Good evening, I’m in texas, on the coast. There is a channel that is due to open a new pathway from the inner bays to the Gulf. On the island (barrier between the gulf & bays), property with homes on it has gone up in price rapidly. Would undeveloped lots go up in a similar fashion, or do empty lots tend to hit a peak at lower $ amounts? I’m guessing I could find lots for under 25K, hold onto them for a few years and then sell… hmmm… any thoughts, comments, anyone had experiences (good/bad) with undeveloped lots?
Buy Land they are not making it anymore!!! Look at it like this if you are looking to pay cash for it its as good as cash when you need to get another loan how much is the area booming?
You need to do your homework. Land is very speculative. It generates no income (rarely it does). You need to look at town maps for easements, ROW (right of ways), flood zones, zonning, taxes, and stuff like that. Also you should search the EPA’s list of known Toxic/Polluted sites to make sure you are not buy a toxic dump or a lot next to the toxic dump. Even if you think the lot is in a nice residential neighborhood, take the time and do that search. Also make sure it is buildable, and find out what you can build there!
The old Realtor saying “Buy land they are not making it anymore” is true in one aspect, but the United States as a whole, has tons of undeveloped land. Land might be scarace in Manhatten, but it’s plentiful almost everywhere else.
Right again dan732 the only way to buy it is if it is in a booming area! Right?
Land is one of the main things that goes up when you look at home prices. It sure isn’t the depreciating materials appreciating. It’s the land.
One way to turn land into monthly profits is by selling it on terms (land contract) for more than you paid for it.
For example, you buy a parcel for $20,000 and sell on soft terms for $30,000 @ 8% interest for say 5 years. You not only make $10k on the sale but interest on the 30k as well. If the buyer stops paying, there is no eviction process needed.
Do your research before you buy. Look for things like public access to the parcel, lot size, liens, back taxes, utilities at the lot, easements, and of course location. If public sewer is not around, septic must be used. Therefore, a perc test must be performed to make sure the land is viable to live on. Check on zoning. If you buy a rural zones parcel and you get it changed to residential, the taxes will go up.
If you buy land, you will general need to pay cash or find your own way to come up with financing (IE seller financing, HELOC, etc). There are lenders who will loan on a straight land sale but rates can be higher and normally 30% down will be required (more or less). As with homes, it can be hard to find a lender for those really small loans (IE 30k).
Buying lots in a nice development or an area that is heating up can be rewarding. Try to stay away from buying land out in the wilderness unless you plan to move there.