What to Consider When Purchasing or Selling a Property

When a landowner or prospective buyer wants to sell or develop a parcel of land, they may want to consider working with a professional services firm with experience in land planning. This can help prevent surprises or hidden costs down the road.

Was the land inherited and the new owner wants to turn it into a profitable venture? Is the parcel being eyed by a land developer interested in constructing a subdivision? Does the owner want to sell the property outright? Is a prospective buyer wondering what kind of business they can build on the land? There are several questions to ask relating to land use, access to water, sewer and utilities.

Still, other considerations like floodplain proximity, geohazard and drainage concerns need to be taken into account.

For example, many government jurisdictions require developers to provide proof of adequate water, sewer, and access. Here we outline some of the considerations and questions to take into account when purchasing or selling a property.

Land Use

• Does the city/county zoning or land use plans allow for the intended use? If not, what is the process to change it?
• Can the use meet all required codes (setbacks, lot size, frontage, etc.)?
• What and how long is the process to obtain a permit for the intended use?
• Will the use be compatible with the surrounding neighborhood?
• What type of impact fees or other costs will be required for the intended use? Often there are impact fees for schools, fire services, roads, etc. that can add up quickly.
• Are there public incentives for development? Grants, tax abatements, or TIF that could help with financing? 

Water

• Is there a water main next to the site? Is it large enough to serve the site’s intended purpose? Is the pressure adequate? How much is a water tap fee?
• Is there an existing well on site? If not, is a well permit allowable from the State Division of Water Resources? If it does have a well, when was it drilled? Can it produce enough water for the project (the city or county may require additional testing to prove this)? What is the pumping rate? Is the water safe to drink?
• Does the project require a water tank, pump, or fire suppression system to meet fire department requirements?
• Is there irrigation water (and rights) with the property?
• Will building on the site require an extension of a water main from somewhere not adjacent to the property?

Sewer

• Is there a sewer line next to the site? Does it have adequate capacity? Can you connect to it without using a pump? How much is the connection fee?
• Is there a proper sewage disposal (septic) system serving the property? When was the permit for it issued? Can the structure be expanded without modifying the system? When was it last pumped?
• Will building on the site require extension of a sewer main from somewhere not adjacent to the property?

Access

• Is there an existing permit from the city, county, or state highway agency? Does the permit allow for more houses or expansion of the uses?
• Is the access safe (can see both directions clearly a safe distance before using)? Is the access steep, subject to icing? Is the access wide enough to meet city/county standards for the intended use?
• Who maintains the access or road? Is there a maintenance agreement in place? How much are the fees?

Other Utilities

• Are gas, electric, phone, cable, and internet available at the site?
• Is the propane tank accessible and in good condition?
• Can solar or wind energy be incorporated with the existing power utility company?

Drainage/Floodplain/Geohazards

• Does the property lie within a mapped floodplain? Can it be modified to permit the intended uses?
• Are there other drainages cutting through the site that could present a flooding hazard?
• Are the soils good to build on? Are there unstable slopes, rock-fall potential, or avalanche potential that may impact the site?

Other Considerations

• Is there an adequate building site?
• Is there acceptable solar exposure?
• Are there adequate wildfire protection measures in place?
• Are there homeowner’s association dues? What are they?
• Is there potential for gas or other mining activity on the property if the mineral rights are severed?
• Are there reimbursement agreements in place that would make the infrastructure more economically feasible to build? 
• Is the property encumbered by easements or dedications that would preclude it from being developed? 

Deciding on acquiring or selling a parcel of land is just the beginning of an often complicated process. Here we’ve outlined some of the considerations to take into account. Of course, each property is different and the items to consider are as varied as each piece of land. A professional services firm can help raise the important questions, seek answers and provide the best way forward on a potential project.

Considerations for Purchasing or Selling a Property

 

About the Expert

Steve Winters, PE*, is a regional practice center leader dedicated to helping real estate professionals and landowners answer questions they have as well as the ones they don’t have – and move forward with the most sensible option. He has over two decades of experience in planning and land development; highway, utility, and drainage design; construction inspection and administration; and project management.

*Registered professional engineer in AZ, CO