Buying a Vacant Lot to Build a Home – What to Watch Out For

In pursuit of owning their own home in getting their peace of the American dream, many people decide to purchase a vacant lot on which to build. The thought of having an acre or two (or even several acres) outside of the city limits and building a home that can be customized to your specifications is very appealing to many. But before moving forward with the purchase of a vacant lot, there are several things to watch out for:

Location

The old adage “location, location, location” applies to all real estate purchases, and especially vacant land. You may love the location from the standpoint of being outside of the city, breathing in fresh air, having a beautiful view to wake up to every morning, and having lots of space to build your dream home and perhaps add some additional structures. But there are several other things to think about when it comes to location. For example, if you have children, how are the local school districts? Will your kids have access to a busing? What about shopping and access to medical help? How close are you to grocery stores, malls, restaurants, hospitals, etc.? And what about your commute to work? Will you be able to handle the drive to work every day?

Here’s another issue a lot of people do not consider when it comes to location. If you are buying a lot that is a significant distance from the city, you may have difficulty finding skilled craftsmen that are willing to travel to your location. You will still most likely be able to find a work crew to build your home, but you will probably be choosing from a smaller pool of available professionals, and you can expect to pay more in building costs because of access to materials, travel, and related issues.

Zoning Requirements

A vacant lot is most likely subject to zoning ordinances that regulate how the land can be used and developed. The land may be zoned for residential, commercial, farming, or a combination of these. And if that land is in an established subdivision, there may be additional laws, regulations, and requirements that apply. Check with your local authorities (e.g., city and county) to determine what the zoning ordinances are, and if you will be allowed to do what you want on the land. For example, if you want to build a house and have horses on the land, be sure you are permitted to do both.

Easements and Restrictions

Are there any rights of way or other easements that cross the property? Are the boundaries of the property clearly marked? Are there any natural hazards, environmental restrictions, or historical designations that affect the property? Does another party own mineral rights, water rights, or timber rights to the property? You will need to do a title search to uncover the answers to these questions and find out if any other potential title issues exist. Your lawyer may also advise you to have a land survey performed as well.

Access to Utilities

Living outside of the city has many advantages, but one of the potential issues you need to consider is how you will get access to your utilities. In many cases, this will not be as cut and dry as it would be living in an urban or inner-ring suburban neighborhood. Before you purchase the lot, find out how you are going to get your power (local power company, partially with solar panels, etc.), water (utility company or private well), heating and cooling (utility company, propane tank, geothermal technology, etc.), and phone and internet service. In most areas of the country, residents have access to high-speed internet. However, there are still some places where this may be difficult to obtain; and this could be a deal-breaker, especially for individuals who need a fast internet connection for work.

Do I Need a Real Estate Lawyer to Purchase a Vacant Lot in Alabama?

Purchasing a vacant lot to build a home on may be a great idea, but the process is full of potential pitfalls. If you are not careful, you could end up with zoning and title issues and other problems that can be very costly to resolve. And in some extreme cases, you may find that there is no viable resolution that will allow you to use the land the way you want it. To help ensure that you avoid any of these issues, it is best to hire an experienced real estate attorney to handle the closing for you.

If you are purchasing vacant land in Alabama, you must also keep in mind that Alabama is a Caveat Emptor (i.e., “buyer beware”) state. This means that the seller is not required to disclose anything to the buyer about the property’s condition. The seller’s only obligation is not to lie to the buyer. 

Your attorney will provide skilled guidance throughout the process, performing the necessary due diligence and preparing the documentation needed to complete the purchase. Your attorney can write up the sales agreement, perform all the title work, order the land survey, check with the city and/or county about zoning requirements, check on road access, and all other important legal tasks. By working with an attorney, buyers have the assurance that all their legal bases are covered, and they will end up with a positive outcome.

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