How to buy land and build a custom home

Building a custom home is the ultimate way to get exactly what you want — from the floor plan to the finishes. But before you break ground, you need the right piece of land and a clear plan. Here’s how to navigate the process from start to finish.

1. Define Your Vision and Budget

Before you shop for land, decide:

• Home size and style – This affects lot size and building requirements.

• Budget – Factor in land cost, construction, permits, utilities, landscaping, and a 10–15% contingency.

• Timeline – Building can take 12–18 months or more, so plan accordingly.

2. Find the Right Location

Consider:

• Proximity to schools, work, and amenities

• Road access and traffic patterns

• Neighborhood restrictions or HOA rules

• Future development plans in the area

3. Work With a Land-Savvy Agent

Not every real estate agent specializes in land sales. Look for someone who understands:

• Zoning laws and building codes

• Septic and well requirements

• Utility access and easements

• Land surveys and boundary verification

4. Check Zoning and Permits

Zoning rules determine what you can build.

• Verify if the lot is zoned for residential use.

• Ask about height limits, setbacks, and any special restrictions.

• Contact the local planning department before making an offer.

5. Arrange Utilities and Infrastructure

If the lot isn’t already connected to utilities, you’ll need to budget for:

• Water (public connection or well)

• Sewer (public connection or septic system)

• Electricity and gas

• Internet and cable access

6. Choose the Right Builder

• Interview multiple custom home builders.

• Review portfolios and check references.

• Get detailed bids that break down labor, materials, and timelines.

7. Secure Financing

Financing land and construction is different from buying an existing home. Options include:

• Construction-to-permanent loans – Combine construction financing and your mortgage into one.

• Lot loans – For buying land you plan to build on later.

• Owner financing – Sometimes available directly from the seller.

8. Close on the Land and Start Building

Once you close on the lot:

• Finalize home plans with your builder.

• Apply for building permits.

• Begin site preparation and construction.