Notes From the Book Country Property Dirt Cheap
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Some points

  • The term "in fee simple" means complete ownership.
  • All deeds for purchases must be recorded at the Recorder's office at the county courthouse.
  • Ask the Recorder if an Abstract of Title is needed. If the seller hasn't got that, it costs big money to have a new one made.
  • An attorney should handle the transfer of the land.
  • Tax rates may be higher below a certain # of acres due to the assumptioin that greater than that number is farmland.
  • The courthouse can tell you who owns a given property, if you have good directions / location info. Record the number of miles from intersections, nearby buildings etc. They can provide you with the name and address of the owner.
  • Consider putting up posters with the same info as the advertisement you put in the paper. Put it in cafes, gas stations, hardware stores etc.
  • Also just ask around in your target area. Ask people who hear other people talking. Example, barbers.
  • Identify the cheaper parts of your target area.
  • Ask loan officers at banks if they have foreclosed on any properties.
  • Ask land surveyors, attorneys etc. Tax assessors at courthouses.
  • Consider offering a finders fee e.g. $100.
  • Note that sellers may lie about where the boundaries really are. It's vital that you find out the truth.
  • If the owner will become a neighbor, ask if he/she or another neighbor will want an easement -- this can be a source of interpersonal trouble, of pollution, of noise etc.
  • There has to be a straight path (not circuitous) to the property. The windy paths are a pain and they make it costly to add electric and rural water.
  • If you use a holding tank for sewage, it must be pumped, emptied periodically and that costs.

Important questions to ask

  1. Number of acres.
  2. Location (township, section).
  3. Type of land (crop, timber, pasture, hilly, flat).
  4. Buildings (house, barn, shack, cabin).
  5. Is there water? (well, pond, rural water)
  6. Type of road it's on (dirt, gravel, paved).
  7. Utilities hooked up? (electric, phone, rural water, septic)
  8. What are the taxes?
  9. How long have you owned it?
  10. Why are you selling?
  11. Is there a deed to this parcel, or are you selling off a piece of a larger tract?
  12. Do you own it outright, or is there a mortgage or contract outstanding?
  13. Is there an access road leading from the county road onto your property?
  14. Are there boundaries marked by fences?
  15. What is the asking price?
  16. How do I get to the property? (directions)

More

  • Make sure that the seller owns the property free and clear, and that it was not sold to this or that person who never paid.
  • Make sure that no one's possessions e.g. old cars, animals, have been left on the property. You could be sued for trying to move them.
  • Deciduous tree = decaying, shedding
  • You need to ask if you can return to examine the property -- you should examine it without the owner present later so that he doesn't lead you away from trouble areas etc. For example, check the condition of the fence.
  • For judging whether the location of the site is good, record both the odometer and time to drive it.
  • An owner may press for a "quit claim" because for forfeiture of the contract is required due to nonpayment, and that takes times (in Iowa, 6 weeks).
  • A neighbor may dissuade you from buying the property because he/she wants it, may point you toward another. On the other hand, he/she may do this on behalf of the owner simply to make you think the property is better than it is. Do they know each other?
  • You need to locate the water, septic -- the seller may be lying, and maybe they aren't even installed.
  • The Tax Assessor can tell you:
    • soil quality
    • taxes you will pay
    • taxes at time of last purchase, which can indicate how much it went for if the actual price is not available
  • "Assessed value is below market value."
  • Even if the Tax Assessor doesn't need to have a property surveyed, you might want to do so "to protect yourself".
  • The Recorder's office can tell you the previous purchase price if it was recorded.
  • Purchasers pay the country a "transfer tax" at time of sale. The Recorder can tell you what this tax was last time, and by looking in the Real Estate Transfer Tax Table they can tell you what the purchase price range was.
  • Even 300 ft away, you can hear cars passing if their speeds are 60+ miles per hour.
  • A "plat book" tells you who owns each property, how large it is, who the neighbors are. It gives their addresses for contact, for everybody in the county in fact. Buy one at the Tax Assessors office or at an insurance company. Buying one allows you to make fewer trips to the courthouse. Also it tells you lives on a property if not the owner. Plat books are organized by township and section. Good for telephone responses to ads, since you can look at the book before going out to look at a prospect.

