How to Find Land for Sale (On & Off-Market Land)
Reasons for finding land for sale
If you are looking to build a custom home, finding land to buy is going to be the first step in the process once you’ve determined your vision, budget, and strategy. We also have met with people who have different reasons people for finding land to buy outside of looking to build their dream home. Some look at land as an investment, while others have a larger vision for a dream home they want to build in the future. Whatever your reason is, it’s important to have the right team with you to help you find the right lot, get the right price, and ensure that the lot is buildable and a great investment for the future. At Buildable, we employ a team of experts with decades of experience in land real estate, and we use a unique approach known as Active Search, which offers our customers exclusive access to both on and off-market land. Here are some of the reasons we see people looking to purchase land and our advice to you before you begin your land-buying journey.
Buying land to build a dream home
Buying land and building a custom home can improve your lifestyle tremendously while at the same time being a lucrative investment opportunity. Most, if not all, of the homes that Buildable brings to life, come with built-in equity, which we’ve seen reach as high as 50% in a 2-year period. This is because housing availability is at historically low levels, coupled with the fact that a thoughtful, unique, and new design is generally more desirable than surrounding homes built decades before. Most new homes these days are tract homes, built with lower quality and on small lots. There’s a critical lack of new homes with modern features on the market, which means new construction is in extremely high demand. In a region like San Diego, 99% of new home builds are subdivisions on small lots because developers are trying to maximize profits by fitting as many homes as possible in a given area. Buying land can enable you to find a lot that is exponentially larger than the surrounding homes with all the benefits of new construction.
Buying land as an investment
As Mark Twain has said, “Buy land, they are not making it anymore.” Land purchased for investment purposes has relatively low carrying costs and can appreciate relative to the market. Taxes on land are only about 1-1.25% of assessed value in the San Diego region, so if real estate values are increasing as they’ve done historically, there’s profit potential. Additionally, due to the housing shortage in California and nationally, the demand for land is higher than ever. Even if you choose not to build your dream home, you can also evaluate building a spec home that will have a net profit if you’re willing to go through the process and approach it smartly.
Buying land for a future dream home
Some people choose to purchase land for a future dream home. While this can be a good option for those who are saving up to build the home of their dreams, there are some risks to consider. It’s true that land has huge investment potential, but buying land to just sit on it for an extended period of time could present risks such as city or county code changes and other unknown regulations that could increase the cost of developing a lot. We always recommend that clients immediately start the development process for land upon purchase.
How to find land for sale
Finding land to buy is harder than looking at traditional homes, because it’s a much smaller subset of the market. In San Diego, 3% of real estate transactions are land, which results in larger websites like Zillow and Redfin optimizing their experience for the masses who are looking for existing homes. At Buildable, we’ve done analysis on the SDMLS feed, and of the 115 data points included in each listing, 24 are solely about land, and only 4 make it onto their property detail page. Key details are often omitted on major real estate websites, which makes finding good lots even harder to discern. This is why you need experts by your side to help you find land for sale in San Diego and make sure you get the necessary information so that you can make the best purchase decision.
The following are ways to find land for sale.
Search on the MLS
Many people come to us with questions about where to find lots for sale. The most common place to see lots for sale is the multiple listing service (MLS). Real estate agents use the MLS to post their lots for sale, which creates a database of properties available. In the past, real estate agents functioned as the gatekeepers for these listings and required you to work through them to see available real estate. With platforms like Zillow, Realtor.com, Redfin, Trulia, and others, you can directly access the MLS. However, it can be difficult for inexperienced land buyers to parse out the most important details and information about the listing, so we would still advise that you work with experts to find land to purchase. You may have multiple MLS feeds in your area; for example, San Diego has the SDMLS and CRMLS.
Use various sites when searching for land to ensure you don’t miss an opportunity. When searching, you can filter by “Home Type” to remove the existing homes in the market. Choose the “land” option to see only the results of raw land or vacant lots. Do you have to buy land to build a custom home? Not exactly. You could find an existing home in significant disrepair but on a lovely lot and tear it down to build. The only note is a premium to this, as raw land will always be cheaper than a lot with a home on it. Buildable is adept at this and will be an invaluable partner if that’s your approach.
