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The Hard Truths about Building on Your Own Land
November 9, 2020    POSTED IN  FAQHomeWhat to ExpectWhere We Build

When most people close their eyes and daydream about their perfect living situation, their mind drifts to a home perched on a slight hill several hundred feet off the main road on 2-4 acres. Rolling hills with a babbling brook cutting through the back of the tree-lined property, and there is not an HOA in sight! Suddenly, you are jolted back to your front porch in your current neighborhood as you hear the neighbor kid coming home from work with the bass in his car set to level 10 while his mother is yelling at him to “TURN IT DOWN!”. You can practically touch the neighbors from where you are sitting. Something must change with your current living situation! But where do you start?

The very first step: Find that land that you have been dreaming of for years. Land like described above does not come along very often, so if you find it the first step would be to immediately submit an offer that is contingent upon building feasibility. This will allow you time to uncover if the land is build-able, and if you can afford to build on it.

These next steps will be what you’ll need to complete to determine viability of building on that land:

One of the first things that will need to be determined is what ordinances (which is just a fancy word for regulations) the county and/or city has for that location. This is determined by what type of zoning the land is under. Uncovering these regulations is important because it can have an impact on WHAT and where you can build on the land – for example how much road frontage is required to allow a property to be parceled off and build a home on it. The other big item that will need to be researched is if the land is in a flood plain. You can look this up on FEMA.gov. The local planning commission at the city/county office would also be able to help you answer these questions.

Another item to consider would be the size of the land. Some counties have regulations in place that will not allow you to build on or divide land less than a certain amount of acreage. Specifically, we are in Hancock County in Indiana—this county does not allow land to be parceled off in less than 10-acre parcels UNLESS you do what is called a minor sub. Again, you can determine if the area you are attempting to build in has this type of regulation by visiting the local planning commission office or checking out their website. Most pieces of land will come with a warranty deed that will guarantee a clear title to the buyer. This will prove that the land is a legal parcel. You should ask for proof of this when you place an offer on the land; in fact, we HIGHLY recommend this be part of your offer.

The next “hidden” item you will want to uncover is if there are any easements on the land. An easement is a right to cross, or otherwise use, someone else’s land for a specified purpose. There are many types of easements. If the property you are looking to buy has an easement(s), you may not be able to build on that portion of the land. If the easement cuts directly through your land, it could get tricky finding an area to place your home. Depending on the type of easement, they can sometimes be modified or removed—this is a somewhat involved process and can take at least 3 months or longer. To find out if the land you are wanting to purchase has easements, you will need to get a preliminary title search on the land. The schedule B of the title search should show any easements. If you have already purchased your land and are starting to sweat thinking you never asked for any of this information, the title search that was done by the title company should outline any easements on your property—so pull that paperwork back out and take a look.

The final item that you will want to make sure to check is if the land is suitable for a septic system—and if so, what kind. If the land you are wanting to build on is not near any municipal utilities (a fancy way to say public water/sewer hook ups), then you will need to have a well and septic system. These systems take up space and need to have certain conditions to be able to operate. The first step in determining what septic system will be necessary on the land is to determine the approximate location you want your home. You’ll also want to determine any future structures you may want to have (pool, barn, etc.). Once you determine the house and future structure locations, there will need to be a PERC test done. A percolation test is a test to determine the water absorption rate of soil in preparation for the building of a septic drain field or infiltration basin. The results of a percolation test are required to properly design a septic system. A registered Soil Scientist will perform soil borings for the PERC test. Once that test is completed, the design of the septic system can be determined by the local health department. There are several types of septic systems that come with varying price tags. Most septic systems are around the $14,000-20,000 range, with, of course, a few outliers. Along with the PERC test, the health department will take into consideration how many bedrooms (aka—how many people are using the bathroom in your house ), the elevation of the property, and the drainage on the property to determine what type of septic and drain your land will require. In Hancock County, you must also show a secondary septic area in case of future septic failure. This means the minimum a parcel in Hancock that needs a septic can be is one and a half acres to allow room for a current and future septic area.

While doing your due diligence, it’s a good idea to prepare a site cost budget to determine approximately how much all the site costs will total. There are several other items, besides the ones already mentioned, that you’ll want to make sure to have a line item on the budget sheet. A quick rundown: having power run to the home from the road by the local electric company, driveway costs that will mostly be determined by how far back you want to set your home, the potential need for a culvert (which is a fancy term for the pipe that would go near the road, under your driveway to allow for proper movement of water), tree clearing, rough grading, seed and straw for the yard, the well and septic that we mentioned earlier, and the potential need to bring in extra dirt or remove extra dirt from your site.

Once you have decided to go forward with purchasing the land, you should have a plot plan done by a licensed surveyor or engineer. A plot plan tells you several important pieces of information. The plot plan will expose the type of drainage on or near your property. It will also show required setbacks. In land use, a setback is the minimum distance which a building or other structure must be set back from the property line, a street/road, a river/stream, a shore or flood plain, or any other place which is deemed to need protection. In some cases, building ahead of a setback line may be permitted through special approval called a variance, but this is a long process and not normally something you want to count on. The plot plan will also show easements, as we talked about before, and contour lines. These lines show the height above sea level. Typically, each line is about a 2-foot fall. This is super important on deciding what type of home you are going to build on the property. The “fall” on a piece of property could also affect things like where to put your home, if a slab/basement will work, septic location, and drainage.

If you are building on undeveloped land, we suggest being prepared to spend around $30,000-$50,000 in total site costs (everything we have talked about above). These are approximate amounts and every lot is different so those amounts could be more or if you get lucky, maybe less.

Is your head spinning yet?? Don’t worry—we can help you! Once you are in an agreement with us to build your house, we work with you on getting many of these steps completed. We want to make this process as easy as possible.

If the site costs budget number mentioned above scares you, we also have a great selection of already developed home sites. Building on land that is already developed takes the element of surprise out of the equation. Let us know if you’d like to chat more about your land or ours!

Questions about how to get started with all of this? Call LISA or MIKE and they can answer any questions you may have! Or fill out a CUSTOMER WORKSHEET now to get started!!

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