Doing Your Due Diligence When Buying Rural Property

In September 2018, my husband and I signed the closing documents for 36 acres of undeveloped, off-grid land among the pinon pine, junipers, and meadows north of Williams, Arizona, and south of the Grand Canyon. We were (and still are) thrilled with our new property after several months of searching, looking at dozens of properties, and even backing out of a contract to purchase a different property. Along the way, we learned a great deal about what to ask about and look into when considering a rural parcel. We also learned that, while many real estate agents know their stuff when it comes to residential and urban properties, they don't necessarily know the ins and outs of rural real estate, so it's important to do your own thorough due diligence before signing that contract to purchase and ultimately buying land. While our experience is specific to northern Arizona—Coconino County in particular—I hope the knowledge we picked up will be helpful no matter where your property search takes you.

Questions to Ask and Things to Know Before Buying Rural Property

We didn't really know what questions to ask about rural properties we were interested in when we first started our search, and we learned (almost the hard way) that just because a property might look and feel like just the place to buy, reality isn't always so clear-cut or acceptable.

These are some things to think and ask about:

Is there legal access?

The simplest legal access to a property exists when a parcel has frontage on a publicly accessible road. But sometimes, topography or water features may restrict access to the property from the road, or there may be one or more other privately owned parcels between the public road and the property.

When the property cannot be accessed directly from the public road, an easement through other properties is required for a right of way. An easement is commonly described in deeds as providing ingress, egress, and regress from a property, across the land of one or more other properties, to a publicly accessible road.

Legal access matters. One thing we found out about a property we almost purchased was that it did not have legal access, even though we could drive right to it. No legal access means the county would not issue any permits for building, solar, septic, etc. And if you build without a permit, that can lead to problems down the road, particularly when trying to finance a building project or resell the property. It can even lead to fines or, worse, an order to deconstruct a building in whole or in part. Be aware of the risks associated with purchasing a property that lacks legal access.

See also: Should you buy property without legal access?

Is there physical access, and is it the same as the legal access?

Just because a parcel has deeded, legal access doesn't mean you can actually drive right to it. Perhaps no road has been created yet. Or maybe the route is there but difficult or even impossible to access by vehicle. Perhaps access is limited or not possible at certain times of the year.

We looked at a property with beautiful views and other appealing features, but the legal access on the map did not actually exist "on the ground." There was, however, a good, unpaved road right to it ... but that road was not the actual legal access. It cut right through another yet undeveloped private property, but it was not a recorded easement.

By the same token, a property may have physical access, but that physical access (via a road) may not actually be a legal access. Be sure to ask, rather than assuming based on what you see and how you drive to a property.

Is the physical access to the property maintained or plowed?

Does the county, city, or a private party hired by an HOA/POA take care of this? Or would you, the property owner, be responsible for maintaining the access to the property?

Is there a survey?

Surveys can cost thousands of dollars, so if one has already been done for the property you want to purchase, request a copy from the seller or, if recorded, you can request a copy from the jurisdiction's building inspector or the land records office.

In addition to the property boundaries and corners, a survey will show any easements.

See also: What is a Property Survey and Why is it Important?

Are there easements?

An easement is a legal right to cross or otherwise use someone else's land for a specified purpose. Most properties have one or more easements, including those for utilities, even if currently none exist. You'll also want to know if there are easements for access to other otherwise landlocked properties, which may be used for ingress/egress by other property owners, present or future.

There are rules about what you can and cannot do within an easement on your own property, including, for example, installing fencing, which you may be required to set back the width of an easement rather than right on your property line.

See Easements: Know Your Property Rights

What are the setbacks?

Setbacks are not a make-or-break thing when it comes to purchasing property, but you do want to know how far from the property lines you need to be when it comes to septic, buildings, fencing, etc. Setbacks are often different depending on the purpose of the setback and whether it's along a road versus other private property. There are also setbacks for water features and drainages, for example.

Has a site inspection (septic test) been performed, and if so, what were the results?

Many, if not the vast majority, of rural properties will require a septic system if you plan to have a dwelling of any kind on that land, because you can't just hook up to a municipal sewer system. The type of septic system required is determined by a site investigation (also known as a perk test, although that term is rarely used nowadays, at least where we live). Septic systems may be standard or conventional, or they may be alternative systems, which are much more expensive.

A standard system may run $5,000–$8,000, while alternative systems can cost tens of thousands of dollars. So, find out if a septic test has been done on the property you're interested in, and if so, what the results were. If no test has been done yet, you may want to ask the seller to have one conducted. If the seller is unwilling to spend the money for the test, it's up to you, the prospective buyer, to decide how important it is for you to do one before purchasing the property.

Septic tests/site investigations are specific to the location of the test. While one area of the property may pass for standard septic, other areas may not, so you'll need to decide where on the property you want to build, because your septic will need to be within a certain area of the test holes. This is particularly important on larger properties, where you have a variety of building site options and may prefer one over the others.

Is there an HOA or POA?

While many of us associate HOAs with urban, suburban, and rural residential properties, even some rural, multi-acre properties are part of an HOA, or more commonly a Property Owners' Association (POA). If so, I would find out who one or more of the board members are and give at least one of them a call before finalizing your purchase, just to make contact and get a feel for how they run their association and what they say the most important things are to know about living in the area.

If yes to the above, what are the rules and fees, and what do those fees cover?

In our case, the POA rules include provisions such as the percentage of trees that can be removed/cut on a property and limitations on the commercial use of a parcel, to name two of many. And our annual POA fees primarily go toward maintaining the cinder roads.

