In today’s unpredictable world of real estate, finding a dream home that checks all of your boxes may feel out of reach. Acquiring rural land is an attractive path to building a home custom to your needs, however you may be in the dark when it comes to first steps of purchasing land. Investing in a piece of rural property offers opportunities beyond homebuilding, especially if you plan to rent or crop share to farmers, start a business, or lease the land to hunters. Whatever your plan may be, here are three first steps to kick-start the land-buying process for newcomers:

1. Find a Land Agent

Though buying a plot of land may seem less risky than a home, there are a lot of details that can go overlooked and cause unanticipated problems. Hiring a land agent who has specialized knowledge of the potential uses of your land can save you money and reduce risk. A seasoned professional, like an Accredited Land Consultant (ALC) can navigate you through easements, zoning restrictions, environmental conditions, false advertising from sellers, and much more. ALCs are among the most experienced and trustworthy professionals in land real estate.

2. Research and Preparation

While you should look to your professional land agent for the best guidance when looking at properties, you should also do your homework and ask as many questions as possible. Before you purchase a property, you should make sure to inspect the Chain of Title, reach out to your local Planning and Zoning Department, verify that there aren’t any conservation easements, and see what utilities are and aren’t included with the property. 

These steps can be crucial depending on what you’d like to use the property for. If your main goal is to use the space for camping, hunting, or fishing, you’ll want land zoned for recreation, rather than residential. The conservation easement could also prevent you from developing the property in specific ways, like clearing, planting, and hunting, so it’s best to verify with the county or city to determine if this will apply to prospective property. 

Another precaution you can take before purchasing is to take a closer look at the environmental impact on the property. It may be wise to get an environmental site assessment (ESA) to see if you’re dealing with contaminated soil or polluted water sources. Additionally, have a surveyor identify the boundaries of the property in case the neighbors have been encroaching throughout the years it’s been sitting idle.

3. Evaluate Your Finances

In addition to determining what purpose you’d like your land to serve and how many acres you’d like to purchase, you’ll need to evaluate your finances and settle on a budget. In addition to the baseline purchase price, you should account for ongoing maintenance costs and any improvements you’ll need to make on the property. It’s common to landscape as well as put in fencing, ponds, new structures, and more. If you’re looking to build a home on the property or purchase one prefabricated, you’ll want to consider how much house you can afford on top of the cost of the land. This will help ensure your budget covers all potential expenses for however you use your land.

To financially support your purchase of land, you should consider taking out a land loan. These can come in three categories: raw land loans, unimproved land loans, and improved land loans. Raw land loans are designated for very undeveloped areas that do not have electricity, roads, or other utilities. Unimproved land is slightly more developed than raw land, and improved land is the most expensive, as it has staple amenities like water, electricity, and roads. Land loans of any kind are riskier for lenders, so they tend to have higher down payments and interest rates than a normal mortgage. You may also qualify for a loan through USDA Rural Development programs if you have a low to moderate income.

In conclusion, purchasing rural land can be an exciting new prospect if you’re looking for the perfect plot to build your dream home or start a business. Make sure to research the land in-depth before purchasing to avoid buyer’s remorse and address any potential roadblocks to achieving your goals for the property. Consulting with a land real estate professional will help you navigate the process and find the perfect plot. Though it can seem like a daunting process, becoming a landowner is a great investment in building wealth, especially with plans to improve the space.