Many of us have heard the stories of challenge from folks who’ve built custom homes. What’s important to appreciate is the majority of those homes were built on spec lots in approved subdivisions on paved streets with utilities at the curb, or build locations with gravel roads that had been “perc’d”. When considering a home build and development on vacant land, the challenges are exponential, as there are no guarantees of access to utilities, or if the land will pass a percolation test allowing a septic drain field. If the land is both accessible and buildable, there are many other regulatory barriers that can and will bring plans to an end.
A friend of a friend story is the person who was very excited by the opportunity to purchase a lakefront lot in a very desirable location. Availability of lake frontage of this caliber is so limited, when a parcel went on the market for a really great price, a person has to act. After the purchase our Buyer eventually discovered that construction on most of the premium area of the lot was not permitted by environmental restrictions, and the rest of the lot was buildable at all. Overnight the value of the lot evaporated and with a lack of due diligence our Buyer had no recourse. The lot became a donation to the lake association, and our Buyer was at least able to eliminate the property tax liability.
The secret to avoiding the pitfalls of aspiring to build on vacant undeveloped land is starting with an attorney. More important than selecting a real estate attorney early in the process is actually following the guidance of your legal counsel from purchase agreement through due diligence to closing.
For Julie and I that is Marjorie M. Dixon and her firm Conlin, McKenney, & Philbrick, P.C., an investment that will save the typical buyer from making costly mistakes.
I believe the second person on the teams should be a civil engineer. This professional will be the technical expertise that will not only conduct the requisite surveys, but also verification of easements, ensuring adequacy of ingress & egress, most importantly the accessibility of utilities or placement of well & septic, and validation of the building site.
The third person eventually added to the team is the architect. The architect may argue they should be ahead of the civil engineer and hold the project lead role. I would suggest this largely depends on your level of involvement, your architect selection, and relationship. While the architectural work is very technical, is has less to do with due diligence, and more to do with creativity and design. Which is exactly why I prefer to work with the civil engineer earlier as their contribution is certainly less creative laying-out sanitary systems, more technical and germane in relationship to the due diligence.
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