Make sure you receive a copy of the CC&Rs if there is an HOA or POA associated with the property you're interested in buying .. and read them. While the level of enforcement of those rules varies by HOA/POA, it's always important to know what those rules are.

Can you camp on your property?

Both HOAs/POAs and the local jurisdiction (e.g., county) may impose limitations on if and when, and for what duration and under what circumstances you can camp on your own property, whether that's tent camping or in a travel trailer or RV. Some jurisdictions will require a permit to camp on your land and limit the number of days you can do so in a given year. Sometimes those rules are different once you have a building permit. 

That said, many people camp on their rural properties even when it's not actually allowed by the rules and regs. Or they do so without a permit. And many never run into an issue. However, be aware of what the rules are and what CAN happen if you don't follow them. That way, at least you can decide if it's worth the risk and if you can accept the consequences if, say, someone complains and the HOA/POA and/or county comes a-callin'.

Are utilities available, or is this off-the-grid property?

Electricity, water, natural gas, telephone, cable/internet—all the services and utilities we're used to having curbside in urban, suburban, and even many rural residential areas often aren't as accessible, if at all, when it comes to rural properties. And, if you can get some or all of it to your property, the cost of doing so may be high or even prohibitive. So, if having these utilities is important to you, find out if any are available to the property and what costs you may incur to make that happen.

If, by contrast, you WANT to be off the grid—to use solar, wind, and other alternative methods for power, for example—you may want to find out if other surrounding people and properties can bring in utilities and if that would mean seeing power lines and pipes go in, for example. Would that be okay with you if it were to happen?

What will be the source of your potable water? Can you drill a well, have water delivered, or haul water?

In our case, drilling a well would not be realistic, as the water table is thousands of feet below the surface. Many property owners in the area have water delivered and stored in a large cistern or multiple cisterns, then pumped into their homes.

Some people haul water themselves, filling at local water stations and bringing it to their cisterns in tanks on the backs of their trucks or trailers. Other people collect and store rainwater (which can be used in conjunction with hauled or delivered potable water), which is what we plan to do. Note that rainwater should be (will need to be per code requirements in many areas) filtered before being used in the home.

Is there trash pickup service? If not, where can you take your garbage?

There is no weekly curbside pickup for trash or recycling where our property is located, though some residents have dumpsters and pay for a private company to come get/empty them periodically. If that is not an option available or one you prefer, find out where the local dump and recycling stations are located and what the costs will be for you.

On a related note, living on rural property is a great incentive to cut down on waste. It's amazing how much you can do that with some forethought and effort, not to mention composting.

Is there fencing, and is it on the property line with any required setbacks?

Just because you see fencing doesn't mean it's where it's supposed to be. In our case, an old pasture fence associated with the ranch in the area cuts across the back of our property, with four acres of our parcel on the other side of that fence.

People have assumed that that fence line is the boundary between what is now our property and the state land that borders us, so we've had to put up private property signs and attempt to block off a two-track that's been made by people driving along the fence, so it's a bit of an issue for us . . . though we did find that out before we closed on the property and were willing to accept it and deal with over time.

Also, if there is fencing on the property that is not where it should be, find out whose fence that is and whether you can move or remove it. I say that because, as in our case, that pasture fence is the property of the ranch, and while it can be moved back to coincide with our property line, it would need to remain intact. The move or new fencing would be at our expense, not the ranch's.

Is this an area of open range (free range) grazing?

Related to the above comments about fencing, if open range grazing is permitted in your area and on the property you want to purchase, it's important to know your rights as an owner and the rules, which may surprise you. For one, if you don't want the animals—in many cases cattle—on all or part of your property, it is up to you to fence them out and you'd need to do so at your expense.

There are also ramifications if a grazing animal gets hurt or is killed on your property and what the cause is. So educate yourself about what free range means to you if applicable to your property.

Here is an overview of open range law from the University of Arizona: Arizona Open Range "Law" Other questions you should probably have the answers to before you buy would be:

• What are your water and mineral rights?

• What are the current property taxes?

• What is the soil and substrate like? Is it good for building, growing, etc.?

• Is the property or any part of it subject to flooding?

What Other Questions Should You Ask?

What have I left out? What other questions would you suggest prospective buyers of rural land ask when doing their due diligence? Please let me know in the comments below, and I'll add them to the list.

A Word About Permits

While many people who own rural property opt to build without first obtaining a permit (at least, in this area, many do) and without going through the associated inspection process, others prefer to deal with the added costs and sometimes frustrations of getting those required permits in order to avoid potential pitfalls of going forward without them. We fall into the latter category—which is not a commentary on anyone else's decision, just what we were most comfortable with.

While the decision about obtaining permits for everything from houses to guest and tiny houses (sometimes known as accessory dwelling units), outbuildings, solar PV and septic systems and more is a personal choice, be aware of the risks of doing any of the before-mentioned projects (and other things) without a permit when a permit is technically required.

Also, be aware that if you want to hire out building projects or parts thereof, it can be a challenge to find contractors or subcontractors, especially those who are licensed, who are willing to work without a permit in place.

Also, if there are existing structures on the property you're interested in, were those structures built with permits (if they were required)?

Know that it may be difficult, if not impossible, to obtain a loan or mortgage to purchase property where there are structures that were built without required permits. Consequently, if you build without a permit and later decide to sell, you may have to find a cash buyer who is willing to overlook this fact and has the money to buy without a loan or enter into an owner-carrier arrangement with you.

Contact your jurisdiction's building department or visit its website to learn more about the requirements for permits, including when they are needed and what they cover. You can also ask questions about permit costs and code requirements.

See also: 12 Important Things to Understand About Building Permits.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

Have you bought rural property?

Have you purchased rural land? How was the experience, and have I missed anything above?