 If you are drawn to a calm meadow, cascading river, sunny beach or placid lake, perhaps you can use these long, warm summer evenings to begin searching for your dream investment. With mortgage interest rates at historically low levels and real estate on an upward appreciation swing, it’s a great time to add to your overall investment portfolio with another piggy bank you and your family can use.
My wife and I started our personal search for a weekend-vacation getaway on summer evening nearly 25 years ago. Even then, prices seemed sky high. It didn’t take long to realize that virtually everything we looked at was out of our price range. The smallest, most remote cabins and lots were far more expensive than anticipated.
We spread the word to REALTORS® in our three areas of interest and even contacted a few friends who had owned cabins nearby for possible tips and leads. We were determined and felt that somehow, somewhere we would find an acceptable property with decent terms and conditions. We pinpointed some properties and asked our REALTORS® to contact owners of the seemingly cheapest cabins and vacant lots to see if the owners would consider selling. I even tracked down some plats at the local courthouse, copied the lot numbers and found the listed owners through tax records. We then asked our REALTOR® to write a few query letters and got several “maybe” responses.
One owner asked that we contact his attorney about a vacant lot on the east side of a small beach community. It turned out the man had been involved in the original platting of the community and at one time had owned quite a bit of property in the region. He said he thought all his lots had been sold long ago.
His attorney researched the man’s holdings and concluded that the man did, indeed, own the vacant lot and would part with it for $5,000. We told the attorney we would buy the 50-by-250-foot property contingent upon the approval of all services.
It wasn't prime, but it was $5,000 – a big number to us then – and not far from a tiny community store where our kids could walk to buy penny candy (remember penny candy?) There were no problems with power or water. The only thing that stood between us and a buildable dream lot was an approved septic-system design and percolation test. The lot had the required square footage, but water from the side of a small hill periodically made the ground soggy.
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While doing property research at the courthouse, I met a registered sewage disposal designer who said the drainfield design, percolation testing and required county paperwork would cost $195. I considered doing the job myself (a designer or engineer was not required) but felt our chances for approval would be better if a professional did the work.
In the end, a health inspector decided the dry area of the lot was too small to adequately accommodate the septic system and she denied us a sewage-disposal permit – an opinion upheld by the district supervisor.
We were stunned. Without a septic permit, we could not build our little beach house. Alternative systems were not allowed by the community association. Adding to the sting was the fact that most of the cabins were on lots smaller than the minimum size required for septic approval. They were built when the laws were less stringent.
Should we try to buy the adjacent lot? Maybe with an additional lot we could pass the septic inspection. But the county said the adjacent lot had problems, too.
We decided to walk away from the beach community lot. The experience was not worthless. We’d met the most efficient REALTOR® we’ve ever encountered, found a lot, its owner, history, taxes, neighbors, market value, and requirements for building. It did not work out, but at least we knew why it didn’t.
And, the research helped us prepare – then pull a timely trigger – on our eventual getaway. A year later, our REALTOR® called with a spot on a lake that we still share with another family. We had our ducks in a row, and made an informed offer while two other competing buyers would not commit without knowing more about water and sewage.
If it’s warm tonight, take a drive and explore the possibilities.
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