Empty lot for residential or commercial real estate with sold sign.  RAW source image processed with Nikon Capture NX version 1.3 Please see my lightbox below for more views of this and other buildings.

Don't let your dream home turn into a nightmare when buying vacant land. (Getty Images)

Finding your dream home isn’t easy. You'll spend a lot of time to scouring online listings, attending open houses and scoping out neighborhoods – and you may still come up empty-handed.

Maybe your dream home just doesn’t exist yet. In this case, building a home on a vacant piece of land may be the perfect option.

But before you get serious about laying a foundation, be aware that a land purchase may yield more surprises than buying a home – from easements and zoning restrictions to environmental conditions that could easily turn your dream build into a headache the size of a McMansion.

Whether you’re buying vacant land to build a home for your family or you hope to sell the plot for a profit in the future, follow these rules to avoid buyer’s remorse.

Here are the do's and don'ts of buying vacant land:

  • Do work with a pro who knows land.
  • Do consider the value of homes in the neighborhood.
  • Do take utilities and road access into account.
  • Do consider incentives.
  • Don't expect to get a loan.
  • Don't skip the survey or environmental tests.
  • Don't talk to the neighbors.
  • Don't assume you can have property rezoned.

[See: 10 Secrets to Selling Your Home Faster]

Do Work With a Pro Who Knows Land

Working with a real estate agent when you purchase a home helps you navigate the finer details like negotiations, due diligence and closing the deal. But when you’re purchasing land, it's important to hire an agent who has extensive experience negotiating land deals specifically.

A common mistake many land sellers and real estate agents make is to advertise a plot of land as having the potential to be subdivided, says Neville Graham, a Realtor specializing in land sales for real estate brokerage Compass in Beverly Hills, California. Buyers may be left with a plot of land that will yield less profit than expected, while sellers could easily face a lawsuit for false advertising.

“Use an agent who actually has a track record of representing both buyers and sellers for land transactions,” Graham says. “Don’t rely 100% on your agent – ask questions and do your own homework as well.”

Do Consider the Value of Homes in the Neighborhood

One of the biggest draws of building your home is the ability to customize it, but be sure you’re building your dream home in a neighborhood with similar taste.

Graham recalls working with a client who purchased land and designed a home only to be turned down for a construction loan because the cost of the land combined with the cost to build was about $2.2 million, significantly more than home values in the neighborhood, which were closer to $1.5 million.

“If it’s overpriced, then you’re not getting your (construction) loan,” Graham says.

Do Take Utilities and Road Access Into Account

It’s easy to take for granted access to running water, electricity and sewers when you’re buying an existing house, but with vacant land these are not always a given.

“Depending on how developed the area is around the land, you want to know if it’s going to cost money for infrastructure to be run to that land or if it’s already serviced,” says Michelle Farber Ross, real estate broker and managing partner of MMD Realty in Fort Lauderdale, Florida.

Do Consider Incentives

In some situations, especially after a natural disaster, the local government may offer incentives in the form of tax breaks or easy planning approval to rebuild where homes have been destroyed. Cities in California where wildfires have occurred and coastal towns on the East Coast that experience hurricane devastation often want to make sure that badly damaged houses are removed and new structures are built in their place.

Graham notes Malibu, California, has reduced restrictions on building to help restore neighborhoods destroyed in previous fires. “There’s definitely more interest in buying vacant land, especially in the Greater Los Angeles area, because of all the fires, as people are more interested in buying a vacant (property) that has a house on it than raw land,” he says.

But take advantage of those incentives as quickly as possible. Graham notes that city or county ordinances, over time, make it harder to build on vacant land – at least what you had in mind.

“Buy land to build on, not to hold, as city ordinances are being passed more regularly against vacant land, and the chances are high that these ordinances restrict the build-out, thereby devaluing the land that you own,” Graham says.

[See: The Best Apps for House Hunting.]

Don’t Expect to Get a Loan

A land purchase can’t be leveraged with a bank the same way a home purchase can, so you’ll likely have to pay cash if there’s no structure on the property yet.

An investor purchasing an apartment building, for example, “might be able to put down 20% and get 80% from a bank, putting up the land and the building for a mortgage,” says Larry Link, principal broker and president of Level Group in New York City. “But if you have a piece of land, you might be lucky if (a lender) gives you 40% or 50% of the value – and that’s typically if you have a good bank relationship or other collateral. You’re more likely to get zero.”

You'll have a much better chance of being approved for a construction loan on the building you want to put on the land, since the house you'll build serves as collateral on the loan.



