Buying Land How To

Thu, Jan 04, 2024 at 11:35AM

You found it, how do you buy it?
You found it, how do you buy it?

Master Buying Land: How To Navigate Your Purchase

Embarking on the journey of buying land involves more than just a financial commitment; it’s about making the right choices every step of the way. If you’re wondering about “buying land how to,” this article lays out the straightforward steps you need, from understanding financing and scouting the right location to maneuvering through legal paperwork. Prepare to chart your path to successful land ownership with the actionable advice that follows.

Victoria Duvall Realtor & Loan Officer

Key Points

  • Polk County, Auburndale, Bartow, Lake Alfred, Lakeland, Polk CityWinter Haven FL.

  • Identifying your motivation for buying land is the first step and guides your decisions, whether for residential, commercial, agricultural, or investment purposes.

  • Finding the right land involves utilizing online platforms, engaging with real estate professionals, and exploring local and government resources to consider location, zoning, and potential restrictions.

  • Understanding your financial position is key, including assessing your budget, considering ongoing costs like property taxes, and exploring financing options such as land loans or seller financing.

Understanding Your Motivation for Land Purchase

Person looking at residential land for sale

Embarking on a land buying journey begins with understanding your reasons for purchasing land. Are you planning to buy land to:

  • Construct your dream home

  • Start a business

  • Farm

  • Invest

Recognizing your objective is vital because it directs your search and decision-making process. For instance, if you’re buying to build a residential property, it’s important to assess if you qualify for a construction-to-permanent loan and consider the costs involved in developing the land, including property taxes.

Land investment, especially in agricultural sectors, is popular among investors due to its low-risk nature. But it’s vital to thoughtfully examine your investment objectives when you aim to generate profits from your land acquisitions. Whether you’re purchasing for:

  • residential purposes

  • commercial purposes

  • agricultural purposes

  • investment purposes

Understanding your motivation forms a solid foundation for the rest of your land buying journey.

Identifying the Right Parcel of Land

Comparing land prices and locations

After pinpointing your motive, the subsequent move is to find land that suits your needs. It’s not just about finding land for sale; it’s about finding the right land for you. This involves researching the land market, comparing prices, and considering factors such as location, zoning, and potential restrictions. This doesn’t have to be an overwhelming task.

Leveraging online platforms, engaging with real estate professionals, and exploring local and government resources can streamline the process and increase your chances of finding the perfect parcel of land.

Utilize Online Platforms

In the digital age, online platforms like Zillow, Realtor.com, and Craigslist have revolutionized the way we search for land listings. They offer extensive coverage, access to MLS-sourced listings, and even the potential to discover for-sale-by-owner properties.

Zillow, for instance, allows users to utilize a range of search filters, including:

  • Property features

  • Views

  • Amenities

  • Other specific criteria

This helps narrow down options and identify the most suitable matches for their land purchase requirements.

Realtor.com offers a wide range of information about land, such as:

  • Zoning laws

  • Building costs

  • Property records

  • History

  • Estimated prices

  • Essential photos for potential buyers

While Craigslist can be a useful platform for purchasing land, it’s crucial to exercise caution and ensure transaction safety.

Overall, online platforms offer an efficient and convenient way to search for land listings and gather information on available properties.

Engage with Real Estate Professionals

While online platforms can provide a wealth of information, nothing beats the expertise and local knowledge of a real estate professional. Real estate agents have access to a wide range of properties for sale, including undeveloped land, and possess the expertise to locate land that may not be publicly listed. They can also help you understand complex zoning laws and identify potential restrictions on the property. Some benefits of working with a real estate agent include:

  • Access to a wider range of properties

  • Expertise in locating land that may not be publicly listed

  • Knowledge of complex zoning laws

  • Identification of potential restrictions on the property

When selecting a real estate professional for land sales, it’s crucial to verify that they possess expertise and experience in land transactions. Land brokers or Accredited Land Consultants specialize in various types of land and possess in-depth knowledge, making them invaluable allies in your land buying journey. They can provide assistance in price negotiation, handling paperwork, and evaluating the feasibility of building or developing on the land. However, bear in mind that engaging a land broker involves the consideration of a commission, often factored into the sale price.

Explore Local and Government Resources

Lastly, don’t overlook local and government resources when searching for land. Often, these resources can offer unique opportunities and may even lead to less competition in the bidding process. For instance, local newspapers and classified ads may feature land listings not found on mainstream platforms.

