You’re grandfather passed away recently. He left behind five acres of farmland near Mount Pleasant to you as the sole inheritor. You’re based in Silicon Valley running your tech company. While the inheritance is a great surprise, you’re now left with no choice but to do something with it.
Your company has become very successful, and you’re looking to buy land in Santa Clara to move your headquarters and the entire operation. This could be an opportune moment to leverage the property in Utah your grandfather left you. Your executive leadership team has suggested using a 1031 exchange to acquire farmland in Santa Clara. It’s giving you a headache. All the requirements and the legalities of buying property is just not your cup of tea. The same is true for many who are a first-time land buyer who plans to build their house. How does one buy land without having any problems?
Consider the following ideas for Buying Land
Before you dive in and sign that check to buy acres and acres of land, do your research first. If you’re interested in the land, commission your surveyor to do a new survey. Do not rely solely on old documents and old surveys provided by the seller. Get your own.
The ads from realtors are going to be enticing. Huge land for sale with a total of three acres. You visit the land, and two and a half of the acres of it are a useless cliff. So, here a few more considerations that you need to be aware of.
1. Knowing the cost
The process of acquiring a land does not end with the check paid to the seller. Consider the other cost like home loans, taxes, and insurance. Experts advise that you should do due diligence and make sure that the property is free from any liens. Make sure that you have scrutinized all the possible costs that would arise from the purchase.
2. Plan for now. Plan for the future
It’s great if you’re acquiring the land to build your house and then tend to your farm. But if you have other plans in the future, like reselling the property or redeveloping the land, say, for commercial use, be clear about this from the get-go! Are there any planned developments in the area like roads and telecommunications installation. You need to know this beforehand if you plan to sell or develop the land in the future.
3. Know the land
Doing an environmental test might be necessary, especially if you plan to put up structures, like buildings. Soil and water samples need to be tested.
4. Know the regulations
There are zoning guidelines that determine what you can and can’t build on your property. Make sure that you’ve visited the county government to inquire about the zoning regulations.
5. Insurance Coverage
Even if you get your surveyor, it does not outrightly prevent possible disputes in the future. Getting a title insurance coverage can save you from the headaches of, for example, discussions about property lines.
6. Utility services
Remember Flynt, Michigan? How about Erin Brockovich? Water is a critical utility service. You can dig your well, but water might not necessarily be potable. Make sure that water, power, and telecommunications are part of your due diligence.
It doesn’t appear to be that easy, but these are just some of the considerations you need to know when buying land.