Use word of mouth
Ask your friends, family, and coworkers if they know anyone with land for sale. This can give you a chance to catch an off-market opportunity. You can also join real estate groups on Facebook and other platforms. Ask if anyone owns lots in your desired locations; just be very cautious. It’s always important to see the land and make sure you’ve done your due diligence prior to purchase. At Buildable, we create a Land Report analyzing 26 different dimensions of a lot to ensure it’s buildable, and not cost-prohibitive to do so. We will go into this in more detail later on in the article.
If you’re wondering about the cost of building a custom home, try using our home cost calculator below.
How to find off-market land for sale
When buying land, you aren’t necessarily limited to what is currently on the market. There are a ton of unlisted and off-market lots out there that are ready for you to purchase if you know the right way to go about it. At Buildable, our team of experts are tapped into the industry, and we back-channel with developers to identify new opportunities that are coming down the pipeline. Additionally, we pioneered a unique approach called Active Search, where we actively engage landowners in order to get our clients exclusive access to off-market properties. The following are a few ways that we use to find land for sale in San Diego that is currently unlisted.
Look for expired listings
Expired listings may be tough to access unless you are a real estate agent. Listings expire due to incorrect pricing, buyers dropping out, or seller dissatisfaction with their agent. Buildable markets to these sellers to bring additional opportunities to our clients.
Contact vacant lot owners
Oftentimes, owners of vacant lots are willing to sell their properties, even if they haven’t officially put them on the market. Buildable helps bring off-market lots to our clients through our proprietary approach called Active Search. There are over 30,000 vacant lots in San Diego County, and at any given time, there are a few hundred on the market. This makes our Active Search an incredibly useful approach to find lots for sale that you would otherwise never come across. Our proprietary process has the potential to find your dream lot while potentially keeping you out of any bidding wars. If you’re going to do this on your own, you can search for the property owners via online tax portals and make public records requests. There are other companies like Property Shark that enable you to get these details, but there is a charge for each request, and the systems are designed for professionals and can be incredibly time-consuming.
Seek out wholesalers
Take caution as this approach is only for experts. Real estate wholesaling is a business strategy in which a wholesaler enters into a contract on a home before eventually selling the contract to a new buyer. The wholesaler acts as an intermediary, selling the property on behalf of the property owner and keeping a set profit based on the sale. These transactions can be risky in that you may have little to no inspection period. It is essential that you have experts with you. Without the proper support, you could make a costly mistake. There are a few companies out there that specialize in this. You can find wholesalers on Facebook groups around “real estate” and “Real estate investing.” But always remember to proceed with caution.
How much does land cost?
Typically, the cost of land should fall between 20% and 30% of the all-in budget of your custom home project. In San Diego, you can find land starting at around $100k and going all the way up to multiple millions of dollars depending on the areas you’re looking in. It’s important to note that a $100k lot can be more expensive than a $500k lot to develop due to the improvements required, so it’s important to have experts with you to evaluate the property. Below, we’ve created a list of the top 10 areas our customers are looking in and the estimated prices for lots in those areas.
As you go through this table, it’s important to keep in mind that purchasing land is more complicated than buying an existing home. This is because land is not priced on a price per-square-foot basis, the way that existing homes are, and it requires a bit of both art and science to arrive at a fair price. It’s critical to understand improvement costs because that should be factored into the lot price. At Buildable, we are land experts and have been able to consistently achieve reductions of the purchase price for our customers because we know the right data to bring into a negotiation. The following are some of the questions we ask ourselves when determining a fair price and negotiating for land.
What has land sold for in the past 6-12 months?
The first thing we will do is look at the land that has sold in that area over the past 6-12 months. We will estimate the typical price by looking at lots with similar size, features, and location. This information will allow us to enter the negotiation with a base of information about the area and a better understanding of the seller’s expectations.
Does this lot have attractive or unique features?
