Perhaps you have found a property for an incredible price and are wondering how anyone could "give" away their land. Well, perhaps it’s because you will need to bring utilities to the land!
If there’s one thing that land developers know, it’s that it’s wise to budget more for developmental costs and fees than for purchasing the land itself.
Depending on the land you purchase, the site development costs can differ drastically.
One cost, in particular, that should never be overlooked is that of bringing utilities to a piece of real estate that has no existing utilities.
Because most people want basic services on their property (power, water, etc.), purchasing land that has no utilities means you’ll need to oversee this development.
Here are the top things that you should know about the process.
1. You can check beforehand if your vacant land has utilities
How do you know if your land has utilities or not?
First off, you’ll need a street address.
Then, you’ll be able to do a search online or make a couple of phone calls.
This is one of the most important steps in your due diligence process because it will help determine how much it is going to cost you to build on the lot.
A few things to keep in mind:
If you’re purchasing rural vacant land, your chances of having public utilities available are not as high as when you’re purchasing land in a more residential area.
If the parcel doesn’t have an address, you can use the county’s GIS maps to figure out the name of the road your lot fronts as well as nearby intersections and addresses.
Please note, you’ll need to know the assessor’s parcel number in order to search for a parcel in the county’s GIS system.
You can use a resource like MapRight to find the boundary coordinates and the assessor’s parcel number for the property.
If you are interested in a Mapright subscription, you can use our referral link.
Once you have the property’s address or assessor’s parcel number and GPS coordinates you can then research whether public utilities are available:
For water and sewer:
You can call the county’s Planning and Zoning Department or the Building Department for information on whether the area is served by the public system.
You can search on Google Maps for "[county name] power."
After you find the name of the company, call and ask if they have power lines on the road in front of your lot.
If they don’t provide services to your potential property, then you can ask whether they know if another company serves the area.
You can also give the county Planning and Zoning Department a call to see if they can tell you the right company to call.
2. "Nearby" is a relative term
You may be told while you are looking at parcels of vacant land that there are "nearby utilities" (even if they are not on the property).
However, "nearby utilities" is a relative term, and you should exercise caution when told this.
For one, it’s incredibly vague.
Nearby doesn’t tell you how far the nearest utility lines are.
You may find them right across the street, or they may be miles away.
You should always make sure you know exactly where utility access is before you purchase.
Just knowing that "utilities are nearby" isn’t good enough when buying land.
It can be incredibly expensive and time-consuming to install – you want to make sure you have the full picture before investing.
3. The cost will depend on your location
This is often the most popular question with any type of investment.
How much will bringing utilities to the land cost me?
Well, the short answer is that it depends.
Utility costs can be anywhere from $10,000 to over $30,000 depending on your location and proximity to public utility connections.
Furthermore, some cities and power companies charge more for their services.
This means that the only way to know how much it will cost you is to get an estimate from your local services or a local contractor (if public utilities aren’t available).
That said, if you’re looking for a ballpark estimate, the following may be helpful.
The local utility company should be able to tell you where the nearest power lines are.
Do not depend on the seller of the property or the agent you’re working with to give you a definite answer (although they may have some knowledge).
Again, be wary of "nearby" as this is all relative.
In most cases, utility companies will charge you for every foot they have to extend a line to your property.
For example, the Tierra Grande subdivision in Valencia County, NM quotes $20,000 for every 1/2 mile.
For this reason, it’s wise to know what "nearby" means.
There is a huge difference in cost between having power lines right next to your property and having them miles away.
If you don’t have an extra few thousand dollars to spend if the power lines end up being farther than expected, then this may not be a project you want to take on.
It’s also wise to know whether or not the lines are on public property or private property.
If the lines are on private property, then you may need to seek permission from whoever owns that property.
The majority of homes in the United States are serviced by a municipal system.
In general, this is the easiest and cheapest way to get your water.
Having said that, even if you do have access to municipal water, it’s not as easy as calling the county and asking them to connect you.
