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“Mongo”, above, lists some great points. I bought a wooded lot last summer in the mountains of Eastern, Arizona (Town of Alpine, elevation 8200). I spent over a year looking in the few of the developments there for a lot. First of all, don’t fall in love with one particular lot. Keep your options open. Look at what you might at first consider “dog” lots as well. In an area of $30,000 half-acre wooded lots, I bought one at a substantial discount ($22,000). The lot that I had purchased was on the market for over a year, and I believe it was passed up due to the fact that it backed up to a major roadway in the area. I passed up on even getting out of my car and looking at it because I immediately classified it as a “dog” lot. Well, I eventually got around to walking the lot and realized that it had potential. The owner was asking $25,900 (a low price when compared to others in the area) but I knew that it had been on the market for a while. I decided to make an offer of $18,000 just to see what would happen. We finally settled at $22,000 although I really think I could have had it for $20,000. Anyway, I got the lot for about $8,000 less than comps and have recently started to build on it. After having the site cleared for the home, I have already had several people (my builder being one of them!) telling me what a great lot I have! The lot was originally heavily overgrown with Pine, Spruce and brush oak which also detracted from the original curb appeal. After spending time on the lot, I have also realized that the lot is far enough back from the main road that it is not an issue! So, my advice to you is keep your options open and dont fall in love with one particular lot!
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Hello I am here again looking for some good insight. What in-side secrets do you use to get you moneys worth when buying a lot. I am looking at a wooded lot in an excellent neighborhood in NJ. Zoned for both residential and commercial. The lot is 209 by 209 feet. Asking for 47000. I want to get the price down. what would you do if you wanted the lot.
Thanks From The Harv
*Hi there,Rent an adjacent property, install a old trailer/building shack, put up a sign that you have made an application for a toxic waste storage facility and wait before making your offer on the property of your dreams.Always creative,Gabe
*Make an offer they can't refuse.
*I think there are two things that determine the price of something;1. how bad do you want it?2. how bad does the owner want to sell it? - yb
**How long on the market?*Is it being shown often?*Has the price been dropped by the seller?*Has anyone made other offers that have been accepted or rejected?*Is the local market hot? Cold? Stable?*What have adjacent lots sold for?*Zoning...what can they build next door if it is commercial?*Decent perc test, if required?*Any obvious building pproblems (ledge/clay/swamp)?*How bad do they want to sell it?*How bad do you want to own it?*How bad does your wife want to own it?*Is the lot unique, one of a kind? Or, if you lose it to someone else will you be able to find something comparable elsewhere?*Any easements/right-of-ways, etc, that effect the value?*Proximity to schools, fire dept, hospital, other services?*Can your proposed house fit on the lot, with proper space/setbacks for driveway, gardens, etc?*Solar orientation?*Quality and style of neighbor's houses?*Quality of neighbors?*Check in with the local Police dept, any trouble in the area?Find out these answers and adjust your offer accordingly. When making an offer, don't flinch.
*Just wanted to say thank you. good ideals!
*:)
*If purchase price is really important, cast a wide net, be willing to walk away from the "perfect" lot, accept a lot that is good enough, make low offers on many parcels. You may get no interest from 19 out of 20 sellers but you only need one who is desperate enough or in a slow enough market. Mike: "Make an offer they can't refuse" Because Harv is in NJ? Why does NJ have the most toxic waste sites and California the most lawyers? NJ got to choose first.
*"Mongo", above, lists some great points. I bought a wooded lot last summer in the mountains of Eastern, Arizona (Town of Alpine, elevation 8200). I spent over a year looking in the few of the developments there for a lot. First of all, don't fall in love with one particular lot. Keep your options open. Look at what you might at first consider "dog" lots as well. In an area of $30,000 half-acre wooded lots, I bought one at a substantial discount ($22,000). The lot that I had purchased was on the market for over a year, and I believe it was passed up due to the fact that it backed up to a major roadway in the area. I passed up on even getting out of my car and looking at it because I immediately classified it as a "dog" lot. Well, I eventually got around to walking the lot and realized that it had potential. The owner was asking $25,900 (a low price when compared to others in the area) but I knew that it had been on the market for a while. I decided to make an offer of $18,000 just to see what would happen. We finally settled at $22,000 although I really think I could have had it for $20,000. Anyway, I got the lot for about $8,000 less than comps and have recently started to build on it. After having the site cleared for the home, I have already had several people (my builder being one of them!) telling me what a great lot I have! The lot was originally heavily overgrown with Pine, Spruce and brush oak which also detracted from the original curb appeal. After spending time on the lot, I have also realized that the lot is far enough back from the main road that it is not an issue! So, my advice to you is keep your options open and dont fall in love with one particular lot!
*HarvatorsMy partner and I have purchased a number of lots in the past 6 years. The market where I live is has been very hot for that entire time.When we were buying our first lot we made offers on two lots before buying one. On the first two lots there were already other offers. They both sold for full price. We bought a steep lot that had terrible soil and underground water. The lot is 1 mile from a huge ski area. Our offer was contingent on a soils test. The soils engineer told us not to buy it. We bought and then flipped it a year latter. The selling price was more than double what we paid. Last year the lot was for sale again but for four times what we originally paid.The first spec house we did is located on a fairly steep uphill site. The driveway is ten percent. We made an offer on the lot next door which was less steep(before purchasing ours). The same day the seller got a full price offer and accepted it. If we had known the market better we would have been able to buy the less steep lot and save considerably in building cost.Now when I look at land I try to buy downhill lots. They cost less to build on than uphill lots. If a I find a lot that I want I talk with people who have built before in the area about the soils. If everything looks okay I make an offer with no contingencies. For earnest money I use the most money I can afford to lose in the event that for some unforeseen reason I can't close. The offer I make expires in 3-4 days. Most of the lots we have purchased have been in the MLS. I take my offer directly to the listing agent. If the sale goes through the listing realator earns twice as much as if anothe realator is brought in. The listing realator may push the offer to the seller. I also always make the contract assignable.
*I have to agreewith Mongo's list. I would rather see an approved septic design if at all possible, as the type of system required may have a large impact on your budget. If the lot is on public sewer, what are your connection charges? Water supply, consider well costs or water share/ connection fees. I would also inquire with the local building dept in regards to impact fees, (schools, roads, metro) and estimated permitting costs. In our area, Seattle, these can add up to $8-10K real quickly.
*All good points, to which I'd add: How do you get your money out if you need to? What will it be worth to someone else (ideally a lot of someone elses) if a year from now you need to sell your dream lot? You need to look at the value of residential lots if you've improved it as a residence. Someone won't pay a premium for a commercially zoned lot with a house on it if they can by a residentially zoned lot/house cheaper. Or if they want it for commercial use will they need to deduct the cost of tearing down the residence and will the income potential from the commercial use be enough to write off the cost of the demo of a brand new house?If you want to use it commercially, what is the income potential to another commercial buyer. You back into land value from the income potential.If you're paying cash these are judgments you need to make. If you're getting a mortgage your bank will only lend you x% (maybe 70-80) of APPRAISED value, not what you're willing to pay, so the bank will make some of the judgments for you. Typically you'll have to pay for the appraisal.