What Do First Time Land Buyers Need to Be Aware Of?
The excitement that first-time land buyers feel is difficult to put into words. When you first dive into this long-term investment, you know that youre buying something that actually has value. You can touch the land under your feet, and you can use it to build a home, farm or simply hold onto it and sell it in the future. Its far more exciting to own land than a stock; an investment you never actually get to touch.
And when you own the land, you have full control over what happens to it. This is an investment that I recommend to everyone, and real estate in general has been a very profitable vehicle for investors. Its not something that is new either people have been owning land since the beginning of time.
But there are a lot of different factors that first-time buyers need to be aware of before they make their purchase. Its simply not enough to give a random stranger your cash, and not really know what youre going to do with the land. Land can be an amazing investment, or it can be a major bust just like what happens with the stock market. You wouldnt invest in a random penny stock you knew nothing about, but you may invest in Facebook stock because you know about the company.
The moral of the story: you need to know little bit about the land and the buying process before you get started.
Traditional Loans for Land Are Difficult to Obtain
Land is not viewed as low risk by banks. Banks will provide you with a loan to buy your home, but they're not likely to give you a loan for land. Why? It matters what you do to the land to increase its value. Lenders know that they can sell a home if you don't pay your mortgage, but it's much harder to sell land, and it doesnt provide the same return on investment that a home would in most cases.
Youll have a few avenues to pay for your land:
* Owner financing
* Cash payment
What many people choose to do is buy a small lot of land, and learn about the land buying process. Theyll flip this property, and reinvest into a new property until they buy a substantial piece of land. This the perfect situation because it allows you to understand the land buying process and what makes land valuable.
Start saving now, so you can buy a property.
If you're planning a commercial venture, you may be able to get funding for the land itself. Lenders may be able to provide you with a loan, but I wouldn't rely on traditional lending practices when buying a piece of property.
EasementsEasements are very difficult to understand, but they're essential for any homebuyer to become accustomed to before buying. Essentially, an easement allows you access to your land. If your property is in between two different parcels of land, an easement may be in place that allows you to use your neighbors road to access your property.
There are also different types of easements:
Express Easements: A written agreement between the land owners granting the easement.
Implied Easements: An implied easement is when an easement would be granted for the enjoyment of the land. This often occurs when a piece of property is divided and sold.
Prescriptive Easements: An easement that is been granted because an individual has utilized an easement for a given time period.
You need to know what easements exist on your property, and ensure that youll be able to use the property accordingly.
Liens May Exist
Whether youre buying a home or a piece of property, you need to know if any liens have been taken out against the property. This normally occurs when the previous owner does not pay their taxes accordingly. If there are property taxes outstanding on the property, you'll be responsible for paying these property taxes as the new owner. Always make sure that the property is free and clear of any liens before you purchase it, or at least be notified of them prior to finalizing the purchase.
Property Taxes Can Be ExpensiveProperty taxes are normally much less expensive on a raw piece of land, but you also need to ensure that you know what the current property taxes are for your particular property. Property taxes can go up yearly, and youll want to know what the tax rates have been for the past three years.
You need to know this information so that you can understand how much youll be responsible to pay to the government every year. If the property taxes are immense, this may negate the return on investment that you would get as the property increases in value.
Land drainage will be a very important factor when buying land. You dont want to buy land that routinely floods because it will not be a smart investment. This type of land is obviously less desirable, and not the best option for any piece of farmland or even residential land.
Soil Quality Matters
In the event that you're buying farmland, you'll want to ensure that a soil test has been performed. This will help you understand the quality of the soil, and what needs to be done to the land to restore it to a premium quality.
This is most important with farmland, and you should consult with an expert before buying farmland to ensure that it's a quality property.
Land enhancements will be one of the following:
* Utility line hookups
* Water lines
* Septic systems
* Road access
* Cleared land
All of this information is very important when buying land. If there are already utility lines in place, this means that you'll have to spend less if you want to build a home or structure on the property. Cleared land also allows you to quickly start the building process if you wish, and is far more desirable than raw land if using the property for residential purposes.
LandCentury.com specializes in selling wholesale real estate at the lowest prices. We believe that everyone should have the right and the opportunity to get a great deal on investment property All you have to do to get the property you’ve always wanted is follow these simple steps:
Step 1: Find the Perfect Property
Use LandCentury.com’s powerful network of real estate listings to find the property of your dreams. We have everything from move-in ready investment properties and cheap houses to rural land, buildable lots, and fixer-uppers. No matter what type of real estate you’re looking for, you can find it at LandCentury.com
Step 2: Click the Buy Button
This will start the purchase process. As one of America’s top online property listing sites, we leverage our unique business model of submitting an online payment to hold the listing to make transactions straightforward and secure. Our purchase process is designed for simplicity and security. Once you click the buy button, you will:
Use our secure site to submit your processing fee. We make every effort to protect your privacy. That’s one of the reasons why we offer a 24-hour money back guarantee on your processing fee, so you can feel confident in your transaction.
The seller will contact you within the next 24 hours procced to the next step and get the necessary info to prepare the contract.
Buyer Transaction & Privacy Protection
LandCentury.com stands behind our buyers, and we want you to know that your hard earned money is safe when doing business through us. That’s why we have a number of features to help protect buyers, including:
Symantec Secure Site SSL certificate, providing a $1,500,000 warranty on every transaction
Secure encryption and data protection
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If you feel that you have been a victim of real estate fraud, there are many resources available for you as the victim. Your first step is to contact the local District Attorney’s office and report the incident. Our office will stand by you and provide any relevant information to support your claim. Here are additional agencies that can assist you and provide more resources: