by Laura Mueller
You always want to be as protected as possible with any real estate investment that you make. For that reason, it makes sense to look into title insurance when you’re purchasing land. But what is title insurance, and how does it help protect you and your investment? Here’s what you need to know.
What is Title Insurance?
Title insurance is protection against title defects. The title itself is documented proof of ownership and the seller’s right to both possess and sell a particular piece of property. When you buy land, you buy the title, and are from then on the one with those rights.
In a perfect world, all land sales would go smoothly and no seller would mislead a buyer either intentionally or unintentionally. In the real world, however, things happen, and sometimes a title doesn’t turn out to be legitimate. And occasionally, buyers don’t find that out until after the investment has been made and the allegedly legitimate title has been transferred.
Here’s where title insurance comes in. If you have it, you don’t have to worry about losing the investment that you’ve put into a property if it turns out that it was not actually within the seller’s rights to list and sell it. It comes in handy in instances of ownership disputes, as well as in circumstances where the seller had a lien, unpaid taxes, or another property issue that should have prevented them from selling.
Do note that title insurance is different from mortgagee title insurance, which your lender will require you to purchase. Mortgagee title insurance protects your loan provider from title defects, while title insurance protects you.
Cost of Title Insurance
The price of your title insurance will vary depending on who you purchase it from. In general though, expect to spend about 0.5% to 1% of the amount you have agreed to purchase the property for. Even if you’re not keen to add another closing cost to your sale, it’s a small price to pay for the protection that you get. If you’re in a strong market position, you may be able to get the seller to cover the cost of your title insurance (mortgagee title insurance, however, is always the responsibility of the buyer).
Don’t Forget to Do a Title Search
Another key task in protecting yourself against title defects is to perform a title search before closing on the deal. The title insurance company you plan to use should do this for you, but if they don’t, talk to your real estate agent about other ways to have the title search done. This search will reveal whether there are any hidden title defects that you need to know about, and will ensure you get this information prior to making a considerable investment.
So, Title Insurance: Yay or Nay?
It is almost always going to be a good decision to spring for title insurance, whether you end up needing it or not. Even if a comprehensive title search doesn’t turn up anything suspicious, title insurance ensures that you will have nothing to worry about and that your assets are safe. When in doubt, the more protection you have, the better.
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by Laura Mueller
We talk a lot about different types of agriculture, but when it comes to what you should farm on your land, why not consider energy instead of crops?
Solar farming is one of the newer land trends on the horizon. And depending on where you live and the needs of your community, it might be worth looking into as a forward-thinking investment.
Here’s what to know about solar farms, including what they are, how much land you need to build one, and why solar energy might just be the new “cash crop” you’ve been looking for.
What is a Solar Farm?
A solar farm is a large-scale plot of land dedicated solely to collecting energy from the sun.
Also known as solar parks, solar power stations, or solar plants, these big operations serve to take some of the energy load off of traditional power plants, using solar energy instead of fossil fuels to provide sustainable power to the electrical grid.
In appearance, a solar farm looks pretty much how you would expect it to: it’s a large, outdoor area covered in grounded solar panels. By devoting such an expansive space to the collection of solar energy, a solar farm serves to supply a much-needed resource much in the same way that any other type of farm does, with the added benefit that there’s not much day-to-day maintenance required after the initial installation of your panels.
As for who benefits from all this solar power, that depends on your business model. Today’s savvy solar farmers are using their land in a variety of ways, including:
• Powering other land operations, including energy needed for traditional farming endeavors
• Providing supplemental power to communities and/or businesses
• Helping existing utility companies maximize their production capacities
Of course, it’s not as easy as simply setting up some panels and calling it a day. There are specific rules and regulations that need to be followed in starting a solar farm, though the global push toward alternate energy sources means that you might have an easier time than you assume getting a solar farm up and running.
How Much Land Do You Need for a Solar Farm?
As for your land investment itself, you’ll need at least five to eight acres for a productive solar farm that can provide ample community power, and at least 30 to 60 acres for a solar farm with more widespread commercial potential.
How much land you’ll have available to you for this purpose is based on where you live. Some states, such as New York, cap consumer-owned solar farms at just five acres, though many other states are seeing the potential and are working to allow for the accommodation of larger outdoor solar enterprises.
Keep in mind that not all land is suitable for solar farming. You’ll need plenty of unfettered access to sunlight, as well as ample space for additional solar equipment—including inverters. You’ll also need walkable space between your rows of solar panels in case of any repair or maintenance needs.
Is solar farming right for you? If it’s something that you’re considering, you can contact the experts at the Land Broker Co-op. According to David Light, CDO, Land Broker Co-op, “Solar presents many opportunities for land brokers as well. Over $500 million in commissions will be generated from property rights transactions over the next 10 years, the union between RealX and the Land Broker Co-op is the key to this opportunity.”
