Buying acreage, what do I need to know?

[Stuka]

I've found 25 acres in Texas I am making an offer on. Will need financing, what experience can you share with me about lenders, the process of buying, and what I need to ask about and look for in land? thanks

 

[gsganzer]

I'm interested to see some of the replies as we're beginning to think about buying land. This topic goes around frequently. There's a specific book that everyone recommends, as rural property buying can be very complex with easements, utilities, minerals and deed restrictions. It's very common for land to not have clear titles, so there's a certain level of diligence required.

I did a quick search and I think this is the book that was recommended. Maybe someone can chime in if it's not.

 

[Stuka]

Good deal. I found this for lenders https://www.findfarmcredit.com/find_local_lender
Not many to choose from. I called both and got the rate, what fees they charge. One is clearly better than the other.

 

[JRobyn]

Most "regular" banks and other lenders will not touch a loan on undeveloped land; it's something their underwriters just do not understand. So look for the local agricultural lenders like "Farm Credit". Interest rates will be higher than a typical home mortgage but should be only a point or so.

Make sure that one way or another you know exactly where the boundaries are! Your own survey is best but can be pricey.

If you plan to build a house there, pay someone to do a perk test in one or two likely building sites to be sure you will be able to have a functional septic system. Also be sure that electric and water service (municipal or well) are feasible ($$) if you plan to build.

Know what the exact status is of any/all mineral rights. Will you own them as a new buyer?

Be sure you know what the taxes will be.

There are many other less tangible considerations but these are a few of the most basic (which you probably already knew).

- Jay

 

[Redneck in training]

Go to county assessor web site and look at current land sales to get better idea what the land value is in the area. Also look at adjacent properties tax record.

 

[rustyshakelford]

Prepare to put down 20-30% unless you can get a va land loan. Farm credit places are usually prime + 1% and most will require you buy into their bank as a stock holder. We used Agri land and had to buy one share at 1k. Got it back when we paid off the land.

Like others mentioned check the feasibility of utilities. Some places are 10-15k and up for water. Power can be free to 20k and up depending on what is available out there.

Brett

 

[SirReal63]

We used Lone Star Ag, which used to be Texas Land Bank. The rates were good, and they were very flexible, approval was in a couple of hours. As mentioned inquire about utilities and how easily they are obtained. Many parcels of land have restrictions in place, make sure you know what they are and what you can or cannot do. We walked away from very prime property because of restrictions. Also see what mineral rights you have, if any.

 

[KiotiKowboy]

JRobyn mentioned feasibility/cost of your utilities. I always wondered why folks with tons of acreage built their homes next to the roads with all the noise, dust and loss of privacy. Well ... now I know - lol.

We just broke ground on our new home, 2500' of trench for electrical and water, and 3500' of driveway. Before anyone even shows up with a hammer, we'll be almost $50K into the project. On one hand, I'm sick about the upfront cost. On the other, it's our retirement home and I don't want to compromise the goal of seclusion. The driveway could have been 1000' shorter but with the additional length it will be totally out of view from the home.

I'll probably need to start a Go-Fund-Me page and have all you guys chip in before this is over

 

[flusher]

What's on this acreage other than weeds? Are these virgin acres or has it been occupied previously? Water--especially if you plan to live on the acreage. Get estimate from the driller for the well size you estimate you'll need.

Soil--septic system if you plan to live there. Get a perk test done so you'll know how large the leach field has to be to satisfy your needs or local regulations.

The 10 acre parcel in Tehama County, CA that I bought in 2005 was never occupied. It was covered with 4-ft tall weeds and a few dozen almond trees remaining from an old orchard. First order of business was to get the well drilled. Cost was $5500 (154 ft deep, 6" steel casing, 1.5 hp submersible pump at 120 ft level, water level at 55 ft below the surface, 30 gal per min with that pump, estimate max flow was ~100 gal/min, 30 gal pressure tank). Today that well would cost about $13K based on today's drilling cost.

The soil on my 10 acre parcel is gravely loam, a soil that has excellent percolation properties. For my 1800 sf, 3 bedroom house, the county required a 1200 gal septic tank and 100 ft of leach line. Cost: $3500 in 2005.

Hope this helps. Good luck

 

[Stuka]

Go to county assessor web site and look at current land sales to get better idea what the land value is in the area. Also look at adjacent properties tax record.

Excellent, thanks. I found that and it shows the ag exemption, and last 4 years property value and assessment.:thumbsup:

JRobyn mentioned feasibility/cost of your utilities. I always wondered why folks with tons of acreage built their homes next to the roads with all the noise, dust and loss of privacy. Well ... now I know - lol.

We just broke ground on our new home, 2500' of trench for electrical and water, and 3500' of driveway. Before anyone even shows up with a hammer, we'll be almost $50K into the project. On one hand, I'm sick about the upfront cost. On the other, it's our retirement home and I don't want to compromise the goal of seclusion. The driveway could have been 1000' shorter but with the additional length it will be totally out of view from the home.

I'll probably need to start a Go-Fund-Me page and have all you guys chip in before this is over

$50 for a trench and driveway? What kind of driveway? That sounds like a lot.