Thinking about buying land for building a home in the coming years? You have probably heard that this can be a strong investment, especially as the Nanaimo real estate market continues to grow.
Buying a lot to build on can come with many different challenges, and knowing what to expect as you start to weigh your options can save you headaches down the road. If you are looking for a lot in the near future in and around Nanaimo, BC, here are some tips to consider that will keep you on the right track.
1. Look Into Utilities
Access to utilities is an important place to start, since this has the potential to be a costly part of the process. If you are buying a lot with an existing home that will be torn down, you will have an easier time organizing utilities. All you will need to do is arrange to have utilities disconnected before demolition, then reconnected when they are hooked back up.
If you are looking into vacant lots, things get more complicated. Inquire about hookups water, electricity, and gas. Don’t forget to check into internet access too, since connection in some rural areas can be a headache.
2. Capitalizing on Locational Opportunity
Growth in the suburbs is steady around Nanaimo right now, and this is reflected in the amount of land for sale in Vancouver Island. Teardowns can be tempting, but empty land in developing suburbs can have a lucrative upside. When considering lot purchases,research which developing areas have the highest potential in terms of growth. As well, pay attention to community amenities like schools, parks, and local job opportunities.
Of course, many land sale opportunities will be billed as the next big thing. Talk with an expert in local real estate to cut through the fluff and find out what people are really interested in.
3. Understanding the Area
Aside from knowing the benefits of the area where you could be buying land, it’s also a good idea to be aware of any major drawbacks. This could include offensive odours from farms or factories, busy all-terrain vehicle routes, or arterial roads that are soon to be snarled by traffic.
Some of these drawbacks vary based on season, so it can be difficult to stay aware of every possible outcome. The best way to know for sure? Talk to locals and spend time visiting the area yourself.
4. Consult a Builder
Whether you are building from scratch or tearing down, bring a builder into the picture as early as you can. An experienced builder can point out potential hazards in the construction process, as well as offer advice on the best ways to use the land based on natural features.
5. Confirm Zoning Laws
It seems obvious, but always make sure that you familiarize yourself with the local zoning laws so that you don’t end up with any unwelcome surprises when you are building additional features on your lot.
6. Prepare for Unforeseen Costs
In a time of prosperity in the Nanaimo real estate market, it’s easy to get overconfident about how much demolishing or building will really cost. Advertised demolition costs are usually just the tip of the iceberg, with additional fees and permits adding up quickly.
Building on vacant land requires costs for soil tests and right-of-way easements among others. Consult your financial plan with a conservative viewpoint, and prepare for potential roadblocks along the way.
7. Consult a Land Planner
In addition to talking with a builder, a land planner can give you valuable insights into the qualities of the land that can result in problems further down the road. Specific vegetation, wetlands, water tables, and access to your lot all require an expert’s eye and will influence what kind of home can be built on the property.
8. Count on a Larger Down Payment
If this is your first time purchasing a lot to build on, then there may be some sticker shock from the differences in getting financing for the project. Down payments on loans for building on a lot range from 25 to 50% and increase based on risks unique to the property.
9. Find a Nanaimo Real Estate Professional You Can Trust
Trusting a real estate professional who is familiar with land for sale on Vancouver Island and the challenges of teardowns and building on vacant lots is essential for feeling confident about your purchase.
Even with so much optimism in the industry, unforeseen costs and other factors can eat away at your investment. One of the best ways to get off on the right foot is to trust that you are getting the best possible price for the land.
Want to pay at market value or below? Find someone who knows the market. Jeff King Real Estate has over ten years of experience in the Nanaimo area, with a specialization in land development and residential sales.
Want to learn more? Get in touch with Jeff to talk about your goals.