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by Laura Mueller
The heat of summer is on its way, and with it, some special concerns that you’ll want to be aware of as you maintain (or improve) your vacant land.
Owning a vacant plot doesn’t usually require much work on your end, however it’s still important that you take proper steps to keep it in the best condition possible—especially if you’re planning to eventually develop or sell the property. With that in mind, here are some quick tips on how to care for your vacant land during the summer season.
Do some general landscaping
You don’t need to do a complete land improvement, but you should undertake some basic landscaping tasks to ensure that your land doesn’t get out of control during the warm months, and that it’s less prone to wildfires. This may include trimming your trees and bushes back, mowing the grass, and possibly doing some strategic planting—especially if you’re concerned about boundary lines or potential trespassers.
Take on those weeds
Speaking of landscaping to-dos, practicing routine, preventative weed control each summer is a whole lot easier than dealing with a major weed issue later on. Mowing and cutting will go a long way toward keeping weeds at bay, as will establishing competitive vegetation that slows down or prohibits the growth of weeds in the first place. If you opt for a chemical control method such as herbicides, just be sure to choose a product that won’t harm the surrounding plant life.
Keep pests under control
Vacant land isn’t actually so vacant when you consider how many pests are calling it home. Most bugs and rodents are perfectly safe to have on your land—and many are even quite beneficial—however you’ll want to be aware if your property is experiencing excessive rates of not-so-great pests like mosquitos or wood-boring insects. Bring in a professional if you’re worried, since they’ll be able to source out any pest problems and direct you on your best next steps.
Check for water issues
Summer means rain, and rain could mean serious property damage if you’re not paying attention. Keep an eye out for lingering drainage issues, such as large areas of standing water. Depending on the circumstances, these can lead to soil contamination, or they may speak to other, more extensive issues that you’ll need to take care of.
If you’re planning on making improvements to your vacant land, then summer is a great time to do it. Add in access roads or utility lines, do some of that aforementioned landscaping, and get to work on building any structure(s) that you have in mind. You don’t need to cram everything in to one summer, but the warmer months are certainly worth taking advantage of since you won’t have to be concerned about frozen ground or heavy snowfalls causing delays in your plans.
Just as summer is a great time to improve your vacant land, it’s also a great time to make a vacant land purchase. If you’re thinking of entering the land market or expanding your current portfolio, there’s a good amount of inventory currently available—plus much better weather for touring, surveying, and making sure you get exactly what you’re looking for.
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by Laura Mueller
It can be tough out there for a land buyer, especially when inventory is low.
The real estate industry has been stuck in a stark seller’s market for months on end, and that applies to land as well. This past year saw many people ditching big cities and investing in rural land, a trend that was further intensified by the growing popularity of remote work. And with inventory down but plenty of buyers looking to make a purchase, that can mean a lot more competition than normal for buyers—plus a lot more urgency when you do find something that you like.
If you’re looking to buy and you’re feeling discouraged by the lack of properties for sale, you’re not alone, nor are you totally out of luck. Here are some quick tips for buying land in a seller’s market, with key takeaways that can help you manage the market without losing your mind.
1. Hire a great agent
To really compete in a low-inventory market, you need the right agent. This includes making sure that you’re not only working with an agent who has their fingers on the pulse of your local market and the ability to act fast on your behalf, but who you also communicate well with and can trust to be constantly on the lookout for properties that meet your needs.
If you’ve been on the hunt for a while, it could mean that it’s time for a change. Check in with your agent and ask them how it’s going from their perspective. You may want to consider switching to someone else if it means having an agent by your side who can really go to bat for you.
2. Get in on the search
Having the right agent is essential, but as the buyer you still have an important role to play too. Because inventory is so scarce, you want to have feelers out in as many direction as possible, which includes not just the traditional search channels that your agent is using but also within your own network. Do plenty of your own searching in addition to relying on your agent, and get involved in local social media groups so you can be the first to know when new properties become available.
3. Work out your financing in advance
With fierce competition comes the need to move as quickly as possible when you do find a property that you like. That leaves less time for working out the kinks in your financing. Ensure that you know exactly what you have to spend—including how much cash you have on hand and how you intend to finance the remainder—so that you have all of the information you need to put forward attractive and sound offers.
4. Make it personal
In real estate, buyers and sellers often get reduced to their on-paper presence, which takes the emotion out of the deal. Sometimes a personal connection can work in your favor though, especially when you’re trying to stand out from the pack. Consider writing a note along with your offer that speaks to what drew you to the property and why you love it so much. If it’s a private seller, that may be enough to sway them to your side.
All hope isn’t lost. Your perfect piece of land is out there, so get to work and make sure you snag it.
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by Laura Mueller
Fire isn’t always a bad thing. Some ecosystems—including, possibly, the ecosystem that exists on all or part of your land—greatly benefit from controlled burns. And when performed by a trained team of fire experts, this practice can make a big difference in how healthy, safe, and even prosperous your land is over time.
