Real estate investing comes in many forms. You can flip houses, you can buy and manage rental properties, you can even invest in commercial businesses. But if you’ve ever thought about building something, literally, from the ground up, then keep reading. In this post, we walk you through the 6 basic steps of buying, developing, and profiting from vacant land in Arizona.
1) Find the Land
The first step in the process of buying, developing, and profiting from vacant land in Arizona is to find the land! There are a handful of ways to find vacant land to buy. First of all, you can call us at 480-442-7787 and we can help you find what you are looking for in the Southwest. You can work with a Realtor who has access to the multiple listing service, or MLS. You can also find properties for sale by owner on public posting boards online. There are also public auctions held by cities and counties that frequently offer vacant land for sale, mostly due to unpaid taxes. Working with a real estate professional might be ideal if you are new to buying vacant land as they know the tips and tricks of the trade.
Look into the current and future zoning of the vacant land, will the municipality’s plans interfere with your own? Will you be able to request an exception? Are there any deed or usage restrictions or building requirements? Review the physical characteristics of the property, will it be large enough for your plans? Is there an excessive amount of clearing that needs to be done? Is it on a canal? Does it have direct access to tap into the utility system? Are there plans for utility expansion? Check into the plat maps and any surveys available to make sure there are not any surprise easements you are unaware of.
You’ve found the vacant land you want to buy. The next step in the process of buying, developing and profiting from vacant land in Arizona is the purchase. This is when you’ll negotiate an offer and fund the closing. How are you going to do that? Do you plan to pay cash, or do you need a loan? It is a lot more difficult to buy vacant land with a loan from a bank than it is to buy a building, residential or commercial. There are only a handful of banks that will loan on raw land, and they usually require a much larger down payment. One way to work around this is with Owner Financing. Basically, you can make a downpayment to the seller then pay off the balance in monthly installments. We offer this on most of our land and are happy to work with clients to help them secure their dream property. Another option would be to form a partnership to invest in vacant land, and you may form an agreement to pool your funds to buy a larger portfolio of land with larger returns.
The next step in the process of buying, developing and profiting from vacant land in Arizona is to plan. Decide what you are going to do with the vacant land based on the current zoning. If you want to do something different than the current zoning will allow, you’ll need to apply to change the zoning. Will you build a single-family house or a multi-family building? If its commercial, will you build a single business building, or maybe it’s enough land to build a plaza. No matter what you have in mind, make sure you start with a solid plan.
Once you’ve closed on the land and perfected your plan, the next step to start profiting from vacant land in Arizona is to develop it. Find a builder that has a good track record and valid references to build your project. Make sure to keep tabs on their progress to verify they are building to your specifications and options.
6) Rent or Sell
The last step in the process of buying, developing and profiting from vacant land in Arizona is to rent or sell your development. If you’re planning to set this up as a long-term investment gaining regular payments over time, then clearly you’ve chosen to make this a rental project. But keep in mind, that doing so does come with additional landlord duties. Just make sure you are aware of your responsibilities. Or, if you do not want to be a landlord, then selling your new development is the way to go. With the right development, your profit margin will be more than if you just bought and resold a piece of vacant land.