In our weekly question segment, we answer Jummy’s question which asks us whether or not we should research vacant land prior to purchasing them at tax sale or tax deed auction.
Transcript:
Hey, folks! Casey Denman here with TaxSaleAcademy.com, answering your weekly question. This week’s question is from Jummy, and he says, “Does vacant land also require research?”
Jummy, first off, thanks for your question. A lot of people out there have the common misconception that just because you’re investing in vacant land, it means you don’t have to do a whole lot of research or significantly less research than opposed to a structure of some sort.
Although I wish I could tell you this was the truth, I’d be lying to you. Vacant land does require research and it requires quite a bit of research, to be honest with you.
Now, when we compare that to a structure, whether it’s a commercial building or a house of some sort, there is I guess a little bit less research. Obviously, you don’t need to figure out if the structure is caving in or if it’s burnt down or anything like that, but there is a lot of research when it comes to vacant land.
Some of the research involves things such as size. Are you buying a 5 ft. x 5 ft. little plot of land that’s absolutely valueless? Obviously, there’s not a whole lot you can do with it. Are you buying the easement of somebody else’s property? Again, there’s not a whole lot you can do with it and it’s just a waste of your money.
Is the property even buildable? A lot of cities and a lot of counties have certain guidelines that have to be met. It has to be a certain size before you can even build on it. So obviously, you don’t want to buy a piece of property that’s not buildable because then it’s just a vacant plot of land; forever vacant and valueless.
Also, you need to look at stuffs such as the use of the property. You could find a piece of property and you see a plat map and you say, “Wow! This is a beautiful one acre piece in the middle of all these little lots. It should be valuable, right?” Well, you go out there, you look at it and you realize that the one acre is the drainage retention area for the entire subdivision. So everybody’s runoff runs off to that property, and now they’re trying to auction off at a tax sale auction. And of course, you don’t want to buy that property.
Also, you need to look at stuff such as road access. Is it landlocked? Is it on a road? If it does have road access, is it paved? Is it graveled? There are a lot of things here that can affect the value of the property and it could also affect your opinion on whether you should invest in it or not. So there’s a lot of stuff to research when it comes to vacant land.
Jummy, I hope this has answered your question. If you’d like to follow up, or if anybody else has any questions about tax sale investing, head on over to my website at TaxSaleAcademy.com. And you can do that by clicking the blue link at the bottom of this video. Again, it will take you to TaxSaleAcademy.com. Submit your question and it’s very possible I’ll give you a video response just like this one.
Take care, folks! Bye-bye.