Government-owned land for sale can often be found through agencies selling surplus land or from tax lien and tax deed sales resulting from property owners not paying annual taxes. By utilizing these resources, you can broaden your land search and potentially find some hidden gems in the realm of land purchases.

Financial Considerations in Land Transactions

Assessing budget for land purchase

Grasping your financial position is crucial in the land buying process, which includes assessing your budget, comprehending the costs involved, and investigating financing options. Buying land is a significant financial undertaking, and it’s essential to ensure that you have enough funds to cover the land purchase, property taxes, loan down payment, and utility installation costs.

Let’s delve deeper into assessing your budget and exploring land financing options.

Assessing Your Budget

While appraising your budget for a land purchase, it’s imperative to contemplate several factors including:

  • Location

  • Size

  • Property age

  • Property condition

  • Property value

  • Site development costs

  • Utility lines

  • The existing state of the land

Each of these factors can significantly impact the overall cost of the land and the potential costs of developing it.

Property taxes, for instance, introduce an ongoing expense that is determined by the property’s value, thereby affecting the overall costs associated with buying, renting, or investing in land. To calculate the potential loan down payment for a land purchase, one can utilize a land loan calculator. These calculators consider the purchase price and down payment amount to calculate the monthly payments and total interest.

Exploring Land Financing Options

While buying land outright with cash is ideal, it’s not always feasible. That’s where financing options come in. Land financing options encompass a range of choices, such as:

  • Land loans

  • USDA loans

  • SBA 504 loans

  • Home equity loans

  • Seller financing

For instance, an SBA 504 loan, intended to finance land purchase for business use, requires a down payment of 10 percent. On the other hand, a USDA loan, a mortgage program that offers a 90% loan note guarantee to approved lenders, enables eligible rural homebuyers to secure 100% loans.

However, it’s important to remember that lenders commonly require a down payment of 20 to 25 percent for the purchase of raw land and farms. It’s also essential to consider the down payment, interest rate, and repayment terms when negotiating seller financing. Always ensure that the agreement aligns with your financial situation and acknowledges the higher risk associated with buying land.

Navigating the Land Buying Process

Researching zoning and land use restrictions

Steering through the land buying process can be intricate. It requires carrying out due diligence, grasping legalities and paperwork, and wrapping up the purchase. But with careful planning and professional guidance, you can navigate this journey smoothly.

Let’s break down each of these steps to better understand how to navigate the land buying process effectively.

Conducting Due Diligence

Due diligence is a critical step in the land buying process. It involves:

  • Conducting a thorough inspection of the property to verify its suitability for your specific requirements

  • Examining the buildability of the property through soil tests and zoning checks

  • Obtaining cost estimates for any necessary work

This process is crucial in identifying any potential issues or challenges like zoning restrictions that could affect the value or usability of the land.

Not only does this process involve checking the physical aspects of the land, but it also includes reviewing crucial documents such as covenants, conditions, and restrictions (CC&Rs) as they outline the permissible actions on the property and any constraints to adhere to. By conducting due diligence, you can shield yourself from potential pitfalls and make an informed decision about your land purchase.

Understanding Legalities and Paperwork

A land transaction is not just a simple exchange of money and property. It involves understanding and navigating a myriad of legalities and paperwork. Deeds, for example, are the legal documents that establish and provide a clear record of the transfer of ownership from the seller to the buyer. A title search is crucial in identifying any potential claims or liens on the property, ensuring a clear chain of title, and providing peace of mind for the buyer.

On top of this, you’ll need to understand the purchase agreement. This document should encompass the following details:

  • Purchase price

  • Payment terms

  • Contingencies

  • Closing date

  • Other crucial details that delineate the terms and conditions of the purchase and sale

Understanding these legalities and paperwork is vital to ensure a smooth and secure land transaction, especially when it comes to property lines.

Finalizing the Purchase

Finalizing the purchase is the last step in the land buying process. This involves making an offer, negotiating terms, securing financing, and closing the sale. Key strategies for effective negotiation include knowing your objectives, conducting thorough due diligence, building rapport and trust with the seller, and being prepared to assert your needs.

Once due diligence is completed without any significant issues and necessary financing is secured, you can proceed with finalizing and closing the sale. The purchase agreement should be comprehensive, including the price, contingencies, and terms of the land purchase. With all these steps in place, you can successfully finalize your land purchase.

