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Important Questions to Ask When You're Buying Land

Uncategorized 13 May 2024
Eden Beach, Jindalee, double storey houses

Buying land is a significant investment. Unlike many assets, land is a passive long-term investment that offers appreciating value and versatile use options. That is why investing in land is a desirable choice for many home buyers or those looking to buy land for commercial purposes.

By understanding what to ask, you can ensure that the land you buy meets your expectations and supports your financial goals. 

Legal and Compliance Questions

Perhaps the most important step before making a purchase decision is to explore the legal and compliance aspects associated with the property. Here are some of the most important questions to ask:

What proof of ownership is available?

Asking for proof of ownership is key. Verify the seller’s legal right to sell the property and ensure the title is free from any liens or encumbrances that could affect your ownership. Requesting a copy of the current deed and conducting a title search through local land records or a title company can provide a clear history of ownership and reveal any legal claims or issues associated with the property. 

Are there any disputes over the title?

Title disputes can arise from claims by heirs, boundary discrepancies with neighbours, or previous sales that were not legally finalised. These disputes can lead to costly legal battles and jeopardise your ownership rights. Inquiring about the land title helps ensure you’re buying a property with a clear and undisputed title.

Are there any restrictions on land use?

Before purchasing land, it’s important to check whether any existing land use restrictions are in place. These restrictions can be imposed through zoning laws, building codes, covenants, or land conservation agreements and can affect how you use the property. For example, some areas may restrict building certain types of structures or limit activities like farming or commercial development.

Asking these legal and compliance questions is critical in the land-buying process. It ensures that the property you’re interested in is free of legal entanglements and meets your expectations for use. 

Seaside Madora Bay new primary school oval

Seaside Madora Bay aerial view

Environmental and Physical Characteristics

When looking for land for sale, assessing its environmental and physical characteristics is also important. These factors impact the property’s usability and value and determine the feasibility of future development plans. Here are some important questions to consider:

What is the soil quality and topography of the land?

Soil quality and topography affect everything from construction feasibility to the type of vegetation that can thrive on the land. Poor soil quality may require expensive treatments or could limit the types of crops used in agriculture. This is why having the soil tested before making a purchase is essential. Similarly, the topography of the land influences drainage, the possibility of basement construction, and even the types of building foundations that can be used. 

Are there any issues that could affect building plans?

Identifying potential natural hazards such as flood risk levels, erosion, or even landslide potential is another important aspect to consider before purchasing land. Areas prone to flooding might require additional insurance and preventive measures, while erosion can impact the stability of structures and the long-term usability of the land. Analysing historical data and local environmental studies and potentially hiring experts to assess these risks can save you from future complications and additional expenses.

What utilities are available (water, electricity, sewer, internet)?

Understanding the availability of essential utilities is crucial for both residential and commercial land use. If there are no such utilities like water, gas, electricity, sewer, and internet, you’ll have to consider extra costs and extended timelines when developing your land. Also, check whether these utilities are already connected to the land and assess the distance and cost of bringing them to the site. 

Florence, Mandogalup, aerial view of the park

Florence, Mandogalup, aerial view of the park

Are there any infrastructure improvements required?

It’s also important to ask the seller whether the land requires infrastructure improvements. These can range from the construction of roads to the installation of street lights or other public utilities. These improvements mean that you might have to pay more in the future. It also can be time-consuming and, in some cases, might require coordination with local councils or other landowners. 

Financial Considerations

Here are some key financial considerations you should evaluate if you’re looking to buy a new block of land:

How is the land priced relative to similar properties?

Assessing the pricing of the land relative to similar properties in the area will help you determine its market value and ensure you’re making a competitive and fair offer. You can gather this information through real estate agents and online property listings.

Are there factors that could affect future land value?

Several factors can influence the future value of land, including planned infrastructure developments, changes in zoning laws, economic conditions, and environmental changes. For instance, new roads, schools, or commercial centres can increase land value, while flooding risk or stricter environmental regulations might decrease it. 

Flanagan Avenue Park

Flanagan Avenue Park, Arcadia, Officer

What are the annual property taxes?

Annual property taxes affect the overall cost of owning the land. Property taxes can vary widely based on location, land size, and its assessed value. Checking with the local tax assessor’s office will provide you with current tax rates and any expected changes. High taxes can significantly impact the total cost of ownership.

How much money should I budget for site work?

Budgeting for site work is an important financial consideration that can contribute to your decision to buy a specific piece of land. Site work costs include clearing the land, grading, constructing access roads, and installing utilities. These expenses vary based on the land’s size, location, and the extent of work required.

Other Important Questions

When thinking about purchasing land, consider asking these less obvious but equally important questions:

What is the reason for selling the land?

Understanding the seller’s motivation might influence your decision to buy and your negotiating strategy. Common reasons for selling might include financial need, changes in personal circumstances, or a strategic repositioning of assets. However, if the reason is related to problems with the land itself, such as access issues or legal encumbrances, it could signal potential red flags or reasons for you to make a lower offer.

Bluestone, Tarneit artist impression aerial view of parks and surrounding houses

Bluestone, Tarniet

What are the different land options you have here within my budget?

Asking the seller about the different land options available within your budget can help you compare and make an informed choice that aligns with your financial capabilities and investment goals. It’s beneficial to know about various properties that may offer different advantages, such as location benefits, developmental potential, or lower costs due to factors like accessibility or current use. 

To ensure a smooth settlement and a sound investment when buying land, don’t forget to ask these important questions before you sign any agreements. Also, consider consulting with legal and real estate experts to navigate the complexities of land acquisition.

Benefits of Purchasing Land Through a Developer

While private sellers might offer unique properties or potential cost savings, purchasing land through a developer generally provides a safer and more streamlined option. Here are some of the main advantages: 

  • Planned Communities: Developers often sell land in carefully planned communities, ensuring that each block is not only in an ideal location but also part of a bigger, cohesive neighbourhood plan. These communities often have complete infrastructure and amenities like parks, schools, and retail centres.
  • House and Land Packages: Many developers offer house and land packages through builder partners. This simplifies the buying and building process, allowing you to move into a new home without dealing with construction details.
  • Pre-approved Sites: Land sold by developers usually comes with pre-approved building sites, where soil has been tested and the topography evaluated to ensure it is build-ready.
  • Risk Mitigation: Buying from a developer reduces the risks associated with land ownership, such as disputes over land use or hidden compliance issues.
  • Cost and Time Efficiency: Developers manage the entire development process, from infrastructure to construction, which can mean cost and time savings.

Satterley is recognised as the most prominent and reliable private residential land developer in Australia, specialising in creating extensive master planned communities. If you want to purchase a perfect block of land or home near Perth, Brisbane, or Melbourne, Satterley’s house and land packages offer an excellent investment in carefully designed and strategically located communities. Contact us today and take the first step towards securing your dream home in one of our award-winning developments.

Birds-eye view of Allara's growing community in Eglinton

Birds-eye view of Allara’s growing community in Eglinton.