Many new investors buy a vacant land so as to avoid risk, but there are several restrictions and conditions to be followed which remains unaware. As property prices have gone up, buying a vacant property in Vancouver is reconsidered for the affordability factor.
Checklist before buying a vacant property in Vancouver
- Conduct a survey to know whether you can invest on the vacant property or not.
- Get an idea on how neighborhood homes are priced near your property. Do a market research so you get to know how long it will take for the property value to appreciate. Talk to real estate consultants about it.
- Investigate with the neighbors about the location.
- Before buying a vacant land, check the surrounding zoning and environmental conditions of the property. Perform all the legal formalities and also check if the property is new and ensure it has all the permits.
- Visit the vacant property at different hours of the day to know how it looks
- You can avail construction loan in the bank through which you can build a property on the vacant land.
- Enquire about annual tax obligations, whether property is part of any home owner association etc. Check whether the property comes around any natural calamity affected zone.
Benefits of buying a vacant property in Vancouver
- As the cost of the property is very less, you save incredibly on the mortgage; this will help the investors for building a new home or pay the loans faster on the existing home.
- If you find a vacant land in an area that is becoming popular, the investor can earn great profit in the future. To know such areas, take the help of real estate professionals, property finders, real estate agents, property management companies.
- No home inspection is needed, this will save lot of time as you are free from repairs. But land maintenance is required. The municipalities and councils are there to keep an eye on it.
- You need to pay tax for sewage, fees for garbage and other maintenance fee until you construct a property.
- You can build a home according to your preference. You can work on the interiors and other intricacies exclusively. Interior designers and architects can help you out in this regard.
- Investing on an undeveloped property has unlimited potential for e.g. you can use the land for commercial purpose which would get you high profit and rental income.
Drawbacks of buying vacant home
- On the other side, many banks don’t finance for vacant land owing to the risk factors involved.
- No cash flow and no rental income until homes are constructed on the undeveloped land.
- It’s rare to find a vacant land in popular suburbs.
- It has lot of regulations to be followed. It varies in each state according to the government.
The flexibility factor and unlimited potential of a vacant land creates an urge to purchase the property even though it has some rules and regulations.