It all starts with buying a building lot.
Whether you long for the privacy a couple of acres in the country promises, or you’ve got your eye on a cute little residential lot in a subdivision, buying a lot and building a house on it is a dream for many of us.
There’s nothing more thrilling than having a couple of acres of your own, and building your home from the ground up.
But, buying a lot is very different from buying a house or condo, where most problems can be easily identified by a competent builder or home inspector.
Even if you are quite familiar with home construction, an undeveloped piece of land can hold numerous surprises both on and below the surface determining what can and cannot be built.
At the first impression, the most obvious things jump out – the land, the lakefront, the view, distance from towns, amenities, or other people – typically the main reasons why people like the particular lot.
But there are some crucial and much less visible details that can have a significant effect on the enjoyment or the cost of developing that property – or even whether you can build there as planned.
What you can see with your eyes is important, but what you may not see — subsurface soil and water conditions, seasonal effects, zoning ordinances, deed restrictions, or a murky title — can have a far greater impact on your successful use of the land.
So here are a few important but not so apparent details to consider – questions to ask your agent, or the seller (or in some cases, the municipality)
What You Need to Know When Buying a Building Lot:
1. Is the property zoned for residential construction?
The majority of municipal regulations that affect properties relate to zoning and the acceptable uses of a particular piece of land. Most municipalities have land use bylaws that designate areas of the municipality that may be developed for residential purposes while selecting other areas for agricultural and commercial uses.
It is important to know what is permitted or restricted in each area before you build new structures or renovate or modify existing buildings. It is within a municipality’s rights to require landowners to remove structures that do not conform to zoning requirements.
2. Is nearby property zoned for non-residential use?
If it is, you may have factories or other businesses as neighbors in the future.
3. Is nearby property zoned for multi-family residences?
If it is, you may have apartments or duplexes being built in your area. If you want to build a multi-family residence, then be sure the land zoning allows this.
4. Is this a historic district?
If it is, check what restrictions or control you have over making changes to the home. Homes in historic districts may need committee approval of any exterior changes.
5. Is the area more prone to crime?
Your local police department can help you determine which areas are safer to live in.
6. How safe is the location?
A site might have a gorgeous view overlooking a cliff, but you may not want a backyard cliff if you have children. Nearby sources of water can create a drowning hazard. Is the site in a high traffic area? Are train tracks nearby? Are their rock quarries nearby? Are dangerous industries nearby? What types of pets and wildlife live in the area? For example are there violent dogs, coyotes, snakes, or wolves in the area? Is hunting conducted nearby?
7. Are there any subdivision covenants?
Will the covenants restrict things you want to do with the property? Will the covenants protect your property? Are the agreements enforced?
8. Is there a neighborhood association?
If there is you may have to pay an annual membership fee for common services and shared areas. What services are include in any neighborhood or condo associations fees?
9. What are your neighbors like and how well do they take care of their homes and yards?
Are any neighbors or their pets noisy? Are there many children in the neighborhood and what are their ages?
10. Is the lot suitable for the size, shape, and slope of the home you want to build?
Is there adequate space for recreation such as a pool, volleyball, or outdoor dining after the home is on the lot?
11. Is the property in a flood plain?
If it is, be sure you can get flood insurance and find out the price. You will probably be required to build at a certain level above the flood plain and roads should also be above the flood plain. You may be required to have an above ground foundation to elevate the height of your home’s main floor. Also, there may be restrictions prohibiting hauling dirt or fill into a flood plain.
12. Are there streams on the property or drain sewers nearby?
If you need to reroute the stream, then you may need government approval. Don’t buy property until you know you can make any changes you need. If you are near streams or storm sewers then if those water paths overflow how likely is it you home will become flooded? As more homes or streets are added to a neighbor the runoff water may increase in waterways.
13. How does water drain off your property?
You don’t want to build a home in a spot where drainage water flows. If you need to change the drainage flow, be sure you can change the flow without causing water damage to a neighbor’s property.
14. Are high voltage power lines nearby?
If so, your home may receive higher amounts of Electromagnetic Fields (EMFs). The risks of EMFs are not well known. Some studies suggest EMFs may cause cancer or other illnesses.
15. Can you hire any builder to build a home on the lot?
In some subdivisions, you may be restricted to construct with their builders.
