So, you are looking to buy property. All you have to do is figure out how to not f*ck it up. But seriously,
if you are looking to purchase property for the first time or the 10th time you have do your homework or
what is called the due diligence on the property. Any property purchase that is intended to create a new
home site needs to be analyzed as thoroughly as possible.
After doing property research and due diligence for 23 years for myself as a builder and developer, in
addition to coaching countless others through the process, I realized it would be beneficial to share my
system that anyone can use to help navigate the critical task of researching and analyzing a property prior
to purchasing it.
Quick disclaimer here, this information is not the ultimate list that will cover everything you could ever
possibly need to know but it is a very solid list to work from. I do business in Oregon and each state and
jurisdiction will have its own unique items to research. The resources I review in this article will help
you identify the items that are specific to your area.
In my experience, there are 3 main questions that need to be answered by the property research and
analysis:
Can I build what I want on the lot or piece of property that I am considering purchasing? An example would be: Can I build a 4,000 foot home with a 3 car garage on this lot with the zoning that is in place. Let’s call this question: Can I do what I want?
Are there any site-specific requirements or restrictions that would impact the cost or the ability to build what I am planning? An example of this is: The site has hard rock on it. What will it cost to build what I am planning to build with hard rock on-site? Let’s call this question: What will it cost to do what I want?
Will the cost of the land and the site-specific improvements work within my budget for the project? Let’s call this question: Does it work for me?
To recap our three questions, they are:
- Can I do what I want?
- What will it cost to do what I want?
- Does it work for me?
To answer these 3 questions requires a fair amount of research, so the first step is to utilize as many
resources as you can to gather the information. Examples of the most helpful resources are:
- Realtors
- Title companies
- Architects
- Builders
- Government Agencies (cities, counties, specific departments, etc.)
- Engineers
- Geo Technical Engineers
Now that the resources that can assist you are identified, the next course of business is to gather all the
necessary information. Individual properties can present unique variables, so a broad approach is the best
way to be sure you are covering your bases. To address the broad approach, I created the following list of
items to research as a guide for analyzing the property.
- All zoning information
- Setbacks for all 4 sides of any structure
- Height restrictions & how they are calculated (if applicable)
- Any other zoning restrictions or limitations
- CC&R’s (if applicable)
- Utilities (what is available)
- Storm Water requirements (if applicable)
- Fire Department requirements
- Soil and Geo Technical Considerations
- Liens on the property
- Easements on the property
- Can existing utilities be re-used for the new home
- Existing utility details
- Physical property scan for tanks and buried items
- Environmental overlays and their specific setbacks (if applicable)
If you are interested in more information about property research, I go deeper into all the points from this
article as well as all the additional steps for building a new home in my Construction Flow program. Use
this link to unlock the full version of the Property Purchase and Due Diligence module from my
Construction Flow program along with two other modules covering the Bidding Process and Framing for
your new home. If you are about to begin the process of building a new home this is powerful
information.
I have also created a free master class covering what you need to know for construction projects in 2021.
If you are building or considering building a new home in 2021 you need knowledge now more than
ever. This master class will prepare you for a successful project by understanding how to navigate the
material shortages, labor shortages and other issues that are impacting construction projects in 2021. Use
this link for access to the free master class.