With all the talk of rising home prices and the stock market, it’s no wonder that many individuals are looking to invest in land. First-time land buyers often find themselves a little lost when it comes to what they need to know before making their first purchase. This article is going to cover some of those basics.
For those willing to research their target acreage before buying, the property can be an investment with incredible potential for profits. Provided that you do your due diligence and manage the land properly, it could result in a lucrative purchase.
5 Things First Time Land Buyers Need to Know
Buying land is not just as simple as putting down money and walking away with a plot of dirt. Owning a piece of property requires maintenance, taxes, legal and financial responsibilities. So before you jump on that first piece of dirt someone offers up at auction or from their backyard, make sure you know what all comes with owning your own slice of paradise.
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The Land Zoning Laws
To make sure you get the land that’s right for your property investment, it pays to do some research into zoning laws, land restrictions, and other important information about a location before making any decisions.
Land zoning laws are incredibly complex and can vary widely from one area to the next. In some places, the land is divided into residential zones that prohibit certain types of commercial or industrial use; in others, every last inch of space has been designated for a specific purpose by law.
Land zoning regulations serve two purposes: they keep businesses out of your backyard while also keeping people with varying income levels close together so everyone’s needs for goods and services are met without requiring a vehicle ride across town.
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You May Have to Pay Taxes
First-time land buyers may not know this, but purchasing a piece of real estate can come with several other responsibilities, particularly paying tax on it.
Land taxes or property tax are a type of excise duty imposed by the government on property. They work by taxing property owners based on how much land they own that is in use and taxable and what kind of improvements such properties have – like houses or buildings.
This tax can either vary depending upon location or even change year-to-year due to fluctuations in property values from seasonality – so keep an eye out.
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Restricted vs. Unrestricted Land
First-time land buyers should know that there’s restricted and unrestricted land. Other than the government restrictions, there are additional restrictions put by landowners or homeowners associations.
The most common type of land restrictions are limitations on what you can do with your property, such as dictating how it is designed or even limiting its use to certain purposes only.
This helps keep the uniformity and maintain high values within a development, but it may be hard to make an attractive home if these restrictions are too strict.
Other land restrictions include;
- Restrictions on business usage- you can’t run a business out of your home.
- Restrictions on exterior constructions
- Rent and lease restrictions
- Requirements for exterior maintenance
- Limitations on types and sizes of pets
- Limitations on home color
To clearly understand what does unrestricted land mean, you need to keep in mind its distinguishing characteristic, related to the owner’s right to do anything he wants with his property. They are not restricted in any way by government regulations or zoning, so it is up to them what they decide to do on this property and how much money will be invested into making improvements for themselves. This includes things like building a house without having plans of selling it; planting crops just because someone has an interest in farming, or starting some type of farm business where people buy produce from the farmer directly.
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First- Time Land Buyers Need to Know its Feasibility
One should always do a feasibility study of the area for factors that will impact property value. You might want to research any problems related to land boundaries before deciding on which piece of land you would like.
Explore your neighborhood and compile information about possible developments to predict if future plans are coming within reach or not so much but be prepared just in case.
You also need to visit the local city clerk’s office where current permits have been issued for this specific location to predict future plans and what could potentially happen next.
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Whether There’s a Clean Title
Investing in land can be fraught with pitfalls. You may think that you have found your perfect slice of paradise, only to find out there’s a title claim on it or liens from other people who believe they own the property too. The best way to avoid these problems is by researching before signing anything and ensuring everything checks out okay.
Conclusion
Buying land is a huge decision. You’ve finally found the perfect piece of property, but you need to be sure that it’s feasible and has the right zoning for your needs. If you have any questions about what restrictions might come into play on this plot or if there are any undisclosed liens against this parcel, make sure you ask these important questions before buying.,