Chapter 15

  • Land auctions bid by $/acre.
  • Ads for auctions in the paper list the location, and you can locate them in a plat book.
  • It's not often that a cheap property is auctioned, says the author.
  • Important factors for pricing of land along a river.
    • distance to town
    • availability of water
    • access to property

Chapter 16

  • Government surplus land is listed and auctioned by the GSA (Govt Services Admin). They have a BBS which makes the listing available. Get the phone# from any GSA office.
  • For a printed listing of US Real Property Sales List, it's free from US Consumer Info Center, POB 100, Pueblo CO 81002, or from any Bureau of Land Management office.

Chapter 17

  • Tax sales are rarely useful (says the author) since lands bought can be "redeemed" by the owner.

Chapter 18

  • In Iowa, the state university "extension" has an agent who assists farmers. This person can provide a pamphlet giving comparative values of land by county. But these are farm land values.
  • Timber land goes for less than prime crop land. You can sell the timber to logging companies.
  • The pamphlet helped the author identify cheaper counties in his target area.
  • Go to real estate agents in those counties.
  • Ask the Tax Assessor or a real estate agent what the residential cutoff is for the # of acres. It's different in each county.
  • Real estate agents don't call you -- you call them, or visit them.

Chapter 19 -- Tractors

Skipped

Chapter 20 -- Water

  • If you want a property that is between A and B number of acres, scan the plat book.
  • Whereas the plat map identifies boundaries, the topo map shows buildings as dots and timber as green.
    Together, these two maps tell you a lot, most of what you need to know.
  • If a property has no water, you have problems.
  • Runoff from farms is not drinkable.
  • If animals (e.g. cows) walk in and out of a stream, then that water is not drinkable.
  • Call the municipla water dept to find out which rural water district a property is with.
  • Extending from the "main" water i.e. the main pipe, in Iowa costs $2/foot + $20/foot under the main road. This can be >$10000 depending. To get from road to property is another $1500 in Iowa.

Chapter 21

Skipped

Chapter 22

Skipped

Chapter 23

  • Sometimes you have to call/visit multiple times (e.g. 5) to reach an owner.
  • Riverfront property has problems:
    • Mosquitoes
    • Erosion due to current
    • Wetness and mud (and mold?)
    • Flooding, including all the debris that brings (how high does it go? you need to know)

Chapter 24

Skipped

Chapter 25 -- "Why so few small parcels"

  • A farmer can only split off so many chunks of his property before he has to deal with subdivision laws.
  • Farms usually don't want neighbors.
  • Farms who have owned a piece of land for a while are attached to it, and won't sell small chunks, but new owners of farmland may just do it.
  • Pooling resources with others to buy and split land means agreeing on what kind of land you want -- difficult.

Chapter 26

  • If the description on a deed of where a property is located is in metes and bounds then propbably you will need to have it surveyed. BUT the rules vary from county to county as to whether a survey is required.

Chapter 27 -- Surveys

  • Most states are broken down into 6 mile by 6 mile "townships" and 640 acre "sections".
  • Surveyors charge by the hour. Recent surveys help bring down the cost. Foliage is an obstruction, so winter is a better time to survey.
  • Surveyors leave 4 markers -- one for each corner of a rectangular property.
  • Surveyors nowadays don't want around a property. They go to a high point and "shoot down" to the corners, measuring distances.
  • Surveyors are required (since the 1980s) to file a "plat" with the county Recorders office.
  • Section corners are recorded at the County Engineers office.
  • "Metes and bounds" is an easier description for a surveyor to deal with. The other option is "township and section", which requires the surveyor to go out and establish where the section is.
  • Surveying costs $55/hr in Iowa.
  • Courthouse work is $25/hr.
  • Drafting is $25/hr.
  • An 8-acre parcel is $1000-$1500.
  • Parcels and fence lines often don't line up with section and township lines well. Metes and bounds is the "best legal description".
  • Metes and bounds = low tech and verbal.
  • Section and township = high tech
  • 1 acre = 43560 sq ft.
  • Doing a survey on your own is possible and is a good idea if you can do it right.