16. What school district is the property in?
Even if you don’t have children, the quality of the school can affect the resale value of your home. What schools will your children go to and how good are those schools? Are there school buses? Will your kids have to change buses to reach their school? Where will they wait for the bus? Where will they be dropped off?
17. How convenient is the property?
How far will you travel to school, work, church, shopping, gas stations, and dry cleaner? Consider the locations you frequently visit to such as the golf course, library, beach, health club, post office, or airport. Are you near medical services? How far away are the friends or relatives you frequently visit? How far are you from day care or babysitters? How far is the bank or ATM?
18. Consider future lifestyle needs of your family.
For example, if your children are in grade school now then consider how close will your home be when the children attend high school or college. If you will be retiring soon then how will the site’s location affect activities you’ll want to do when you retire?
19. Will your home be similar in value to other homes in the neighborhood?
The value of surrounding homes can affect the resale value of your home. It is best not to have a home that is of much higher value than nearby homes. In general, the price of your lot should be around 20% to 30% of the value of your home. A real-estate agent or appraiser can provide you this information.
20. Is the home’s orientation good when considering the sun and weather?
The ideal house orientation is that the long main axis of the building runs East-West, i.e., the ridge line. You can move this by as much as 20 degrees without ill effect, but the most glass on the building must be facing towards the Sun. When deciding the building orientation also take into account the location of landscape features on your plot, i.e. trees and walls, etc. which will impact on how you harness the Sun. Ideally you do not want them blocking the sunlight as the sun tracks across the sky.
21. What are the views like?
If you are buying the property because you like the view then how protected is the view? Is there a chance somebody else could build in front of your view and block it? Is there a chance somebody else could change or damage your view?
For example, if you have the view of a forest could somebody else turn that view into the subdivision and cut down the trees? Does zoning allow trailer parks of factories to be built near your home? If your view is not protected could you buy additional land to protect your view? Keep in mind that subdivisions are often built in phases. Your attractive view may be gone within a few years as the subdivision is developed. Don’t pay too high of a premium for a view that is not secure.
22. Golf course lots – check to see if your home is within the firing range of a hole.
If so, you might have more broken windows or people invading your yard to retrieve stray balls. In general, it’s best to have your lot line at least 200 feet away from the midpoint of the fairway. Also, keep in mind that lawn mowing may be done early in the morning, and the noise may wake you up. Also, your yard may have less privacy if you are close to the golf course.
23. Is you lot near the entrance to a public area such as a park?
If so, your yard might be a common path for people who access the public area. Is there a snowmobile path nearby? You may not want to put up with the noise four months out of the year.
24. What utilities and services are available?
How do the price and quality of utility services compare to other areas? For example, look into the availability of sewer, water, gas, electric, TV cable, phone, internet service, garbage pickup, postal and delivery service, school buses, train station, and other public transit. Some utilities may be planned but won’t be available until enough homes are built. For example, TV cable may be planned but might not be installed until there are enough homes built in your area.
25. How far is the home from emergency resources such as a hospital or fire station?
Are emergency services such as ambulances, fire fighting, and police service readily available in your area?
26. Are there any fees to connect to utilities (sometimes called tap fees) and if so how much are the connect fees?
If the utility hookups are far from where you want to place your house, will it cost much to extend the utility hookups? How much lead-time is needed to have utilities installed to your site? How far back your house is set from the road, will determine the length of the driveway. The longer the driveway, the higher the cost.
27. Are you near steep hills?
How easy will it be to access your home during the winter? Will you hear more noise from trucks or buses when they shift gears to go over the hill?
28. How easy will it be to mow the lawn?
Steep hills are harder to mow. How much time will it take to maintain your landscaping?
29. Driveway Restrictions:
Does the subdivision have any restrictions on drive access that will prohibit you from building the type of driveway you want? If so, can you get those restrictions waived? In particular, some subdivisions put restrictions on circular driveways or wider driveways.
30. Winter road services:
Are roads promptly cleared after a snowstorm? Are you on a snow route that will have parking restrictions in the winter? Is snow removal done in your area or do you need to pay extra to get that service?
31. Road extensions:
If your home is being built very far from a road, what will it cost to build a road extension? You may be required to pay for that cost, and it can be expensive. If you need to build a bridge over a stream that can get expensive.
32. Special local building code requirements:
Some areas may have special building code requirements that can increase the cost of your home. For example, if you are building in an area that is far from a fire hydrant, or other emergency recourses are not available in your area then your home may need to be built more fire resistant.
