Custom Home Site Land Buying Checklist

Buying the right land for your custom home is important! So how do you know if a certain lot is a good building site? This checklist will help you gather all the information you need to make an informed decision:

1. Utilities

Ensure the property is served by utilities and determine where those utilities are located in relation to the desired location of your new home.

• Electric—Is there an electrical pedestal box on the property? Is the service underground or above? How far is the nearest electrical connection from your build site? What are the development/installation costs for new service from the service provider?

• Natural gas—Unless you are in a rural area, most developments have a natural gas service provider. You’ll want to know for sure if there is natural gas to the property and the distance to the build site. What are the development/installation costs for new service from the service provider? If there is not natural gas service available, you’ll likely need to plan on propane service.

• Water—Is there a community water source? If so, you’ll want to know what the tap fees are to connect to the community water. If there isn’t a community water provider, you’ll likely need to drill a domestic water well. If this is the case, you’ll want to ensure that the land has either a well permit already secured or water rights that will transfer to you at the time of closing. Water rights and well permits can be a complicated topic, so if you are unsure about this, consider consulting with a water attorney to ensure that you will have the necessary water rights for your new custom home.

• Sewer/Septic—If you are on a community waste-water service provider, you’ll want to know what the tap fees are to connect to the community sewer. It is also important to know where the sewer service connection is in relation to your desired build site. Remember that waste water needs to run downhill… If your build site is lower than the sewer location, you will incur difficulty and additional expense to get the waste water to the sewer. If there isn’t a community waste water service provider, you’ll likely need a septic system.

• Telecom and fiber—It can be frustrating to move into your home and realize that there isn’t a reliable internet service provider! This happens more often than you would think. Be sure to ask which service providers are available and then call them to confirm.

2. Soils

The soil condition is extremely impactful on the structural elements of your home and can dramatically affect your building costs. You will want to have a geotechnical engineer perform a soil test before you purchase the land. This report will give insight into the condition of the soil, ground water, bedrock, and so on. We recommend that you have your builder review the soil report so they can advise on cost and building implications prior to closing on the land. Investing a few thousand dollars in a soil test can save you tens of thousands of dollars down the road.

3. Property Taxes

Not all developments have the same property tax structure. One development might have low taxes, and the one directly across the street might have much higher taxes. This is usually the result of the developer using bonds to finance the development costs, which are then passed on to the property owner through ongoing property taxes. This can make a difference of several hundred dollars per month (indefinitely!) to the end property owner, so it’s ideal that you understand the property taxes before you purchase land.

4. HOAs

Many developments have a homeowners association or at least some community regulations (covenants) in place that are legally binding and enforceable. Many times these governing documents have architectural design requirements that dictate minimum square footage, exterior material requirements or restrictions, landscaping requirements, and ongoing HOA dues or fees. It is important to confirm that the size and style of home you want to build is allowed in the community you are considering. Additionally, you’ll want to know what the community guidelines state about other interests you may have, such as having backyard chickens or horses or, for example, whether you can park your RV on your property.

5. Building Envelope, Setbacks, and Easements

You’ll want to fully understand the usable area on the land you are buying because almost all lots will have setbacks and utility easements that dictate where you can and cannot build. Some lots have a predefined “building envelope” that the developer has established where the home must be built, and it’s important to note that the size of the building envelope needs to accommodate the footprint of the home you intend to build.

6. Topography

This may go without saying, but the physical attributes of the land you buy will affect the style, aesthetics, and build cost of the home you can build on the land. For example, if you want a walkout basement, you’ll want to find land that naturally allows for the lower level of the home to walk out. And, just know that building on a hillside is going to cost more than building on a gently sloping or flat lot.

7. Future Development

You’ll want to ask the right questions about any plans for future development in the vicinity of where you’ll be building. Is there a future road planned in the open space behind you? Is there a commercial center zoned adjacent to you? Does the developer have future phases of the community that will affect your views? Remember, unless you own the land around you, you have very little input on what happens with it in the future. Make sure to ask the right questions—to the right people—to better understand the possible changes that could happen around you in the future.

8. Zoning

You’ll want to confirm with the local city or county that the zoning of the property allows for the way that you intend to use the property. For example, do you intend to have an accessory dwelling unit or a guesthouse on the property? Do you want the ability to use your home as a short-term rental? Do you have a small business that you want to run from an outbuilding on your property? Do you want the opportunity to subdivide your land in the future? Do you have a dream of using your beautiful land as an outdoor wedding venue? The zoning of the property will have very specific allowed and prohibited uses. Make sure you look into this before you close on the land.

9. Public Services

There are the obvious considerations such as which school district your kids will go to and how close the nearest grocery store is, but you’d also be well served to take into consideration, for example, the following factors: How close is the nearest hospital? Where is the nearest fire department? How long will it take law enforcement or first responders to respond to your location if you had an emergency? Who is responsible for maintaining the roads, and do they provide snow removal?

Of course, purchasing land is not a one-size-fits-all transaction. You’ll have your own reasons for selecting the land you want to build your dream home on. Use this checklist and you’ll have lots of great information to help you make an informed land-buying decision!

If you need help with buying land in Colorado Springs, Monument, or surrounding areas, we have in-house licensed real estate agents on staff who would love to help you purchase land for your new custom home! You can learn more or request a free Land Buying Consultation by clicking HERE.