Buying raw land: what due diligence actually looks like
Land has no roof to inspect and no appliances to break. But the due diligence is more complex, not less.
Scenario
Jerome found a 2-acre lot listed for $45,000 in a growing suburban county. It looks perfect for a future home build. There are no structures, so he assumes the due diligence is straightforward. What he doesn't yet know is that the lot is in a flood zone, has no road frontage, isn't connected to public utilities, and the zoning may not permit the use he intends. The land is cheap for a reason.
Critical due diligence items
- Zoning — what is legally permitted on this parcel?
- Survey — exact boundaries, easements, encroachments
- Flood zone status — FEMA flood map check
- Soil test — percolation test if septic is needed
- Utilities — water, sewer, electric, gas available?
- Road access — public or private road frontage?
Permit and approval process
- Building permit required before any construction
- Septic permit if not on public sewer
- Driveway/access permit from county
- Environmental review if near wetlands or streams
- HOA or deed restrictions may further limit use
- Variance may be needed if lot doesn't meet current zoning minimums
Things to consider
- Land financing is harder than home financing — expect 20–50% down and higher rates.
- Cheap land is often cheap for a reason — always find out why before buying.
- What will it cost to bring utilities to the site if they're not already there?
- What is the timeline and cost to get permits approved for your intended use?
- Is there road frontage — or will you need an easement across someone else's property?
BRIK takeaway
Raw land looks simple. The due diligence is anything but. Zoning, utilities, access, soil, flood risk, and permits all determine whether a parcel is actually usable for your purpose — and at what cost. Cheap land with expensive problems is not a deal. Know what you're buying before you commit.