33. Will you need a well?
If so is the water good in that area? How far will you likely need to drill for water? A soil test or nearby neighbor may be able to tell you what the water conditions are like.
Will your windows directly look into your neighbor’s windows? Will surrounding areas have lots of people passing by? For example, if you live on a busy golf course your home might not be as private as you’d expect.
How easy is it for someone to access your property? Are there unlit or hidden areas for burglars to hide? Can your neighbors see if somebody is trying to break into your home or will the garage, shrubbery or other objects make it easy for a burglar to break in without being seen by a neighbor?
36. Are there bothersome insects or wildlife in the area?
For example are mosquitoes, black flies or termites a problem in the area?
37. Are you buying the land or leasing the land?
You might be surprised to find out that when you buy a house, someone else might own the land, and you will have to pay rent for the land. If you are leasing the land, be sure you know the tenant requirements for using the land, lease term, and what happens when the lease expires.
38. Are there any special fees or taxes that will be assessed on a new homebuyer?
Some areas have fees that are assessed on new homes, and the fees can cost tens of thousands of dollars. These fees are typically assessed on people who are building a new home. Some local governments have found it easier to charge lot levies on new construction rather than raise taxes of current homeowners. Some neighborhood associations might charge fees to review and approve your building plans. Also, some areas require deposits be put down that are refunded after you conform to the covenants of the area.
39. Are there liens on the property?
You should make sure you can have clear title to the property before buying it.
40. Can you insure the home?
Some areas such as flood plains or hurricane zones may be difficult or expensive to insure. Be sure you can get affordable insurance before buying the property.
41. How much would it cost to prepare the site for construction (tree removal, dirt filling or removal, grading, debris removal, well, septic tank, drainage, erosion control, landscaping)?
Are there any dead trees or damaged trees that could fall and harm your home? If so you may want to remove those trees or trim dead branches before starting construction. Also, how much will it cost to do this? Removing large trees can be expensive.
42. What is the condition of roads or bridges you’ll normally use to access your property?
If bridges or roads are in poor condition, then they may need to be closed down in the future for repair. A closed road may be unavailable for many months, and closed bridges can be unavailable for years. If your primary access route is not available then how difficult will it be for you to access your property by other routes? How likely is it that the old infrastructure will be placed when it reaches the end of its life expectancy?
43. What is the future outlook for the area?
Is it a newly developed area? Is the area improving or are houses getting older and are not being maintained well? Are there more houses for sale in the neighborhood than in other similar communities? If so, is there a reason so many homes are for sale? Do nearby shops look to be abandoned or in need of repair? Economic conditions of nearby businesses can sometimes reflect the future outlook or condition for an area.
44. What are the surrounding neighborhoods like?
Look at the neighborhoods you will need to drive through to get to your home. Neighborhoods that are close to your subdivision can influence the value of your subdivision. If people have to drive through a neighborhood that is in poor condition or has a high crime rate to reach your home, then it can affect the resale value of your home.
45. Is there anything being planned for the future that will affect your neighborhood?
Highways and airport construction are planned many years in advance. You may want to see if something is being planned that will add noise or pollution to your neighborhood in the future.
46. What future roads are planned in your subdivision?
Sometimes people buy property on a “dead end” street and assume their home will be in a low traffic area. However, dead ends often become future wings of subdivisions and are continued. A quiet location may become a high traffic area as future streets are added to the subdivision. What amenities are included in the subdivision? Will there be sidewalks? Street lights? A community park, pool, tennis courts, or other recreation facilities? If there are any amenities that are important to you, then be sure those things will be part of the subdivision.
47. The cost of septic systems can vary considerably.
They can be anywhere from $4,000.00 for a simple septic layout, up to $30,000.00 for an engineered system. Test your soil before signing any contract. The type of soil (sandy, clay, etc.), the steepness of the lot, the number of bathrooms in your home, will all have an impact on determining the type of septic system you will require and the final cost.
48. Not all lots are suitable for all styles of homes.
For example, if your plan includes a walkout basement, make sure the slope of the lot is suitable. If it is not, you may have to import fill to improve the grade, which may cost you thousands of extra dollars.
49. Conservation authorities may have final approval on building permits for your particular lot.
It is important to confirm this. If they do, contact them directly to find out what restrictions they will impose. It is imperative you do this before signing any agreements to purchase.