Chapter 28 - utilities

  • If rural water "main" line goes next to the property, you may still have to pay $$$, in order to reimburse whoever paid to have it brought in there in the first place. (Special case? He says this info was for Iowa, and this was only for a period of a few years after it was installed.) He was looking at having to pay $1000.
  • Then there is the cost to bring water onto the property. This costed him $1100.
  • Cost for water is high in Iowa (1998), at $18.72/month = 2000 gallons. [Who needs that many??]
  • Telephone: If a telephone "pedastal" is near the property, you can cheaply ( less than $100 ) have the phone company extend a line onto your property.
  • A wooded area, which the sun can't shine on, doesn't dry out well. In Iowa, maybe it never does. [Q: is it legal to build a large treehouse? what about ants and termites? saw this on TV once...]

Chapter 29 -- offers

  • Verbal offers even if accepted are not legally binding. Get any agreement in writing as soon as you are sure you want the property.
  • Lowball offers can anger the seller and make them refuse to deal with you -- especially if they don't really need to sell as is often the case with farmers. It makes him think you are insulting his intelligence.
  • The owner may have associated his identity with the property -- lowballing insults him in this way too.
  • If a sellers accepts a lowball offer, he has to expect you to brag how stupid he was, what a bad negotiator he was -- this adds fear of humiliation.
  • Unless you are very experienced, you will need an attorney or broker to draw up the paperwork. Real estate agents have standard forms that everyone recognizes.

Chapter 30 -- the right property

  • If a property is all timber, you need to know, has a road been cut onto (into) it. If not, tht's more work and expense for you. Also is there a clearing anywhere in it?

Chapter 31 -- Last Exploration

  • In Iowa, if a neighbor has attle, you are responsible for upkeep on half of it [??? the fence ???].
  • A fence (in Iowa) which has been in place for more than 10 years is the legal boundary -- usually.
  • The description on the deed overrides the lines on the plat map, especially if that description has been used in multiple transfers of a property over the years.
  • Rural H20 in Iowa: $20/month.
  • Always ask if there exist any easements in place with respect to the property. These can be severe in nature and may only be recorded in the Abstract of Title!

Chapter 33

  • A "groundwater hazard statement" explains whether:
    • there exist any solid waste disposal sites on the property
    • there exist any hazardous wastes on the property
    • there exist any underground storage tanks on the property
    • there exist any wells on the property

List of search techniques

  1. Drive down rural roads for abandoned or neglected farmsteads.
  2. Stop farmers you see along the road and ask if they know of any land for sale.
  3. Offer a reward (finders fee) for info about available land.
  4. Post "land wanted" signs.
  5. Land auctions.
  6. Ask people at auctions if they know of property for sale -- do this at any sale of rural land, equipment, etc.
  7. Print up circuars and put them in windshields.
  8. Investigate the properties that will be auctioned off for unpaid taxes.
  9. Use boat to find river and lake property.
  10. Study plat books to locate small parcels, also topo maps.
  11. Ask locals who hear things, e.g. barbers.
  12. Ask bankers re foreclosed properies.
  13. Ask town supervisors, sheriffs deputies, whoever.
  14. Surplus government land.
  15. Check ads in paper.
  16. Place multiple ads in papers.

Last point: if a farmer has just picked up a piece of land for cheap, he may not want the buildings on it, and perhaps someone can buy them [the author did].

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