Saturday, April 11, 2015 / by Steven Annth
First and foremost you may be wondering, "Why vacant land?" After all, isn't vacant land worth a lot less than houses? While it is true that vacant land is less expensive than houses, that is a blessing when it comes to your start-up capital. It is much cheaper to buy vacant land than it is to buy houses, apartments, or commercial buildings.
And as any landlord can attest, owning rental property comes with a myriad of headaches, from clogged toilets to evicting deadbeat tenants. Raw land has the advantage of being maintenance free while increasing in value over time. And if you can find cheap land, then there is almost no reason to not get involved with vacant land.
One thing to keep in mind with land is that like all types of real estate, location is everything. One tenth of an acre in Manhattan could cost millions of dollars, but travel a few counties away from the cities and you can get many acres often for a few thousand dollars. The sweet spot is when you can find an area that's close enough to a metropolitan area to be desirable, yet far enough that you can find a great deal.
The best types of sellers for cheap land are the ones who have a reasonable expectation of what their land is worth. Oftentimes, people have owned their land for decades and expect to be paid market value or higher just because they've paid taxes on the property for all these years. These are not the sellers you want to do business with.
Unfortunately, many of the properties listed on the Realtor's MLS fit this description. They think their property is worth X amount because so-and-so down the street sold it for a big amount back in 2010. But Mr. Seller doesn't mention that his neighbor's property is twice as big, has several potential building sites, and a beautiful stream running through it! Yes, sellers tend to forget these details and have expectations out of touch with reality.
If you are looking for the best land deals, it is in your interest to seek out a land expert. A professional real estate investor who focuses on vacant land often gets great deals by buying properties in bulk, and then passes the savings on to you in order to unload the property quickly. These deals are often from sellers who inherited the property, or are very behind on property taxes, or just don't want the land for whatever reason.
If you are looking for cheap land, the best things you can do are 1) establish a relationship with a land investor and 2) be able to buy quickly. The faster you can buy, the better the deal you will likely receive from the investor!
Keep this in mind as you're shopping for land. You can often get seller financing if you don't have the money to cover the entire purchase price of the parcel. As long as you have a relationship with a land expert and are ready to go, you should be able to find cheap land with no trouble at all.