Sunday, December 28, 2008
Evaluate Land Parcels Objectively
Buying a parcel of land can be a serious investment and it’s always a good idea to consult a financial advisor,accountant or experienced personal such as agents before making any investment. Determine what your goals are for purchasing.Are you buying for yourself?family or investment?What are the minimum requirement?The following are some of the other factors to consider when evaluating parcels of land.
Location, location, location
Many buyers prefer to be close to schools, shops, banks, post office,hospital/clinic for emergencines ,cinemas/shopping malls for entertainment and easy highway access to the city. So, Aparrently, land that’s close to amenities will command a premium.
Moreover, builders may charge you more to build on remote parcels of land.You may also consider access to electricity,water, telephone utilities and internet service.
Find out about homeowner’s fees. Do mandatory fees apply to your plot of land? If so, you’ll have to pay them. If you don’t, the homeowners’ association could put a lien on your property or even foreclose on it.
Building challenges and obstructions
For most people, the most critical question to answer before purchasing land is: can you build on it? If the land can’t support a foundation, or has no access to a sewage system, it may not have development potential.Some lands previously were mining ares.Checked with the authorities for the land report.
Research the soil topography and quality. Damp, moist soil, steep slopes ,hills all increase the cost of building the house.
Finally, research road access. Consider the likelihood of natural disasters such floods, heavy rain, or snow that could limit road access in the future. Maintain the road with your local authorities or neighbourhood if its not accessable through public road.
Zoning and environmental considerations.
Once you’ve determined that you can build on the land, research zoning. If the local zoning ordinances dictate that you can’t build on the land, or your land borders water and is subject to environmental regulations, both may hinder your building plans.
Next, research the county’s long-range plans. Find out where the new businesses,shops, parks, roads, or schools will be that will affect the resale value in future.
Secure Land Parcel Financing
Once you find the land of your dreams, it’s likely that you’ll need to secure financing. While financing for land can be more difficult to locate than that for an existing home, there may be other options.
*Local, savings, and community banks: Loan officers at these locations know the area and possibly even your specific parcel of land. Note that you’ll have a better chance of securing a loan if there are other improved properties, or brand new properties, in the same area.
*Traditional seller loans: Typical seller loans generally require a 20% down payment, with the seller holding a note for the balance. The interest rate and terms of the loan, however, are negotiable. Other factors that impact the final terms of the loan include: the location, size, zoning, and intended use of the parcel.
Choose a loan package that adequately covers both the cost of the land and the cost and complexity of building and construction. Be sure to factor in the cost of liability and homeowner’s insurance when opting for a financing package.
Of course, real estate investments can be a complicated matter, so you should be sure to also consult a tax professional.
Once you know what type of land you want, go to the Real Estate portal, Else look for newspaper Real Estate section or get any help from local rel estate companies.They would provide agents for you.
Buy Land With Confidence
Finally,you should conduct your own due diligence into all aspects of a real estate purchase and depending on your situation; you should get assistance from experts, including a licensed real estate broker, a property inspector, title/escrow company, attorney, and/or financial advisor.
You may need to take note on below issues too.
* Price: Am I bidding on the full price of the parcel, or am I bidding on a down payment?
* Title: Is the title clear; that is, free of liens, easements, and other encumbrances? If the title isn’t clear, what are the easements on the property?
*Insurance: Can I get title insurance at my own expense?
*CCRs: Are there any covenants, codes, and restrictions on the property?
*Deed: What type of deed will I be getting?