Is buying vacant land right for you? While many property purchasers will be looking for their next home or investment property to rent out, investing in unused land can provide a number of benefits if it suits your circumstances. Here are the benefits and key considerations when you’re thinking about buying that empty block.
The advantages in buying vacant land
• Lower purchase prices relative to residential or commercial property.
• Flexibility in what you can do with your land – whether you develop, wait or sell on, it’s up to you.
• Lower maintenance and costs. You won’t need to maintain buildings or pay a property manager unless you choose to develop your land.
• Sight-unseen purchases are possible; investors will often feel more comfortable about buying vacant land without physically seeing the property than they might with developed property.
• Appreciation in value over the long term can be relatively reliable, as the property’s condition is likely to stay relatively stable unless erosion or other conditions affect the property.
So there are plenty of benefits – but what else should you factor into this type of purchase?
Important considerations when buying vacant land
There may not be any buildings or structures on your vacant block, but there may be a handful of factors to consider for your vacant block:
• Conditions of the property before you buy, including zoning restrictions, soil quality, orientation, utility access and bushfire and/or flood ratings.
• Quality fencing may be a good idea if the land tends to get a lot of traffic. A decent fence, either temporary or permanent, can deter people from using the land as a thoroughfare and minimise the risk of injury (or worse) occurring on your property.
• Title insurance for vacant land which covers against a range of property ownership risks. For example, a First Title policy for vacant land could provide cover if it transpires that there’s an encroaching structure built on your land that you didn’t know about; loss caused by errors in certain public property searches carried out when you purchased your land; incorrect boundary lines; and unknown and outstanding rates or taxes that were owed by the previous owner and not adjusted correctly by your conveyancing practitioner.
• Vacant land insurance or public liability insurance, as you as the owner could be held responsible for any injuries or death that occur on your vacant land – even if they haven’t been invited onto the property! It’s worth noting that vacant land insurance is different to vacant property insurance, which provides cover for unoccupied buildings.
Vacant land can be full of promise and potential, as long as you tick off the important factors. If you’re looking into title insurance for vacant land, you can get a quick quote or request cover now.