Don’t Skip the Survey or Environmental Tests

Similar to a home inspection and background research on a house, a plot of land needs to be subjected to tests and checks to ensure you know what you’re buying and that you’ll be able to build on it.

Environmental tests check the soil for contamination from previous use. The site of a former gas station or auto body shop is more likely to have contaminated soil, for example, and residential homes can’t be built there. The land's potential for flooding or its poor soil conditions for building are also a concern. These reports should also be interpreted by a professional, Graham says – even an experienced real estate agent doesn’t have the technical knowledge to guarantee the results make the land a good investment.

You’ll also want to have a surveyor look at your property to identify the boundaries. Especially if the land is in a neighborhood and has been vacant for years, neighbors may have encroached beyond the property lines, intentionally or not.

“It’s best to buy land that already has a completed survey, geology and soils report,” Graham says. “Should they be outdated, you can always update or redo the reports.”

Don’t Talk to the Neighbors

While speaking to neighbors when you’re looking at a house may be a great idea to get a feel for the area, discussing your plans to build on a vacant lot can easily lead to organized opposition to your future dream home.

Graham says it’s common for neighbors who are used to having raw land near their homes to get upset when the status quo is about change and seek to keep you from building. “All they’re doing is gathering information to use against you,” he says.

Hold off on making friends with the neighbors until any home is built and you’re moved in. Otherwise, discussing plans could lead to a neighbor dispute before you’ve even broken ground.

[See: Types of Roads That Can Have a Big Impact on Home Sales]

Don’t Assume You Can Have Property Rezoned

Your local governing body will have zones, codes and ordinances that limit what can be built on any property or require certain steps to build a sound structure.

For example, there may be required setbacks from the edge of the property, mandates to build a sea wall if you’re on the waterfront, or a percentage of the land may be restricted from development. Getting an exception to the rule isn’t easy, and there’s a good chance it will be denied, Link says.

Rather than trying to rezone property, it’s best to keep your vision within existing limits. Seek land that will allow you to build the home you want, but know your plot’s restrictions before finalizing the plans.

Even if the zoning itself isn’t an issue, proper site plan approvals and permits take time – even years.

“If you’re in a major city, you could easily have three or four years of planning,” Link says.


The 25 Best Places People Are Moving to in 2019

These places have the highest net migration over five years.

A royalty free DSLR action photo of dramatic colors as they emblazon the sky at a resort beach during sunrise/sunset. Cast in silhouette are a ferris wheel, hotel condominiums, beachcombers, and a long seaside dock.

(Getty Images)

When calculating the Best Places to Live, U.S. News factors in each metro area’s growth due to net migration over a five-year period. For the 2019 rankings, we used net migration data from 2013 to 2017 from the U.S. Census Bureau, the most recent complete data set at the time of our calculations. Places with the most growth might be attracting new residents for many reasons, including a hot job market, affordable housing, a desirable location or some other factor. Read on for the 25 metro areas – out of the 125 most populous in the U.S. – that have grown the most over this period.

25. Seattle

25. Seattle

The Smith Tower Observatory is one of the oldest Skyscraper in Seattle

(Getty Images)

Best Places 2019 Rank: 9
Metro Population: 3,735,216
Median Home Price: $442,333
Median Annual Salary: $63,120
Net Migration, 2013 to 2017: 5.58%

Seattle has long had a reputation for its strong job market, with the likes of Microsoft, Starbucks and Amazon headquartered in the area. Also receiving a high score for desirability in the Best Places to Live ranking, Seattle isn’t just bringing people to the area for work – they also want it to be their next hometown.

Learn more about Seattle.

24. Denver

24. Denver

Denver Colorado downtown with City Park

(Getty Images)

Best Places 2019 Rank: 2
Metro Population: 2,798,684
Median Home Price: $393,842
Median Annual Salary: $57,400
Net Migration, 2013 to 2017: 5.67%

Growing 5.67% due to net migration between 2013 and 2017, Denver's population continues to swell at a rapid, although slowing, pace. This population boom is due to both its flourishing job market and high desirability among U.S. residents.

Learn more about Denver.

23. Dallas-Fort Worth

23. Dallas-Fort Worth

Texas town

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Best Places 2019 Rank: 21
Metro Population: 7,104,415
Median Home Price: $248,375
Median Annual Salary: $51,250
Net Migration, 2013 to 2017: 5.7%

The largest metro area on this list, Dallas-Fort Worth grew by 5.7% in a five-year period. The area’s continued growth has contributed to rising home prices, as the median home price is now $248,375, compared to just $210,181 in 2018.

Learn more about Dallas-Fort Worth.

