How To Own Land Without Breaking The Bank

Most people believe land ownership is out of reach, so we make it that way. I know I did. Despite wanting my own little piece of the earth to hunt, plant trees on, and just enjoy any way I pleased, I never thought it would happen.

Then a buddy of mine bought 80 acres in northern Wisconsin. His land, at least at first, wasn’t overly appealing. Other than a sliver of high ground and an agricultural field, it was mostly swamp. The first few years he owned it, I helped him cut shooting lanes for rifle season, clear some brush and plant dozens of apple trees. Where he’d seen possibilities earlier, I’d seen nearly useless land. It didn’t take long to realize he was right, and I wasn’t.

That revelation got me thinking about buying my own place, but I knew the parcel would have to be small; otherwise, it would be financially impossible.

After a few months of looking in the general area around my buddy’s land, I saw a listing for 28 acres priced at $35,000. Apparently desperate, the owner quickly dropped the price to only $15,000.

At the time, my wife was pregnant, and I wasn’t in a great position to buy recreational land. However, I drove the two hours into Wisconsin to walk it.

The front half of the property left much to be desired, but the back half consisted of rolling hills and a beautiful deciduous forest. I made an offer that evening, and the following morning, I went to the bank for a personal loan.

I’ll admit, even though it was a relatively inexpensive property, I wasn’t excited about taking on any extra debt. After I did, however, I realized that within a very short time, I’d own it outright, and that changed my whole perspective.

Since then, I’ve come across a 29-acre property close to my home in the Twin Cities that a good friend and I bought together, and I’ve bought a 30-acre parcel in Wisconsin close to my original purchase. The most I’ve spent for any parcel was $27,000.

The biggest obstacle

the biggest obstacle

When people ask me how I paid for the land I now own, most of them are shocked to hear how cheap less-desirable ground can be. This is because most of us don’t seriously consider buying recreational land, so we’re unfamiliar with the market. Of the folks who do check out the real-estate scene, most look for properties that have what they want in a dream parcel, which puts things out of reach.

The key to finding your own piece of ground is not only knowing what you can afford, but also understanding that your options will be limited. That’s the way it is, but as my friend showed me 10 years ago, you’ve got to look at property with optimistic eyes. Look at it for what it can be after you’ve put some work into it, not what it is now.

In fact, when I shop for land, I look for ground that others probably don’t want. Every property I’ve bought has some wetland on it. For me, each low spot represents a place where deer, bears, ducks, grouse, and other critters call home. Wetland is also far cheaper than high ground, so it can balance out the parcel’s overall per-acre price.

Once you’ve decided your price range and understand how much sweat equity you must invest, you’ll be ready to start shopping.

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Research, research and research some more

I’m not knocking realtors in general, but it sure seems like many of them put very little effort into land listings. This is especially true regarding smaller parcels. Many of the listings I review feature a very short description along with a few pictures taken from the nearest road.

If you find a property for sale that interests you, your best bet is to get the address and check it out on Google Earth before committing to walk it. Lowland, highland, trails, roads, and clearings are all visible in aerial photos. You’ll be able to decide if it’s worth walking by simply checking it out from a bird’s perspective.

It seems that land in my price range is always just far enough from home that I tend to find several properties worth walking, then make a day of it. At this step, it pays to be cautious about jumping into anything but also to understand that you’re not likely to find your dream property. Always keep an open mind.

I tend to look for places to maybe build a cabin someday, areas conducive to food plots for deer, and other areas where I can plant plenty of fruit trees for both the wildlife and my family.

Distant lands

distant lands

Most of us search for acreage close to home, but that might also mean prices that are out of reach. This is certainly the case where I live now, so I tend to look within a few hours of home in areas with fewer people. I’ve found that if I can keep the drive under three hours, it’s worth it to own a parcel because I can easily make a weekend trip to spend time there.

Think about how far you’re willing to travel to reach your potential paradise, and then cater your search accordingly. Keep in mind that there might be more to your chosen area than just cheap land, which can help with the travel. For example, where two of my properties are in northern Wisconsin, there is abundant public land for hunting and many fishable lakes and rivers.

Found One, Now What?

If you’ve found a property you like, ask yourself plenty of questions before making an offer. You’ll want to know if putting up a building or creating a driveway is feasible and what it will take to start that process. You’ll also want to know what the taxes are per year, what you can and can’t do with a wetland, and dozens of other things. Approach this stage with a plan in mind.

Provided you get the answers you’re looking for, you’ll need financing. In our country, where we’re addicted to debt, you’d think it would be easy to get a loan for land. I’ve found that is untrue. Banks can be very cagey about loaning money for recreational land, largely because they don’t want to own it if, for some reason, you can’t make the payments.

For my first two properties, I put a sizable chunk of money down, then took out a personal loan for the rest. That left me with a loan that sported about a 6% interest rate, which isn’t terrible but isn’t great.

For the last property I bought, I went through a credit union instead of a huge banking institution. They worked with me to find a solid financing solution. I ended up refinancing my truck for a sub-2% interest rate, which is very hard to beat.

While there are plenty of financing options available, be prepared to have a decent down payment. There is no way around it, and banks always want to see you have some skin in the game. If you’ve squirreled away 20 or 30% of the purchase price, you’ll have much better options for acquiring the financing you need.

Done Deals

done deal

After you’ve closed on your new personal paradise, the work will begin. It’s easy at this stage to go crazy because it truly is liberating to own some acreage, but it’s best to think things through first.

For example, on one of my properties, I picked out a spot to make a food plot for deer and other critters. One winter day, I went in and started cutting down trees to clear out my chosen spot.

After a long day, a friend of mine showed up to check out the work I’d done. He also found a few good-sized Hawthorne apple trees that had escaped my saw blade and a few that hadn’t.

In my fervor to get working, I hadn’t even considered that I might accidentally cut down a few desirable fruit-bearing trees. If I’d taken a walk with some flagging tape in hand, I could’ve saved those trees.

If you’ve got low land on your ground, you’ll want to know how wet it gets in the spring before trying to plant trees or create a garden or food plot. If you’ve got steep hillsides, which is very common in small parcels that are sold off due to their unsuitability for commercial farming, you’ll want to think about available sunlight and ease of access before doing any work.

The same goes for everything from clearing small trails or roads to planning a cabin. Get to know your land before you make those big decisions, and you’ll be far less likely to regret them later.

Stepping stones

ss power your home optimisedWhen you do take the plunge to buy a parcel, even if it’s a small one, you’ll probably grow attached to it quickly. There’s nothing wrong with that, but it also helps to consider that a small property might become a financial stepping-stone to something bigger.

Pay attention to the real estate market as a whole, because you might find that the 20 acres you bought five years ago are now likely to bring in double the price you originally paid.

Real estate is generally a good investment and only gets better with time and the amount of work you put into it. That means that while you might outgrow your first purchase, someone else will gladly pay you well for it. This could allow you to upgrade to a larger property, which is never a bad thing.

Conclusion

There are many reasons to own land and a lot of ways to talk yourself out of it. The truth is, land ownership is within reach more than you probably think.

You just need an open mind, a willingness to invest plenty of sweat equity, and the acceptance that you probably won’t start with a dream property. That’s okay, however, because it only takes a few years for a less desirable parcel to turn into your own personal paradise.

This article was submitted by Adam Derek.

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