The next thing we will consider when developing an offer on a lot are its features. If the land has desirable features such as a nice view or a substantial build area, that will increase its market value. This means if one lot has a view and the other doesn’t, there will be a premium for the view. Likewise, if the lot has features that are undesirable or have the potential to complicate construction, that will lower the price. It’s also crucial to make sure you’re working with a real estate professional who is a land expert so that they can help you understand the right price, all things considered.
What are the required improvements?
Every lot is different, and the improvements required to make the lot buildable will directly impact the price. Does the lot require excessive grading? Well, then the price should reflect that. Does the lot have power, water, and sewer right at the lot? Well, the location can result in unforeseen costs. You need to do your due diligence here and make sure you’re not signing up to buy a lot that will be prohibitively expensive to develop. That’s the value of working with Buildable. Our team of land experts and builders will be with you every step of the way to make sure you’re paying the right price, and you have a clear plan for developing the land.
What are homes going for in the area?
Once you’ve talked to a builder and outlined what your vision will budget, how would it compare to the other homes in the area? Your result should be in line with the current home prices in the area. In this market, you will likely have tremendous equity by the time you finish due to market appreciation, but that’s not guaranteed, so it’s important to ensure your project pencils out and makes sense.
How to choose the best land to buy
Finding the best land for our clients is always our goal, and we pride ourselves on the fact that our clients have found only the most ideal, straightforward lots since we started our company. In fact, over 50% of the land that is currently on the market is either overpriced or cost prohibitive to build. You need experts versed in building to help you see and identify the best opportunities for you, and that’s where Buildable steps in. The following are tips for how to choose the best land to buy.
The right location
When it comes to your dream home, finding the right lot in the right location is one of the most important parts of the process. Our first step when working with a new client is to have a Build Strategy Session, where we can dig into your vision and help guide you to the right land to meet your needs. There are estate lots with a tremendous amount of land, smaller lots in in-fill communities, and plenty of other options in between. You will know what works for your family best, and Buildable can help you find exactly what you need and even open up your eyes to opportunities that you may not have thought about.
Room for future needs
Part of finding the right lot to support your family is thinking about the future and what you may need in 5, 10, or even 20 years. You may one day want to add a garage, a pool, or a guest house to your custom build, and we will ensure you get a lot that can support all your dreams, present and future. At Buildable, we will dig into your desires for pools, ADUs, workshops, garages, raising animals, and future needs to determine if the lot works for your needs.
Minimal improvements
Every lot requires improvements to get it ready for build, but some require more than others. There could be some very clear improvements required, while others will not be so obvious. Only a team of experts can accurately project how much it will cost to develop a lot. The truth is, in some cases it may be cheaper to develop a $500k lot than a $150k lot. This is where Buildable can step in and help you through the process, to make sure you understand these trade-offs and the impact that they may have. You’ll want to maximize your investment in the home and features as opposed to getting a building site ready. Finding the best lot for your project requires the insights that our expert home-building team can provide.
High-value features
Some desirable land features will influence the future value of the lot, including views, landscaping, and flat areas. There are also other features outside of the land, including proximity to utilities, roads, hydrants, school zones, transportation, and future development that can have a direct impact on the current and future value of your lot. In addition to the investment side of this, some of these features will also have an impact on your day-to-day life once you are living in the home. At Buildable, we help you look at all these dimensions to evaluate what’s best for you, and the value of your home.
The right price
Of course, it’s a given that purchasing a lot at a fair market price is important to the custom home construction process. You want to ensure that not only this is the perfect lot for your home but that it’s a smart investment. At Buildable, we look at the current market, what’s happened over the past years, the required improvements, and other factors to develop a comparative market analysis which will be the backbone of our negotiation. At Buildable, our real estate agents are trained in land evaluation and will fight hard to make sure you get the lot for the right price. You can read our other article to learn more about working with the right realtor to find your custom home.
How much will it cost to build a house on my land?
The cost of construction will be determined by the unique design and the improvements required for the land to support the home. If you would like to learn more about the pricing of home construction, check out this list we’ve compiled of typical cost ranges based on the size of the home.