22. Houston

22. Houston

Texas town

(Getty Images)

Best Places 2019 Rank: 30
Metro Population: 6,636,208
Median Home Price: $223,875
Median Annual Salary: $53,820
Net Migration, 2013 to 2017: 5.91%

Houston takes the No. 22 spot on the list, having grown by 5.91% from 2013 to 2017 due to net migration. The large Texas metro area’s growth has slowed compared to the span from 2012 to 2016, when it grew by 6.58%.

Learn more about Houston.

21. Asheville, North Carolina

21. Asheville, North Carolina

Epic Sunset over Downtown Asheville North Carolina NC cityscape with blue ridge mountain range and Mt. Pisgah featured in the background.

(Getty Images)

Best Places 2019 Rank: 16
Metro Population: 445,625
Median Home Price: $248,500
Median Annual Salary: $41,210
Net Migration, 2013 to 2017: 6.16%

A smaller metro area than most places on the list, Asheville earns its spot at No. 21 after growing 6.16% between 2013 and 2017 due to net migration alone.

Learn more about Asheville.

20. Phoenix

20. Phoenix

Phoenix Arizona with its downtown lit by the last rays of sun at the dusk.

(Getty Images)

Best Places 2019 Rank: 26
Metro Population: 4,561,038
Median Home Price: $234,183
Median Annual Salary: $49,500
Net Migration, 2013 to 2017: 6.3%

Phoenix serves as a particularly hot destination for retirees. But the job market and ample outdoor activities continue to attract new residents of all ages. The area has grown by 6.3% over a five-year period.

Learn more about Phoenix.

19. San Antonio

19. San Antonio

SAN ANTONIO, TEXAS, USA - SEP 28: Section of the famous Riverwalk on September 28, 2014 in San Antonio, Texas. A bustling place with many restaurants and bars.

(Getty Images)

Best Places 2019 Rank: 34
Metro Population: 2,377,507
Median Home Price: $211,800
Median Annual Salary: $46,200
Net Migration, 2013 to 2017: 6.6%

The third of four Texas metro areas on the list, San Antonio has experienced significant growth due to net migration: 6.6% between 2013 and 2017.

Learn more about San Antonio.

18. Raleigh and Durham, North Carolina

18. Raleigh and Durham, North Carolina

Durham, North Carolina, USA downtown cityscape.

(Getty Images)

Best Places 2019 Rank: 10
Metro Population: 1,824,266
Median Home Price: $249,294
Median Annual Salary: $53,788
Net Migration, 2013 to 2017: 6.76%

Home to major universities – the University of North Carolina—Chapel Hill, Duke University and North Carolina State University – the Raleigh and Durham metro area has plenty of former students who are choosing to lay down permanent roots, while others are flocking there for the job opportunities the schools and other locally based corporations offer.

Learn more about Raleigh and Durham.

16. Jacksonville, Florida (tie)

16. Jacksonville, Florida (tie)

Sunset at Jacksonville beach

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Best Places 2019 Rank: 42
Metro Population: 1,447,884
Median Home Price: $174,658
Median Annual Salary: $45,760
Net Migration, 2013 to 2017: 6.88%

Sunny Florida weather, a below-average cost of living and a growing business district continue to attract residents of all ages to Jacksonville, which grew by 6.88% due to net migration between 2013 and 2017.

Learn more about Jacksonville.

16. Nashville, Tennessee (tie)

16. Nashville, Tennessee (tie)

Nashville written on a building of the historical district.More images from Nashville in the lightbox:

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Best Places 2019 Rank: 15
Metro Population: 1,830,410
Median Home Price: $248,883
Median Annual Salary: $47,110
Net Migration, 2013 to 2017: 6.88%

With growth numbers like this, aspiring country singers certainly aren’t the only ones moving to Nashville. The largest metro area in Tennessee comes in at No. 16, having grown by 6.88% due to net migration between 2013 and 2017.

Learn more about Nashville.

15. Fayetteville, Arkansas

15. Fayetteville, Arkansas

Houses in a neighborhood in Arkansas

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Best Places 2019 Rank: 4
Metro Population: 514,166
Median Home Price: $177,942
Median Annual Salary: $45,830
Net Migration, 2013 to 2017: 6.94%

Northwest Arkansas’ largest metro area continues to grow rapidly, by 6.94% over a five-year period due to net migration. Fayetteville’s growth is picking up speed as well. In last year’s ranking, Fayetteville saw just 6.44% growth due to net migration from 2012 to 2016.

Learn more about Fayetteville.

14. Charlotte, North Carolina

14. Charlotte, North Carolina

A foggy and colorful sunrise in Charlotte, North Carolina during the morning rush hour traffic.

