land that does not contain an existing structure), it may not have any utilities. In fact, there may not even be utilities on neighboring land. This is important information to know. The type of utilities needed and the distance between your land and existing utilities can greatly impact the cost of preparing your land to build.
Even if the land you are considering purchasing has an existing structure, it is still a very good idea to check on all utilities.
Utilities Factors to Consider when you Evaluate the Land
Electricity
Electricity is the most important utility to build a house. It powers other utilities, like your well, septic system, and heat pump. Because of this, begin the evaluation of your land by locating the nearest power pole or power line. Then, determine the electric company to whom it belongs. (The easiest way to figure this out is to ask someone who lives nearby.)
After you’ve established the electric company, call them. Tell them your plans, asking for their procedures to run electricity to your building site. They’ll probably assign a field engineer to meet with you onsite to talk about available options.
Regarding cost, some electric providers will run power to your home site for free. Others, however, will charge a fee if the distance is more than a certain amount. Likewise, some will charge you for the entire installation. Obviously, it is imperative that you know this information, as it will affect your over-all budget.
Another factor to establish is whether the lines will be run overhead or underground. If run overhead, some trees may need to be cleared. It is important to know who will do this and who will pay for it.
Also, some companies won’t run the power line to your site until the slab is poured. Others will run it as soon as you tell them you’re ready. In other words, you won’t know what’s required to get electricity to your land until you ask the specific electric company who will provide service.
Water
Another important utility to check on is water. First, find out if there is city water available. If not, can you drill a functioning well? Do not assume that you can drill a well anywhere and get good water and pressure. Ask an expert! (Ask the land owners in the area to suggest well drillers and give them a call.)
When you build a house in a populated rural area, there are well drilling companies that know the peculiarities of the water table. They’ll be able to give you a good idea of whether adequate water is available. Also, they’ll be able to tell you how deep they’ll have to drill to get to it. The biggest variable in the cost of a well is depth, so this information is key.
Also, ask homeowners who have built on land in the area about their water quality.
Sewer
Sewer is the utility that’s the least likely to be available in rural areas. It has to flow downhill, which limits the areas that can be served by existing treatment facilities. If no city sewer is available, you’ll need to install a septic system.
The type of septic system and the cost will largely be determined by soil type. As with a well, do not assume that you can install a septic tank. The possibility of installing a septic system is governed by the size of the property. Because of this, ensure that the land you are evaluating is big enough.
Consult an expert in the field to get these questions answered.
Natural Gas
Although natural gas is not required to build a home, it is a nice utility to have. For example, gas stoves require natural gas, as do gas logs in the fireplace. If natural gas is not available and you want these amenities, you will need to install a propane tank. Propane heat can be used for the hot water, stove, and fireplace.
As an alternative, you could use electric for your hot water and stove. Electric heat pumps are quite efficient these days. Gas logs cannot be replaced with electric, however.
The important thing is to know which utility you will be using. After all, you don’t want to be set on an amazing gas range only to find out that you don’t have natural gas available!
Phone, Internet, and Cable
Phone service is available nearly everywhere now, as cell coverage has become more widespread. In fact, I’ve been out to some rural sites where I was shocked at how good the cell signal was! As with any utility, however, we don’t want to assume. If you want (or need) a land line, talk to the phone company about their coverage before you buy land. To be on the safe side, you may want to ask the phone company to send someone out to meet you on the land. Sometimes the office maps the phone company uses to determine service locations aren’t detailed enough. It would be irritating to call for installation only to find out that the information you received over the phone was incorrect.
As for internet, this utility is becoming a necessity for many people, as they need it to conduct work. Ensuring that you will have quality internet service for a reasonable price is important. There are rural wifi repeating stations. Plus, satellite TV is available literally anywhere you can see the sky. As with phone service, however, make sure to call and verify that you can obtain the services you need on your land.
Trash & Mail Service
Make sure to call and verify that trash service is available for the land you are considering purchasing. It would be awful to build your dream home on what you believed was the perfect land only to discover that you must burn your trash or take it to the dump yourself!
