How to Correctly Select A Lot For Your New Home

I will start this article by advising you to do your homework, in other words plan, plan, and plan some more

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I am not putting down sellers, or Realtors, but I have seen time and time again where Realtors or sellers relay incorrect information to the buyers such as, ” Lot ready to build on” when it is anything but. A great example of this happened to me a few years ago. I signed a contract to purchase a lot where the seller said sewer was available, I found out different. During the due diligence period I found out it would work but only after I installed a $20,000 lift station! Fortunately I found this out early and was able to get out of the contract and renegotiate it. Let the buyer beware.

The following is a checklist and to do list. Hopefully you will read this article before you have actually purchased your lot, as some of the items below are best done before the actual purchase of a lot.

  1. Assess your financial situation and obtain mortgage preapproval, to set your building budget.
  2. Narrow your search to areas within 10% to 15% of your target price.
  3. Start developing a list of what you must have, what you would like, and what you don’t want in your new home.
  4. You can select a builder at this point or at any point in the future and he can help guide you through the process. My article “Destroying the 3 Bid Myth” can help you in that process.
  5. Is the lot in a development that has conditions and/or restrictions on what and how you can build?
  6. Do these conditions raise the price of your new home out of your price range?
  7. Is the lot of sufficient size to hold your home with all the setbacks intact?
  8. Are there any pipelines buried on the property
  9. Is there public water and sewer?
  10. Are electric and gas service available nearby
  11. Are the soil conditions suitable for building a home?
  12. If needed is the lot of sufficient size and are the soil conditions conducive to a septic system, and/or well?
  13. Is it in a floodplain, are there wetlands?
  14. Were there any buildings previously built on the site?
  15. Is there anything buried on the land?
  16. Define the buildable area of the lot
  17. Select an architect to design your new home
  18. Share your budget and list of wants with the architect.
  19. If you have not selected a builder, you should do so now.
    1. Talk to friends and ask for referrals
    2. Drive the area you want to live or where you own your lot, looking for builders.
  20. Be open and honest with your builder; share your budget, and time frame.
  21. Communication is the key to any building project, make sure the builder you select has good communication skills, and you feel comfortable with him/her.

This list is by no means all inclusive; it is a starting point and a general guide. Conditions and requirements vary greatly, from region or even town to town. Always remember to do your homework, plan, plan, and plan some more.

 

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