(Getty Images)

Best Places 2019 Rank: 20
Metro Population: 2,427,024
Median Home Price: $213,983
Median Annual Salary: $50,150
Net Migration, 2013 to 2017: 7.06%

Growing by more than 7% between 2013 and 2017 from people relocating to the area, Charlotte attracts many newcomers due to its role in the banking industry, as it’s home to Bank of America and major offices for Wells Fargo.

Learn more about Charlotte.

13. Las Vegas

13. Las Vegas

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Best Places 2019 Rank: 71
Metro Population: 2,112,436
Median Home Price: $271,767
Median Annual Salary: $44,450
Net Migration, 2013 to 2017: 7.33%

One of the recession’s hardest-hit cities, particularly in the housing market, Las Vegas continues its upward trend with a growing job market and plenty of entertainment options to attract new residents.

Learn more about Las Vegas.

12. Boise, Idaho

12. Boise, Idaho

Boise, Idaho

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Best Places 2019 Rank: 17
Metro Population: 677,346
Median Home Price: $221,475
Median Annual Salary: $43,880
Net Migration, 2013 to 2017: 7.77%

Offering a more laid-back vibe than Las Vegas, Boise comes in at No. 12. Idaho’s capital grew by 7.77% between 2013 and 2017 due to net migration alone.

Learn more about Boise.

11. Tampa, Florida

11. Tampa, Florida

Skyline of Downtown Tampa, Florida, US

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Best Places 2019 Rank: 56
Metro Population: 2,978,209
Median Home Price: $199,717
Median Annual Salary: $46,080
Net Migration, 2013 to 2017: 7.93%

The second of nine Florida metro areas on the list, this Gulf Coast metro area grew by 7.93% between 2013 and 2017 due to net migration.

Learn more about Tampa.

10. Charleston, South Carolina

10. Charleston, South Carolina

Charleston, South Carolina, USA in the French Quarter.

(Getty Images)

Best Places 2019 Rank: 45
Metro Population: 744,195
Median Home Price: $246,408
Median Annual Salary: $44,970
Net Migration, 2013 to 2017: 7.97%

People love visiting Charleston, which is helping the South Carolina city’s tourism industry boom. But plenty of visitors are clearly choosing to stay, as the Charleston metro area grew by 7.97% due to net migration over five years.

Learn more about Charleston.

9. Melbourne, Florida

9. Melbourne, Florida

(Getty Images)

Best Places 2019 Rank: 25
Metro Population: 568,183
Median Home Price: $198,425
Median Annual Salary: $48,240
Net Migration, 2013 to 2017: 8.74%

Growing 8.74% due to net migration between 2013 and 2017, Melbourne sees particular interest from seniors. The metro area’s median age is 47.1 years old, compared to the national median age of 38.1, according to the U.S. Census Bureau.

Learn more about Melbourne.

8. Orlando, Florida

8. Orlando, Florida

Sunset on the Boardwalk - Disneyworld

(Getty Images)

Best Places 2019 Rank: 63
Metro Population: 2,390,859
Median Home Price: $233,050
Median Annual Salary: $44,410
Net Migration, 2013 to 2017: 9.28%

The home of Disney World and Universal Studios doesn’t just attract tourists hoping to see their favorite fictional characters up close. It also brings people who are planning to make this warm-weather destination their home.

Learn more about Orlando.

7. Lakeland, Florida

7. Lakeland, Florida

A walking bridge on Lake Parker, Lakeland, Florida, and an eastern cedar tree

(Getty Images)

Best Places 2019 Rank: 59
Metro Population: 652,256
Median Home Price: $171,967
Median Annual Salary: $40,560
Net Migration, 2013 to 2017: 9.91%

Located in the center of Florida’s peninsula, Lakeland is showing strong growth that mirrors the state’s coastal metro areas featured on the list. Lakeland grew by 9.91% from 2013 to 2017 due to net migration alone.

Learn more about Lakeland.

6. Austin, Texas

6. Austin, Texas

Austin, Texas, USA downtown skyline over the Colorado River.

(Getty Images)

Best Places 2019 Rank: 1
Metro Population: 2,000,590
Median Home Price: $292,500
Median Annual Salary: $51,840
Net Migration, 2013 to 2017: 10.09%

Following the Great Recession, an increasing number of tech companies have been opening offices in this Texas metro area. Its affordability relative to the likes of spendy California metro areas such as San Jose and San Francisco is driving many people to Austin for work. It’s a hot enough destination that the metro area grew by 10.09% over five years due to net migration.

Learn more about Austin.

