Looking to Buy Michigan Hunting Land?

No Surprises on Property Taxes

People looking at property ask, "How much are the property taxes?" Quite honestly, it doesn't matter what current taxes are BECAUSE as soon as the property is sold the taxes are going to go UP. Once a property is sold, the property tax cap comes off. If the person selling the property has owned it for years their tax bill will be MUCH lower than what the new owner will pay. To estimate what property taxes will be after the sale a buyer can:

Land Contract vs Bank Financing

Land Contracts are sometimes offered but buyers need to consider a few things. Most sellers require a significant down payment for a land contract, good credit report, interest rates equal to or higher than a bank, short term or balloon loans, and can limit what you can do on the property until it's paid in full.

Why?

Because if a buyer defaults on the Land Contract a seller wants to protect their asset and cover their costs. Not all lenders offer vacant land loans so be sure to shop around. One of the major recreational land lenders is Greenstone Farm Credit. They have offices throughout Michigan. You can find them on the web too at Greenstone Farm Credit Services.

Survey and Property Size

When looking at Michigan hunting land for sale understand that a Real Estate Agent is not guaranteeing the property measurements. That is why you often see +/- when referring to acreage. Keep in mind that selling price is not negotiated at "price per acre" so a discrepancy in acreage won't automatically change the selling price. If a survey doesn't exist you may want to consider having one.

Zoning Ordinance & Building Codes

Big plans for your new property? Things like campers, pole barns, square footage requirements, animals per acre and a number of other land uses can be regulated by local ordinances. Buyers should call the township personally and ask questions before signing a purchase agreement. Firsthand information is your best argument if there is ever a dispute.

Purchasing Agreement is a Binding Contract

You finally find the perfect property and write a Purchase Agreement (PA). Remember, once the PA is signed, it is a binding contract. If a buyer or seller changes their mind for any reason other than something written in the PA and tries to back out of the purchase it is considered a breach of contract. If it is the buyer who defaults, they can lose their deposit or can be forced to honor the contract through legal action. You will always hear me say, sleep on it before you sign on the dotted line.

Earnest Money Deposit

An Earnest Money Deposit (EMD) is required from the buyer once both buyer and seller have agreed on price and the Purchase Agreement is fully signed. $1,000.00 is an average amount for an EMD but the amount can be negotiable. The EMD check is written to a title company and deposited into their escrow account until closing at which time it is applied to the sale price.

Attorney Recommendation

I advise my clients to have all paperwork pertaining to the sale of property reviewed by an attorney.