Also, as you look at potential land, make sure you know where your mailbox will need to be located. (It will be nice to know how far you are going to have to walk on those rainy days.)
Flood Plain / Flood Way
Another important step to evaluate the land is determining where the land lies in relation to the FEMA-mapped flood areas. It doesn’t matter what the land looks like, where the nearest creek is, or whether it’s on top of a hill, you can’t skip this step! You could be planning to build on a pad that’s 50 feet above and 1,000 feet away from the 100-year flood plain, but if one remote corner of that property touches the red shaded area that indicates the flood plain, you’re going to have to jump through hoops to build a house.
As with verifying utilities, get the property’s legal description and call the engineering department of the city or county where the property is located. They can tell you whether the property is affected by flood plains or flood ways.
If the property has a flood plain issue, it might be able to be resolved. This will most likely take extra time and extra money, however.
Zoning
Another vital component to evaluate the land is verifying that the land you are considering purchasing is either residential or unzoned. Because of this, it is important to take the legal description to the city or county. There, yiu can make sure the zoning is compatible with building a house. If the land is zoned commercial or industrial, you’ll have to apply for a variance through the planning commission. Getting approved for a variance can be tough. Zoning was established for a reason, and you are asking the city to rethink its plan for an area. Thus, the wrong zoning is potentially a deal-breaker.
Survey for Building a House
Don’t take the current owner’s word for it when he tells you the land goes over to that fence and then down the hill to the creek. You’d be amazed at what land owners think they own but don’t. Likewise, I’ve even seen cases where all the adjacent owners agree on what they think is the boundary. When the surveyor is done, however, they’re all incorrect.
Because of this, when you make an offer on the land, you should also make a contract requirement that the seller provide a current survey. Make sure to specify a pin survey be conducted and not just a title survey, though. This is because a pin survey requires the surveyor to evaluate the land by doing the following:
- come to the property
- physically measure and mark the boundaries
- provide a graphical and textual report of property boundaries, easements, rights-of-way, etc.
Additionally, you’ll want to see the official stakes on the land so that you can see the legal boundaries. (See “Step 4: Negotiate Price” for more information about “concessions,” including a pin survey, to include in an offer on land.)
Site Preparation to Build a House
Once you know you can get needed utilities, the land is not in a flood plain, has proper zoning, and the survey doesn’t reveal any deal-breaking surprises, you need to figure out how much it’s going to cost to clear the land to build your dream house.
As you continue to evaluate the land, note factors which will impact the price, such as:
- the density of the trees
- the slope of the land
- the distance to the road
- where the rainwater goes
- the soil quality
While all this may seem quite daunting, the cost of site preparation really comes down to two things:
- The number of bulldozer hours
- The number of dump truck hours
If the land is clear of trees and doesn’t slope more than 5 or 6 feet across the building pad, then the dozer should be able to prepare the site in a day or two. If you must clear more than 10 small trees, however, figure additional days. Additionally, if you must haul dirt in or out, the price will escalate quickly.
A home builder can help you estimate this cost. (For information about how to hire a custom home builder you can trust, sign up to receive our free e-book, “Building a Custom Home on Your Land: A Step-By-Step Guide.”)
Access Road
As you evaluate the land and estimate the cost of site preparation, remember to figure the cost of an access road from the main road to the house site. (Also, remember that you will have to pay to maintain this road, as well. There will be heavy concrete and lumber delivery trucks coming in and out. They get stuck easily on neglected roadways.)
The best way to estimate the cost of an access road is to ask the local bulldozer guy what it will cost. Believe it or not, a good way to find that guy is to drive around and look for an advertising sign on a utility pole. You could also ask neighbors who they recommend.
Need help?
Contact Elements Design Build and let us help you evaluate the land.
The next step…
Now, it’s time to make an offer.
Now that you’ve discovered the land is indeed suitable for building, it’s time to make an offer. Read “Step 4: Negotiate Price” for our suggestions about how to determine fair market value.
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