5. Port St. Lucie, Florida

5. Port St. Lucie, Florida

Aerial drone image of Port St Lucie Florida USA

(Getty Images)

Best Places 2019 Rank: 78
Metro Population: 454,482
Median Home Price: $211,083
Median Annual Salary: $42,500
Net Migration, 2013 to 2017: 10.24%

Located along the Treasure Coast, Port St. Lucie attracts people looking for a place with plenty of waterways to explore and, of course, the warm Florida weather. The Port St. Lucie area grew by 10.24% during a five-year period.

Learn more about Port St. Lucie.

4. Daytona Beach, Florida

4. Daytona Beach, Florida

Daytona Beach skyline aerial view.

(Getty Images)

Best Places 2019 Rank: 99
Metro Population: 623,675
Median Home Price: $192,817
Median Annual Salary: $38,710
Net Migration, 2013 to 2017: 10.35%

Daytona Beach’s growth from net migration between 2013 and 2017 nearly hit 10.5%. The coastal metro area attracts plenty of tourists to NASCAR races and local beaches, but many of these visitors also appear happy enough to make the place their next hometown.

Learn more about Daytona Beach.

3. Sarasota, Florida

3. Sarasota, Florida

Drone of siesta key beach

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Best Places 2019 Rank: 18
Metro Population: 768,381
Median Home Price: $237,260
Median Annual Salary: $42,680
Net Migration, 2013 to 2017: 13.1%

With a median age of more than 51 years, Sarasota is a particularly attractive destination for retirees, even more so than other Florida locales. Sarasota grew by a whopping 13.1% in a five-year period due to net migration.

Learn more about Sarasota.

2. Fort Myers, Florida

2. Fort Myers, Florida

Fort Myers Beach pier, Florida, USA.

(Getty Images)

Best Places 2019 Rank: 35
Metro Population: 700,165
Median Home Price: $219,200
Median Annual Salary: $41,380
Net Migration, 2013 to 2017: 14.42%

Fort Myers ranks No. 2 on the Best Places People Are Moving list for the second straight year. Fort Myers grew by 14.42% over a five-year period due to net migration.

Learn more about Fort Myers.

1. Myrtle Beach, South Carolina

1. Myrtle Beach, South Carolina

Myrtle Beach South Carolina aerial view at sunset

(Getty Images)

Best Places 2019 Rank: 75
Metro Population: 432,772
Median Home Price: $181,800
Median Annual Salary: $35,890
Net Migration, 2013 to 2017: 17.41%

Myrtle Beach may be small, but it’s proving popular among people looking for a new place to live. Like many of the Florida metro areas on the list, this coastal South Carolina spot attracts plenty of retirees looking for warm weather year-round, lending to the metro’s median age of 46.5 years.

Learn more about Myrtle Beach.

The best places to live in the U.S. based on net migration:

The best places to live in the U.S. based on net migration:

USA, Florida, Stuart, Aerial view of suburbs

(Getty Images)

  • Myrtle Beach, South Carolina
  • Fort Myers, Florida
  • Sarasota, Florida
  • Daytona Beach, Florida
  • Port St. Lucie, Florida
  • Austin, Texas
  • Lakeland, FLorida
  • Orlando, Florida
  • Melbourne, Florida
  • Charleston, South Carolina
  • Tampa, Florida
  • Boise, Idaho
  • Las Vegas, Nevada
  • Charlotte, North Carolina
  • Fayetteville, Arkansas
  • Nashville, Tennessee
  • Jacksonville, Florida
  • Raleigh and Durham, North Carolina
  • San Antonio, Texas
  • Phoenix
  • Asheville, North Carolina
  • Houston
  • Dallas-Fort Worth
  • Denver
  • Seattle

Read More

Updated on Oct. 18, 2019: This story was published at an earlier date and has been updated with new information.

Tags: real estate, housing market, home prices, new home sales, pending home sales, architecture


Devon Thorsby is the Real Estate editor at U.S. News & World Report, where she writes consumer-focused articles about the homebuying and selling process, home improvement, tenant rights and the state of the housing market.

She has appeared in media interviews across the U.S. including National Public Radio, WTOP (Washington, D.C.) and KOH (Reno, Nevada) and various print publications, as well as having served on panels discussing real estate development, city planning policy and homebuilding.

Previously, she served as a researcher of commercial real estate transactions and information, and is currently a member of the National Association of Real Estate Editors. Thorsby studied Political Science at the University of Michigan, where she also served as a news reporter and editor for the student newspaper The Michigan Daily. Follow her on Twitter or write to her at dthorsby@usnews.com.

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