How Buildable helps you find land to build a custom home
The process of building a custom home can be confusing and overwhelming for most people, especially when you’re going in alone. However, the process can be simple and straightforward when you have the right team by your side who are able to help you approach it correctly from the beginning. If you choose to build your dream home with Buildable, we will be with you every step of the way. Purchasing a lot is not actually the first step, as it’s important to have a clear understanding of your vision before leaping into the process. To get an idea of what this looks like, the following are the first few steps of Buildable’s process to get you your dream home.
Determine your vision
The first step in the process of building a custom home is to determine your vision at a high level. Your vision must be clear, somewhat specific, and include a reasonable budget. This will help you describe what you’re looking for to build partners and align on expectations. Anything is possible when building a custom home. However, you will need to make some decisions about location, size, and amenities which will steer the team in a general direction with consideration of your custom home budget. It is important to devote some time upfront to developing your vision.
Assemble your team
The most critical step in the custom home-building process is assembling the right team of experts. Your team should be made up of people you know you can trust, who will be there to guide you throughout the process of building your custom home. At the very start, you will need a real estate agent and a home builder (A-licensed general engineering contractor) to help you navigate the process and ensure that the land you are looking at is feasible for your vision. Not everyone realizes how crucial it is to have a builder who understands your vision take a look at the land before you buy it. Without that step, you could end up purchasing land that is difficult or very expensive to build on. Worst case, it could impact your entire ability to execute the project. Working with your builder from the very beginning is baked into Buildable’s team design and process, so you know you will get the right support at the right time.
Look at land
As noted above, there are multiple dimensions in which you need to review when finding land for sale. Even a straightforward lot, can have factors that will make it a challenge. We recommend working with a licensed real estate agent who knows land so they can guide you through the process without wasting time and money. At Buildable, we provide you with all the people you need to get the best lot at the best price.
Determine the Feasibility of the Land
After finding land to buy, you will need to evaluate the lot against your vision. Some lots may not be feasible for everything you want to build into your home, so working with an A-licensed contractor, civil engineer, or land consultant to complete these checks is very important. At Buildable, we developed a Land Report that looks at 26 different dimensions of a property to define our strategic approach and limit any surprises you could encounter in development. This step is critical because every lot isn’t necessarily buildable, either as deemed by the municipality or the costs to develop. You need an expert team with you to help you understand the features of the lot and what they mean for your build.
Design Your Home
Once you’ve purchased a lot, you're ready to begin design. At Buildable, we help you find the right designer for the job and negotiate their contracts on your behalf to ensure you get the right price. The most important part of working with Buildable is that we have a builder in all the design reviews to help provide cost guidance, trade-offs, and insights to get you the best home possible for your budget. Our strategy is built on communication and collaboration between all the different experts you need to make your dream home a reality, ensuring that we work as a cohesive team with a singular goal. We truly cannot overstate how useful this managed process is in the creation of our customers’ dream homes.
Obtain permits
At Buildable, we will oversee the entire permit process to ensure things stay on track. It can often be challenging for those not in the construction trades to understand what you need to do during this process to minimize time and headaches. With Buildable, you can have peace of mind knowing that experts will be keeping track of all the fees, deadlines, and revisions.
Build your home
The final step of the process is the actual construction of your dream home. If you choose to work with Buildable, you can rest assured that your project is in the hands of an A&B licensed general contractor who will be building your dream home to your exact specifications. The building process is straightforward but will still require you to make key decisions at various times throughout the journey. Buildable aims to make the process smooth, easy, and adaptable to the level of effort and attention you desire. If you work with us, you can trust that you’re working with experts who have decades of experience and who truly understand and care about your vision.
Build your home in San Diego with Buildable
Building a custom home takes an immense amount of time and effort, but with the right team, the end result will be well worth it. The process can appear overwhelming to those who start the journey alone, however, building your dream home can be simple when you approach the process with experts by your side who can guide you through every step. Buildable specializes in custom home construction, meaning we have the experts on our team that you need to have a stress-free home build, and create the home of your dreams. We have over 40 years of home-building experience within our team, and over 1,000 homes built. Read about our team, talk to us, and get the answers to questions you may have about starting the custom home-building process in San Diego.
