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Taking the first step

 
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I post here in hopes to get a second opinion. I am currently 22 I have no harboring debts, do not pay bills  since living at home with parents , work retail job so finance are too bad (at least 4k in saving). I was looking at this property (https://www.landandfarm.com/property/000_CR_227-10303674/) and wanted to know if it would be a smart investment for a small substantial existence? I can technically pay for it in three years time since I have this structured settlement coming in for 25k. If you could give me some insight on my idea please do give a response.
 
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Victor,

Interest rates being what they are, NOW may be the time to make a move on buying property if you are in a financial position to do so.  You say you have a structured settlement at $25k--is that $25k/year?  If that is the case then I would say that you are in a special position to buy that particular property now if you want.  However, there are a few things you might want to consider.

1)  Meet with a bank NOW.  At 22 you don't have much of a credit history so it will be difficult to get that first loan.  That is part of the hard truth about getting that first loan when you are young.

2)  Are you parent willing to cosign the loan?  This will help you skip step #1

3)  I don't know what the market is like in your area, but you may want to act quickly to get the property before someone else acts on it

4)  Have you considered contacting a realtor?  They know the ins and outs of real estate transitions and are kinda your attorneys here.  Mine was invaluable.  I used her for 3 transactions.

5)  Is the property in a flood zone?

6)  Don't underestimate the costs of ownership.  Taxes come to mind.  So do hidden forms of maintenance.  Get a full legal description and know all easements.

This list can go on forever, but you get the idea.  Owning land at your age could be one of the greatest things you can do for yourself.  Just be prepared for the full responsibility that comes with ownership.  You may wish to consider buying an insurance policy for liability purposes.  Whatever you do, I wish you the best of luck and please keep us updated!

Good luck,

Eric
 
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Victor, welcome to Permies!

Eric has excellent financial advice, that I can't add anything there. My questions would revolve around the land's potential.

I looked at the real estate link you included, and this caught my eye...

Property is in flood zone so it would be just a recreational tract


Perhaps talk to some of the neighbors in the area, to find out more about what you can expect.



 
Eric Hanson
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Victor,

I did not see the part about the flood zone, but if you saw my numbered list, being in a flood zone is a major concern for me.  For my purposes, this would be my single biggest concern.  I would check with local authorities/realtors.  Is this an area that floods regularly?  Occasionally?  Has the potential?  Flood risk is a major turn off on my list of land requirements.  When I purchased my present land, I checked, and it is 105 feet above the local flood basin.  It would take a Noachian level flood for flood waters to reach my house.  I don't know if there are any mitigation steps you can take like bringing in fill dirt, but being in a flood zone is a major personal concern.  Of course, the choice is always yours.  This may affect things like getting a loan and types of insurance you would need.  It is possible that this could be used as a negotiating strategy to bargain down the price, but I do recommend working with a realtor as coming in with too low an offer can appear insulting and the seller just won't listen to any other offers and take their chances with other buyers.  I have seen this happen.

You have a lot to consider here, so feel free to fire away with questions as they may emerge.

Eric
 
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The only thing I can add is to avoid the mind set that this is THE property and you must have it. Keep looking until you put down the deposit.  Oh yes, there is another item .... check mineral rights. If you dont have them with the property, it is not unusual. But do check the various kinds of mining and drilling that has gone on in the area in the last 100 years.  Nothing can ruin your day like a sink hole in the back yard.
 
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I also looked at the real estate link.
0.88 acres? Way to small for building or septic permit in most places.
Flood plain? again no building or septic permit not to mention it floods.
Dirt road easement? How ya gonna get in and out when it rains?
Long a skinny in shape? Stand in the middle and spit, it lands on someone else's property?
12 grand for that??? in their dreams.

I'll pretend for a minute I'm your dad grandad. What the hell's wrong with you boy? Run from that as fast as you can. You got your savings and your other money coming in, be patient, keep saving and keep looking, you can do lots better!
 
John F Dean
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I agree with Mark that you may want to look more.  12 k an acre is not a bargain anywhere that I have lived.  As I commented in my previous post, keep searching up to the point you make a deposit.  
 
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There's lots of property in the world so don't jump at the first one you can afford.  I'd do a private giggle at paying $12K for an un-buildable lot that is too small to hunt on.  Maybe it would be desirable for someone who wants river access but that's the only thing I can see to provide much value.

What are your property goals in life for the next 5-10 years?  If you want to build a little house or garden or raise critters it really directs you towards different kinds of properties.  For instance:

If you just want to live a subsistence living in the woods, maybe an acre is enough.  If you want to grow your own food, two or more open acres would be quite helpful.  If you want to raise animals, 4+ acres would be helpful.  If you want to hunt on your own land, 20 acres is a good start.  If you want to build a house, having proper legal access and not being in a flood plain are critical.  Power/water/utilities could be very important as well.
 
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