What You Need to Know About Buying Texas Land

With its wide-open spaces and diverse landscapes, Texas beckons to those seeking wide-ranging adventures and a chance to own a piece of the American dream. If the allure of wide-open spaces and the freedom of land ownership is calling your name, then buying Texas land might be for you. But before you saddle up and head out to stake your claim, here's what you need to know about buying Texas land.

Getting the green light for financing is crucial. Unlike traditional home loans, financing for land purchases can be trickier. While conventional mortgage loans are readily available for built structures, securing financing for vacant land requires extra preparation.

Research lenders specializing in land loans and understand their requirements. These lenders often have stricter criteria than traditional lenders. Be prepared to offer a larger down payment, typically 20–50% of the purchase price, compared to the usual 3–20% down payment for a house. The justification for a larger down payment is that the land itself doesn't generate income for the lender like a rented house might.

Texas boasts mountains reaching for the sky in El Paso, pristine beaches lining the Gulf Coast, vast deserts shimmering in the West Texas sun, and rolling plains stretching as far as the eye can see. Decide what kind of landscape suits your lifestyle goals. Are you seeking weekend getaways amidst the coolness of the Hill Country, or do you dream of a beachfront property with the sound of waves lapping at your doorstep?

Research the area's zoning regulations to ensure your dream property allows for what you envision. Do you plan to build a home, raise livestock, or simply enjoy the peace of nature? Zoning regulations will dictate what activities are permitted on the land. Knowing these restrictions upfront will save you from disappointment down the road.

Property taxes in Texas vary depending on location and how the land is used. Research tax rates in your desired area and factor them into your budget. Generally, rural land has lower tax rates compared to urban areas. However, taxes can also fluctuate depending on how you use the land. For instance, land used for agriculture typically has lower tax rates than land slated for commercial development. Understanding these nuances can help you estimate your ongoing property tax burden and ensure it aligns with your financial plans.

Owning land comes with additional costs beyond the initial purchase price. Consider fencing to secure the perimeter of your property, especially if you plan on raising livestock or keeping pets. Depending on the location, utilities like electricity, water, and septic systems might need to be installed, adding to the initial investment.

Ongoing maintenance costs like brush clearing and weed control can also be a factor. If your property falls within a homeowners association (HOA), there might be additional HOA fees to consider. Factoring in these hidden costs will ensure you have a realistic understanding of the ongoing financial responsibility of land ownership.

Water rights in Texas are complex and can vary depending on the location and water source. Research water availability on your desired property and any restrictions associated with it. Texas recognizes two main types of water rights: surface water rights and groundwater rights. Surface water rights pertain to water from rivers, streams, and lakes, while groundwater rights govern water extraction from underground aquifers.

Depending on your location and the property's water source, you might need to acquire permits or water rights to access and use water legally. Understanding water rights is crucial, especially if you plan on using water for irrigation, livestock watering, or even a swimming pool. A qualified land professional or attorney can help you navigate the intricacies of water rights in Texas and ensure you have the necessary permissions in place.

Texas law separates surface rights from mineral rights. Purchasing land doesn't necessarily guarantee ownership of mineral rights below the surface. Investigate who owns the mineral rights on your desired property. Mineral rights can include oil, gas, natural resources, and even precious metals.

Severed mineral rights mean a separate entity might own the rights to explore and extract minerals beneath your land. This can come with implications such as the possibility of drilling activity on your property. Knowing who owns the mineral rights upfront will help you understand potential future developments and any limitations they might impose on your land use.

A proper land survey ensures you're buying exactly what you think you are. Hire a licensed surveyor to determine the property's boundaries and identify potential easements or encroachments. An easement is a legal right granted to someone else to use a portion of your land for a specific purpose, such as access to a road or utility lines. Encroachments occur when structures or improvements from a neighboring property extend onto your land. A thorough land survey will unearth these details and ensure everything runs smoothly. The survey will also provide a legal description of the property, which is crucial for registering the land in your name.

Texas zoning laws regulate how land can be used. Research zoning regulations in your desired area to ensure your plans for the property comply with local codes. Zoning codes can dictate allowable uses such as residential, agricultural, commercial, or industrial. They also specify minimum lot sizes, building setbacks, and any restrictions on structures or activities.

Understanding zoning codes upfront will prevent you from purchasing land that doesn't suit your intended purpose. For instance, if you dream of building a cozy cabin for weekend getaways, you would want to avoid purchasing land zoned for commercial development.

Land appraisals in Texas can differ from traditional home appraisals. Unlike houses with standardized features, land value is often determined by location, size, topography, and potential use. Be prepared to present your vision for the land to influence its valuation.

Do you plan on developing the land, using it for agriculture, or simply enjoying it for recreational purposes? Highlighting your plans and potential improvements can positively influence the appraiser's evaluation. A clear understanding of the land's value will help you determine a fair purchase price and negotiate effectively with the seller.

Work with Gaines Slade and his team of Texas land experts for your real estate goals and benefit from his extensive knowledge and experience. As a Texas Land Specialist with Coldwell Banker, Gaines deeply understands whitetail habitats and hunting tactics from his years of producing television shows for the Outdoor Channel. His passion for land and wildlife management, his role in running a successful boutique seed company for duck hunters, and his management of an 11,000+ acre sporting club make him an expert in helping clients become Texas landowners.

Let Gaines Slade guide you in realizing your dreams of owning land in Texas. Search all land and ranches for sale in Texas here.