Mar 20, 2023
You hit the jackpot and found a home with everything you want. And bonus—it backs up to vacant land!
A little more privacy is very inviting, but you might want to pump the brakes before making an offer. While buying a house next to vacant land seems like a good thing at first blush, think about this: What if, years from now, someone decides to build a monstrous 24/7 storage unit or a gas station there?
That’s right. You lose your private oasis, and it could also impact your resale value.
“As a buyer, you definitely want to consider what may happen in the future in that location,” says Tiffany Szakal, agent and managing broker at The Local Element in Grand Rapids, MI.
And while you can’t gaze into a crystal ball to foresee whether vacant land will remain empty, these tips can help you anticipate what might happen to the undeveloped lot next door.
Do your homework
Your first task is to research what could happen to vacant land near a home.
“Check on zoning regulations in the specific area you’re interested in to see what is permissible on that property,” says Brian Hanley, an agent with EXIT Realty Premier in Massapequa, NY. “If it is an entirely residential area, it may not be an issue or cause of concern to the buyer.”
Sure, a new house could be built next door, but that might not be so bad.
You could also encounter a vacant property that backs to a conservation easement. Unlike some easements, a conservation easement is favorable, because it may allow limited residential use or agricultural activities but prohibit commercial development.
“While not an absolute sure thing, it is very unlikely anyone will be building there anytime soon,” says Jake Northrop, an agent at Northrop Realty in Clarksville, MD.
What if the land is zoned mixed use or commercial?
If the land is not zoned solely as residential, it could be designated for either mixed-use or commercial development.
Land in a mixed-use zone could be developed as a planned community, with a combination of residential housing, office, retail, medical, and recreational spaces.
But if the land is marked as commercial, you might not know what you’re in for. You could end up living next to a service station or shopping center.
So check with the town’s planning department to see if any development proposals are being discussed or are already on the books.
“Some red flags include whether a property backs in farmland,” says Northrop, explaining that developers often look for that setup. “And look for any local infrastructure development in the coming years, within a two- to three-mile radius of the home.”
Also, see if the property hits a road, which means it could be a target for road-widening projects.
Consider lifestyle and resale value
Privacy and distance from neighbors, versus the possibility of nearby commercial development, might rank high when considering whether to buy. But it’s just part of the equation when it comes to purchasing land near a vacant lot.
To help determine your comfort level, ask yourself how future scenarios could play out and impact your desired lifestyle. Maybe you wouldn’t mind living next to a cafe or having a new neighbor build a home. But you would very likely mind living beside a busy convenience store.
Another thing to consider is whether you plan to sell the home in the future.
“I typically let buyers know that, when purchasing in an undeveloped area, whatever’s developed may not affect them while they live there; but it could damage the resale of the home down the road,” says Northrop.
You might enjoy having fine dining and cute shops nearby, but others won’t necessarily appreciate a noisy restaurant that stays open late and generates traffic.
Buy the vacant land
If you want to keep the land next to you undeveloped or increase your property size and value, you might consider buying the vacant land.
“I’ve actually seen this in the past,” says Hanley. “A buyer was purchasing a beautiful waterfront home that had everything on their checklist except a pool. Coincidentally, there was a small piece of land owned by another party directly next door that was vacant and able to be purchased.”
The land was just big enough to install an in-ground pool, so the buyer snapped it up.
The deciding factor
Buying a property adjacent to vacant land will always come with a question mark.
“Unless a buyer sifts through the vacant land’s title records downtown and finds a restriction on future builds, there is always the possibility of it being developed,” says Szakal.
If buying the neighboring vacant land isn’t an option, you have to ask yourself if you can live with the uncertainty in the long term.
Conversely, development on the vacant property might be a good thing. A recreational park could be a home run for families, or the convenience of a cozy coffee shop within a new, walkable community might be especially enticing for others.
It all depends on whether a buyer is comfortable with the varying degrees of unpredictability that come with a vacant lot.