Vacant Land Purchase & Sale Agreements

Writing a contract for the sale of raw or vacant land provides a unique set of challenges. You'll need to think about things that have already been taken care of when buying an existing property such as site access, rights of way, restrictive covenants, boundaries and zoning restrictions. It's important to put your requirements in writing to make sure that you are buying – or selling – the property you expect.

Contract Basics

Just like any property sale, an agreement for the sale of vacant land should contain certain basic information, including the names of the seller and buyer, a legal description of the land, the purchase price, the initial cash down payment and the closing date. If you're not using an attorney, it's a good idea to start with a template vacant land purchase agreement that you can buy from an online legal documents website. These documents are drafted to include the usual conditions or "boilerplate" legal language that a lawyer includes in contracts to protect you if something goes wrong.

Describing the Land

You should be able to get the legal description of the land from the seller's deed, but if the land is being carved out from a larger plot, you may need to draw up a plan. A surveyor can measure the site and prepare a title plan so there's no dispute about the boundaries. Include a seller's obligation to maintain existing improvements on the land, such as fences and wells, in the same condition until closing.

Vacant Land Conditions

If you're planning on developing the vacant land, you'll need to do a lot of checking and testing to make sure the land is suitable for your intended purpose. Depending on the type of land, due diligence might involve:

  • hazardous materials tests and other environmental testing procedures
  • floodplain, wetlands and endangered species tests
  • percolation tests, required for the installation of an on-site sewage system
  • soil testing
  • water and mineral rights
  • compliance with zoning ordinances, subdivision rules and building codes

Be clear about the type of testing you need to have done and make sure the agreement describes who will do the work, the period for completing the work and who will pay for it. If you or your finance company requires that the land pass certain tests to complete the deal, specify that closing the sale is contingent upon those events.

Title Issues

Vacant land is often subject to rights of way and other easements that give another person the right to use the land in a certain way. For example, a utility company might have the right to run power lines through the land, or the town may have the right to build a road. Be sure to make it a requirement that the seller delivers clear title at closing, free from any problematic easements as well as from competing ownership or leasehold interests. Conversely, the land may have the benefit of an easement over someone else's land, such as a right of way over a shared road to your lot. If an easement is important to your land purchase, make it a condition of the contract.

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