There are a number of important considerations when buying vacant land. And many investors who do their due diligence and purchase vacant land simply let it sit for a while and then resell it for a profit. This can work well, but there are some fairly easy, low-cost ways to make it work even better. The key is to know how to raise vacant land value without spending much time or money to do so.
Of course, as with making upgrades and other improvements to raise a home’s value, investors have to be careful to stick with changes that raise land’s value more than the cost of those changes. Below are some ideas for how to raise vacant land value enough to justify the expenditure.
How to Raise Vacant Land Value
- Clear ground clutter – If the property is significantly obscured by overgrown weeds, bushes, and other low-lying foliage, it interferes with potential buyers’ ability to get a good sense of the land and envision how they can use it. It’s well worth the expense to hire a landscape crew to clean things up at ground level to present a more aesthetic, accommodating view of the land.
- Tree trimming and removal – You don’t typically want to clear all the trees from any land. But like ground clutter, too many trees or too much overgrowth similarly obscures the land. Sometimes, tree trimming alone suffices to improve the view considerably. Other times, removal of smaller trees is necessary to make a big difference.
- Clear other clutter – If your vacant lot has trash strewn about, old vehicles or equipment, or other junk, pay to have it hauled off. It makes the land less appealing, and potential buyers see it as an extra expense they’ll have to take on should they decide to buy.
- Demolish old structures – Again, this is another common example of how unsightly land can work against you. Old structures that have to come down obscure potential buyers’ vision for the space, make it appear less desirable, and set off warning bells about added expenses after purchase. Demolish them and have the materials removed.
- Upgrade the driveway – If your vacant land has a dirt road or other unfinished pathway for vehicles, upgrading to gravel or a paved driveway can be a good way to add value. It also makes it more inviting for people to come view the land. But consider the land’s layout and potential uses; if the buyer would likely want to reconfigure the driveway, skip this step.
- Repair or replace the fence or gate – Fences and gates generally make vacant property more appealing. But they are much more effective at this if they’re in good shape. Old ones or ones in a state of disrepair just signal another post-purchase expense and hassle. In many instances, you might also add a quality fence if there isn’t one.
- Consider changing the zoning – If you are certain that buyers will want different zoning for your property, you can save them considerable time and effort by changing it for them. This will greatly boost the appeal of the property, and you can build your cost into the sale price. However, keep in mind that the cost and process involved in this varies widely from place to place. Speak to the local zoning administrator and get their opinion on whether it’s a smart step.
- Obtain entitlements for the property – Entitlements are official approval to develop a lot for a specific purpose. Again, you can save your buyer a great deal of effort if the land comes with the entitlement they want. As with rezoning, the cost and process of acquiring entitlements varies a lot from one place to another, so do some research before diving in.
- Perform a perc test – If you’re interested in how to raise vacant land value for a lot that doesn’t have sewer service, have a perc (percolation) test completed. This is required to determine whether the land can support a septic system. If it can, that’s great; if it can’t, the land isn’t buildable. Buyers who want to develop need this information.
- Run water and electricity – Buildable land also needs potable water and electricity. If your lot doesn’t have one or both, it’s worth the investment to take care of these utilities before selling. It eliminates a considerable inconvenience and expense for any buyer who wants to develop.