Preparing to Build on Your New Land


Upon successful purchase land, you might be keen on initiating construction. Nevertheless, before any construction or development begins, there are some preparations to address. This includes securing necessary permits and approvals from local authorities and planning for utilities and access.

Let’s delve into these steps to ensure you’re fully prepared to build on your new land.

Securing Permits and Approvals

Before you start any construction or development on your land, you’ll need to secure necessary permits and approvals. These typically include land use permits, roadway permits, approvals for hazardous waste projects, and permits for real estate development. The process to secure these permits can be complex, with steps that include determining the project scope and type, researching local regulations, developing detailed plans, scheduling a pre-application meeting with local officials, and submitting the building permit application.

Engaging with local authorities to obtain these permits involves adhering to local, state, and federal regulations and typically necessitates obtaining approvals from both the state and local government. Having secured the necessary permits and approvals, you can confidently proceed with your building plans, knowing that you’re in compliance with all relevant regulations.

Planning for Utilities and Access

In addition to securing permits and approvals, it’s crucial to plan for utilities and access. This includes evaluating the accessibility and costs of essential services such as:

  • water

  • sewer

  • electricity

  • internet

These services are vital for any construction and development on the property.

If municipal water and sewer connections are not available, it will be necessary to install a well or other off-grid water systems for water supply, and a septic tank for sewage disposal. For electricity, it may be required to have the local utility company run electric lines to the site or install a solar-generated system. Lastly, if your property does not have road access, you may need to create a road. This may involve hiring contractors, clearing the land, and potentially applying for a right-of-way easement.

Protecting Your Investment

Upon purchasing your land and wrapping up all the necessary preparations for construction, it’s imperative to safeguard your investment. This includes obtaining appropriate insurance coverage, maintaining the property, and staying informed about local regulations and market trends.

Landowners generally require property insurance and liability protection, which can be provided by landlord insurance. Moreover, vacant land insurance and landowner liability insurance are also prevalent types of insurance for landowners. As part of maintaining your property, you should engage in regular landscaping, weed management, pest control, and monitor for water issues. It’s also beneficial to rent or lease the land as an effective method of maintenance.

Lastly, staying informed about local regulations, such as land use and zoning laws, can prevent legal issues and help maintain the value of your investment.

Bottom Line: Buying Land Wisely

So, what’s the final word on purchasing land? Smart land buying necessitates meticulous research, strategic planning, and professional guidance. From understanding your motivations, identifying the right parcel of land, navigating financial considerations, understanding legalities, and preparing for construction, each step is crucial in ensuring a successful and profitable land purchase.

Before purchasing land for investment, it’s essential to thoroughly research the following:

  • Local market conditions

  • Zoning regulations

  • Potential risks

  • Location

  • Access to utilities and infrastructure

  • Environmental factors

  • Past property use

  • Potential for future development and appreciation

  • Legal and financial considerations

  • Survey and boundary information

  • Title and ownership verification

By doing so, you arm yourself with the knowledge to make wise, informed decisions when buying land.

After all, the journey to owning land should be as rewarding as the destination itself.


In conclusion, buying land is a significant investment that can offer endless possibilities. However, it requires careful planning, thorough research, and understanding of various regulations and legalities. From identifying your motivation, finding the right parcel of land, understanding financial considerations, navigating the land buying process, preparing to build on your new land, and protecting your investment, each step is significant. By following this guide and keeping these factors in mind, you can navigate the land buying process wisely and make your dream of land ownership a reality.

Frequently Asked Questions

What is the smart way to buy land?

The smart way to buy land is to consider paying in cash to avoid higher financing costs and to budget for additional expenses such as property taxes and utility installation.

How much money should you save before buying land?

You should save 15 to 20 percent of the land's price for a down payment. This will help you secure a land loan.

What do I need to know before buying land in Arkansas?

Before buying land in Arkansas, make sure to obtain a title search on the property to uncover any existing financing, outstanding liens, and to verify the seller's ownership and clear title.

Is it better to buy land first and then build?

It's up to you to determine whether buying land first and building later, or doing both at once, works best for your financial situation.

What types of financing options are available for land purchases?

You can explore financing options such as land loans, USDA loans, SBA 504 loans, and home equity loans for land purchases. Seller financing could also be an option based on the seller's terms.

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