How to Buy a Lot for Building

Choosing the best lot on which to erect a building is as important as the design of your building. There are many factors to take into consideration before tendering an offer. A good real estate agent is a significant plus when purchasing real estate, but there are steps you can do yourself to minimize costs. Below are some important considerations whether you want to buy a residential or commercial lot.


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    Check with local zoning authorities to make sure the area you are considering is zoned for what you plan to build. A residential building lot in an established neighborhood will often have many restrictions regarding home size, outside finishing materials, set backs from the street and sometimes even the size of the building itself.
    • Drive around the neighborhood, checking out the yards to see if the local homes have fences, garages or other outbuildings. Check to see if the houses are in good repair and the landscaping is well maintained.
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    Check that the building lot has utilities available or that you budget the cost of having utilities brought to your building lot.
    • If the lot uses a septic tank instead of public sewers, make sure there is enough land on the lot to support the size of the septic tank you will need for your building. Septic tanks need a leach field, the size based on the capacity of the tank, all around it and it must be contained on your property.
    • It is very expensive to dig a well if public water is not available, plus you might have to install a sprinkler system if there are no emergency fire services available. A sprinkler system needs a high volume of water and heavy water pressure which could be difficult to achieve with a well.
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    Check the local tax rates, and compare with available lots in other nearby cities and towns. Many cities offer tax abatements and/or reduced taxes for companies willing to build in areas of low occupation.
    • These abatements or reduced taxes are usually offered for a limited period of time, such as 10 years. The city is betting that 1 successful business in the area will bring in more businesses, which in turn will bring families working in those new businesses who will buy homes.
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    Hire a reputable real estate agent and discuss your needs and concerns before buying a building lot. Have a list of what you have done as well as any government documents from the various local authorities. Chances are, they will be able to answer any questions left unanswered or at least know where to find the answers for you.
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    Hire an architect to draw up a set of blueprints flexible enough to make changes based on the lot you are considering, and get written approval for your building plans from local authorities.


  • Buy the biggest commercial lot you can afford to allow for parking, especially if you are planning to expand your business. Sometimes it's better to build in an unincorporated area with more available land.
  • A commercial building lot on which you plan to erect a manufacturing plant will likely come under scrutiny by local authorities. Many cities and towns will demand to know exactly what you will be manufacturing, the materials involved in producing that product, what waste you will produce and how you will handle disposal of the waste sent to them, in writing, for approval before issuing a building permit.

Things You'll Need

  • Zoning permits
  • Cost estimates
  • Building blueprints

Article Info

Categories: Buying Property