It does take some time and effort to get the water you need since you will be required to install a hookup to the water main (unless this has already been done).
Between all the procedures, permits, and requirements, it could be a few hundred to $5,000 before you get water on your land.
Because, simply put, nothing in life is free.
If you are looking at a property outside of the area serviced by the municipal water system, you will likely be drilling your own well.
And well installation can be expensive.
You may invest anywhere from $2,000 to $25,000, depending on how deep you need to go.
So, it is a good idea to discuss the potential cost of a well with a well installer or general contractor before purchasing a property.
It is also important to note that some states require that you own water rights before you can install a well.
Still, in a worst-case scenario, there are options for getting water without a well.
Sewer or septic tank
Depending on your location, you will either need to connect to a municipal sewer main or install a septic system.
As with public water, when you hook-up your lot to a municipal sewer main, you will need to pay for the connection.
It’s not free!
The alternative, if your property is not served by a public sewer system, is a septic system.
It’s worth noting that the costs of operating an independent septic system are often low compared to the monthly fee you’d pay for a sewer connection.
But that said, the cost of installing a septic system can vary widely.
For more advanced systems, you may pay as much as $20,000.
While a simple, basic tank, you can cost as little as $3,000.
The exact system you will need depends on how well the soil on your land percolates (as measured by a perc test) and local regulations.
For this reason, it’s a good idea to complete a perc test before purchasing land when public sewer isn’t available.
Satellite television, internet, and cell phones are so necessary these days that these services are available in even the most remote areas.
You’ll likely find there is a company available in your area, and they may even be bundling the cost of all three together.
In this case, you may be best off finding out what others in your area are using and find reliable and price effective.
This way, you’re sure to have a service that is affordable and accessible in your given area.
4. Municipal water may not be an option
As mentioned above, municipal water and sewer isn’t an option for every single property.
City and suburban properties are much more likely to have municipal water hookups.
This means that if the thought of installing a septic tank or digging a well just isn’t up your alley, then you may want to avoid those rural parcels of land.
5. You may need approval from your neighbors
You’ve likely heard about easements and done your due diligence to see if you need one for access to the lot.
Well, bringing utilities to vacant land may also require an easement.
Sometimes you need permission from your neighbors to install power poles and lines or other elements in the utility process.
Knowing that someone else could be a barrier to your ability to do what you want with your property may make it difficult
6. Don’t forget to check the quality of your water source
If you choose to install a well, you must check the quality of your water source.
The CDC recommends that all well water be tested regularly, so make this an annual occurrence in the spring.
This is often a good time because you can inspect the well to see whether there are any mechanical problems or other issues that have developed over winter.
Check whether your water tests positive for total coliform bacteria, nitrates, total dissolved solids, and pH levels.
It’s necessary to test regularly as water can be impacted by the soil composition, surrounding land use activities, and overall rain and groundwater quality.
If your water source is determined to be unsafe for any reason, be sure to treat it in a timely manner so that you can continue to use it in a safe manner.
7. Look at all of your options for electricity
Just like municipal water is often the most convenient option, so is connecting the local power company’s grid.
However, while it may be the simplest and most convenient option, it isn’t always the best.
Or the least expensive.
When you look at your specific property, you may discover that the local power grid is not the right option for you.
You may also decide that you need a back-up system if you are in an area prone to blackouts.
Remember to keep the following questions in mind…
Will power lines run overhead or underground? In either scenario, you may need to discuss this with neighbors if lines cross over into their property.
How far will the power company need to run lines to connect my parcel to power? How much will this cost?
Is this area prone to brown or blackouts?
How many transformers will you need?
Will you require a backup generator?
What do local building regulations require? Am I allowed to use off-grid power?
It may also be worth considering whether you should look into alternative power like wind and solar.
Just because a local power company is available doesn’t mean they are the best option for your land.
Do the research before purchasing to ensure you know what will be best when bringing utilities to the vacant land.
8. A septic system requires space
In addition to money, a septic system requires a decent amount of space.