Also known as prescribed burns, controlled burns are used by both the National Forest Service and individual towns and property owners to optimize land usage and ensure that a piece of land has just the right balance of resources. They may be done annually or just on an as-needed basis, though in either case these types of burns are considered essential to the long-term health of the land.
Think that your property might benefit from a controlled burn? Here’s what to know about what controlled burns can help achieve, plus tips for ensuring that they’re performed as safely as possible.
Benefits of a Controlled Burn
Controlled burns do two big things: they help eliminate the unwanted and they help make room for the wanted.
In practice, this plays out in a number of different ways, including:
• Preventing overcrowding of plants, trees, and roots
• Eliminating invasive, damaged, or non-native plants
• Eliminating certain pests or diseases
• Eliminating hazardous fuel sources that could spark extreme and uncontrolled fires
• Recycling nutrients into the soil for improved future growth
• Improving habitats for certain species, including those that are endangered or threatened
• Promoting the fresh growth of new trees and plants
For these reasons, controlled burns have become a crucial part of forest management, especially in areas where failure to do so could lead to serious consequences like loss of trees and plant life to invasive pests and diseases or the possibility of untamed wildfires.
Tips for Doing a Controlled Burn on Your Property
The use of controlled burns isn’t relegated to national forests and county-owned land. Many private owners rely on controlled burns to keep their properties at their best, though it’s crucial that you do so safely and with care.
Here are some tips to ensure that your controlled burn is a productive one—and that it doesn’t get out of hand.
1. Work with a professional fire team.
Controlled burns can be done by individual property owners in most states (provided you have a permit). But if you’ve never overseen a controlled burn before, then the more expert help you have the better. Call up your local fire department to find out what resources are available.
2. Get the timing right.
The best time to do a controlled burn is in the early spring or late fall. That’s because weather is a key factor in providing the right conditions for a safe and productive fire, including both temperature and wind on the day of the burn and the days following it.
3. Create firebreaks.
Firebreaks are essential, since they prevent the burn from spreading further than you want it to. Most firebreaks consist of a wetted area on the perimeter of the burn, and will still require oversight from a designated extinguisher who can make sure the firebreak is doing its job and respond right away if it’s not.
4. Be thorough in putting the fire out.
When you’re done, check your property carefully to make sure there are no remaining remnants of the fire—a smoldering branch could be all that’s needed to set the area aflame again.
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by Laura Mueller
When purchasing land, many buyers look at the listing price alone when determining whether a specific property is in their budget. However, there are some other major cost factors to keep in mind too—including closing costs.
Closing costs refer to a range of fees used to finalize a real estate transaction. These are additional costs paid on top of the purchase price, and for most buyers, end up adding thousands—or even tens of thousands—of dollars onto the initial spend. For this reason, it’s crucial to factor in closing costs when determining whether a piece of land is in line with what you can afford.
Here are some quick things to know about paying closing costs on land, including what they cover, who pays them, and whether or not you can negotiate them.
Types of land closing costs
There are a variety of different cost factors included in land closing costs. They may vary depending on how you finance your land purchase and who you use to finalize the deal, but ultimately these are the costs you’ll need to consider as you figure out just how much a piece of land might run you.
• Escrow fees – In addition to paying escrow itself, there are also escrow fees, including fees to hold funds and facilitate the transaction.
• Lender fees – If you take out a loan for your land, expect to pay for origination charges, processing fees, credit report fees, and application fees, among other possible related costs.
• Title fees – There are fees for title searches and transfers, as well as for your basic owner’s title insurance policy.
• Transfer taxes – There are taxes involved in transferring land from one owner to another (usually a set percentage of the transfer price), with the specific rate depending on what state you’re buying in.
• Recording fees – These are fees for drafting and recording the land sale in public records.
• Agent and attorney fees – Commission fees for both the buyer and seller’s agent, plus any relevant attorney fees.
• Other third-party fees – Plan on having additional closing costs for paying appraisers, surveyors, inspectors, and anyone else whose services you employ to close out your purchase.
Who pays land closing costs?
In most land sales, it’s the buyer’s responsibility to cover closing costs. That being said, some buyers are able to arrange to split closing costs with the seller—or even have the seller pay for all of them. The better deal you’re offering from the start, the better chance you have of relieving some of the closing cost burden, since a seller may be willing to cover some or all of the costs if it means a shorter closing period or a cash purchase.
Are closing costs for land negotiable?
Everything in real estate is negotiable, and that includes closing costs. Who pays, how much they pay, and when things get paid out are all things that you may be able to negotiate in your favor, though there are never any guarantees.
In order to avoid closing cost sticker shock, work with your real estate agent to calculate what your costs are likely going to be prior to even putting in an offer. From there, you can start working with your agent and the seller’s agent to ensure that you pay the best price and get the best deal—closing costs and all.
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