But buying land without being prepared can leave you feeling disappointed, frustrated, and possibly suffering financially. Knowing these 8 things before you buy will give you confidence to move forward with your homesteading dreams.
1. Unwanted Easements
Simply put, an easement grants someone the legal right to use your property. This could mean a neighbor uses your driveway to access their house. It could mean that your neighbor has part of their septic drain field on your property. Most often, easements are granted to utility companies to run power lines. It is a good idea to be aware of who has legal permission to be on your desired homestead land.
How can you learn who has an easement on your land? After paying your earnest money your real estate agent will request a preliminary title commitment for your desired property. This may take the title and escrow company several days to research, so be patient. When it is finished you will have access to all the easements they were able to find in their research.
Typically each item will also include a separate document describing the legal rights for the easement. Go over this material carefully with your real estate agent. Sometimes title companies use words that are not typical in everyday speech. Don’t be afraid to ask your agent the meaning of each item. It’s important to understand what you are buying. Our agent told us, “There are no dumb questions when it comes to title searches.”
2. Utilities on Property
Do power and phone lines run close to your property lines? If not, consider the cost of this. It can get quite expensive to run utility lines. If you are unsure of what to look for, ask your agent. He or she can go to your desired property and help you locate the nearest utilities. Hopefully you have a very helpful agent. We were fortunate to have a real estate agent who went over and above to assist us. For more tips on finding a good real estate agent for homesteading land, you can read all about the process of picking and eliminating agents in this article here. A good agent can make your search so much more efficient!
3. Property Taxes and Exemptions
Ask your real estate agent to show you how much the property taxes were for your desired property the previous year. Also ask him if there are any tax exemptions you can apply for. Our agent was kind enough to encourage us not to buy less than 6 acres. This was so that we would be eligible for a forest land exemption which in turn would decrease our property taxes. This website includes the application and designates 2 options within the timber program for Bonner County Idaho.
4. Building Restrictions
When you buy land in a planned development you are obligated to join the community’s Homeowner Association (HOA). There is usually a monthly or annual fee associated with the HOA for the upkeep of the common areas in the community. These fees help maintain the quality of life for the residences and property values for each member.
Now here comes the bad part for homesteaders. There are certain rules called CC&R’s that every resident must follow when living in a HOA. CC&R’s are covenants, conditions and restrictions. For example, many housing associations place restrictions on noise levels and the types of pets that are allowed on the premises. This could be a problem for you if you are planning on raising farm animals. When we were searching for land, one CC&R limited farm animals to chickens, no roosters, and 2 horses, as long as the horses were in a coral.
We also found that HOA’s restrict what kind of buildings you are allowed to build on your land. If you want freedom to build and farm I recommend purchasing land that does not have a HOA or CC&R’s.Your real estate agent can exclude any properties that have HOA’s to make your search easier.
5. Illegal Parcels
Sometimes land has been divided but not legally. You want to be confident that the parcel you are considering buying is documented the same on paper. You can apply for a certificate of compliance, which is a determination by the Planning Department of whether a parcel of land was created in compliance with the subdivision and zoning ordinances in effect at the time the parcel was created. There is a fee. The one we were looking at in Bonner County Idaho was $200.00. It could take up to 60 days to complete the review.
We did not file for this certificate but if you are not confident that your parcel is legal it might be a good idea and provide you some peace of mind. What we did do was talk with our Escrow Officer with our title company. She opened up the parcel record books and after her evaluation we felt comfortable that there was nothing to be concerned about.
6. Flood Zones
This is something to take seriously! Land that may seem green and lush in the summer could be flooding in the spring. There was a 5+ acre parcel we were falling in love with that had a creek running on the northern border. We walked the property a few times before we noticed that the road was built considerably higher than the property line. We asked our agent to check on this for us, and I’m glad he did. He pulled up a map that showed flood zones and almost the entire property was under water. It’s definitely something to be aware of. We kept being told, “It’s buyer beware.” Do your homework ahead of time so that you don’t get any nasty surprises.
7. Septic System Concerns
There is a fairly simple test called a Perc Test (also known as a “Perk Test”, and more formally known as a “percolation test”) that you should do to ensure you can install a standard septic system on your land. Basically a Perc Test is an evaluation of your soil. A lot of homestead buyers don’t do a Perc Test prior to buying land, but we felt it was a contingency before purchasing. We intended to install a standard subsurface septic system and wanted to make sure we were going to be able to do that.
Steps for Perc Test:
- Fill out application for subsurface sewage disposal. A speculative site evaluation fee costs $400. On the application you will estimate to the best of your ability where you wish your test holes to be in relation to the buildings you wish to build or are already on the property. You will include any roads, known well locations, ditches and streams if applicable, and driveway. Try to be as exact as possible.
- If you are going to be digging the holes yourself, contact the site evaluator and arrange a time to meet for the evaluation. If you are hiring a contractor to do the job then the contractor can arrange with the evaluator when the best time for them is and you won’t have to play the middle man.
- At the time of the evaluation, you have the ability to dig several test holes, not just one. We had 3 test holes evaluated. The first hole ended up being the best location for a standard subsurface septic system. Remember to ask the site evaluator questions. He or she is very knowledgeable about the area and the types of soil best for a septic system. Ask him for suggestions and recommendations. He will give each test hole a soil grade which will determine what kind of system you can install. If the soil is not good for a standard system he can recommend another system which is suitable. It could be that a mound system would work best for your land.
- Following the site evaluation you will receive an email or hard copy of the speculative site evaluation, test hole data, a google map of the pinned test holes, and your application.
Like I said, not all people choose to do a Perk Test before buying their homestead land. It was important for us because we wanted to know we could install a standard subsurface septic system on the property. Passing the Perc Test was one of the contingencies we included in our agreement with the seller. You can read about detailed information on seeing where and what type of septic systems your neighbors have on record in this article here.
8. Private Well Water
If you are planning on living off grid then having your own water source is going to be extremely important. Maybe you are planning on pumping water from a creek, or possibly you plan to collect rain water. One common way to have a water source on your homestead is to pump water from your own private well. A good way to get a reasonable estimation of how deep you are going to have to dig is to see how deep your neighbors’ wells are. For tips on locating wells in Idaho, you can read our guide on how to use online water resources in this article here.
Before you put up cash that isn’t refundable, make sure you pay attention to these 8 tips. This is not an all inclusive list, but these 8 tips helped us tremendously before buying homesteading land. Being equipped with these tools should help you feel more confident about the land you are buying and what, if any, limitations you have on how to develop your homesteading land. Remember to ask your real estate agent what else he or she recommends you know before you buy.
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