Depending on how much land you purchase, this may be a factor in the decision of whether or not you opt to connect to a local sewer system (if you have the option).
Once you install a septic tank, you won’t be able to build or drive in this area.
It’s also worth noting that almost all land is subject to state and local laws governing the installation and maintenance of septic systems.
This is because failing septic systems are a major source of water pollution.
You want to make sure that your water remains clear of any bacteria infiltrating nearby water supplies and does not impact water supplies for those around you.
If you want to know how much land you need for a septic system, you can check out our post on whether an acre is big enough.
9. Remember, it will take quite a while
Utilities can take more time than you think to install, and you won’t necessarily be in charge of the timeline.
You should expect that your utility connections will take months at the very least.
You’ll need to go through the process of getting permits, which can take weeks and months on their own.
When you’re thinking about the timeline of this process, factor in delays.
By doing this, you’ll avoid disappointment.
You should also look at how different approaches may impact the timeline.
For example, depending on your property, you may have to run underground lines instead of overhead lines.
This will both cost more and take longer.
This means it could be months before you have power on your property.
If you do not have to go this route and can run the lines overhead, you still may need to get permission from your neighbors to add power poles on their property.
Add weeks for this agreement to take place.
Either way, you’ll want to be realistic about how long bringing utilities to a parcel of vacant land can take.
Those who think that adding utilities can be done on their own personal timeline often don’t understand how the process works.
10. Bringing utilities to vacant land can be a major expense
You’ve heard it, you’ve read it, but it never hurts to read it again.
If you don’t have extra time or money (upwards of $30,000) to invest in utilities for your new parcel of land, then this likely isn’t the right lot for you.
And that’s okay!
You don’t have to commit to bringing utilities to vacant land if it’s an expense that won’t be worth it in the end.
However, many vacant landowners have found a perfect parcel of land that just happens to be lacking utilities.
If they’re given the land for free or get an otherwise great deal on it, then investing money in it may be the right move.
You may also just want to use the property for recreational purposes.
It ultimately depends on you and your specific set of circumstances.
11. You’ll have a lot of decisions to make
One of the most important things to know when buying vacant land with no utilities is that it’s not a quick and easy process.
You’ll need to spend all of the normal time doing due diligence and then spend additional time and effort with the property as the utilities are being installed.
You’ll also need to make a lot of decisions, including:
Should you connect to the local sewer system or install a septic system?
Is there municipal water?
Should you dig a well?
How far are the power lines?
Will your neighbors let you put a power pole in their yard?
How can you best utilize your land if you need a well or septic system to be in a certain spot?
What laws do you need to keep in mind?
How will you ensure that you maintain a water testing schedule?
The list of questions goes on!
Ask yourself, "Is this the perfect plot of land?"
"Do I need utilities?"
"Do I have the time and money to invest in a project of this size?"
If the answer is an unequivocal yes, then go for it!
Bringing utilities to vacant land is no small task.
You’ll start the process by doing a lot of due diligence.
At that point, you’ll survey what exactly your property needs.
Are you close enough to a city that you have access to sewage and municipal water?
Or is your vacant land rural enough that you’re looking at a septic system and digging for a well?
Unfortunately, there’s no "one-size-fits-all" solution when it comes to bringing utilities to vacant land.
It requires a lot of time, effort, research, and money.
Yet, if you’re equipped to take it on, it can be what transforms your property from a "great" parcel of land into the "perfect" parcel of land.
Additional Resources If you are looking to buy affordable land
, you can check out our Listings
page. And before you buy land
, make sure you check out Gokce Land Due Diligence Program
. If you are looking to sell land
, visit our page on how to Sell Your Land
Would you like to receive an email with our latest blog/properties every Thursday?
Disclaimer: we are not lawyers, accountants or financial advisors and the information in this article is for informational purposes only. This article is based on our own research and experience and we do our best to keep it accurate and up-to-date, but it may contain errors. Please be sure to consult a legal or financial professional before making any investment decisions.