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10 Considerations for Investors Buying Land for Sale in Tampa, FL in 2022

Published: 03-11-22 Category: Investing

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The battle for location is at the top of every investor’s mind. Whether it’s purchasing land or a building, location is a strong factor. For example, it makes sense that land way out in California, MO, isn’t going to have the same value as land in Tampa, FL. They’re two different areas, and thus have to be examined separately.

Speaking of Tampa, there are ten key considerations to make before exploring land for sale in Tampa, FL.

#1 – Start With the End in Mind

Buying land without a plan is just like going to the store hungry: everything looks good, but that doesn’t mean that it’s a great way to spend money. Here are some questions that make sense to kick off your land acquisition mission:

Will the land be held in hopes of a higher offer from a future developer?
How much money is set aside for land improvements?
How does land acquisition serve existing business objectives?
Do you already have a construction team in place for upcoming work?

These are not the only questions that investors need to ask when looking at land, of course. Every investor is going to have different goals, but looking at the fine details of the plan makes it easier to visualize land being useful, not just something to acquire.

Even land that isn’t actively in development is useful as is; there’s nothing that says that a quality lease to another business entity can’t be on the table.

#2 – Pursue Local Incentives

Investors unfamiliar with Florida should know about the tax advantages already in place: there’s no corporate income tax on limited partnerships or subchapter S-corps, no state-level property tax assessed, no personal income tax, no property tax on goods in transit for up to 180 days, and no sales tax on manufacturing machinery and equipment.

With so many benefits, it’s not surprising that many people choose to open up businesses in Florida.

Tampa has its own Business Development Council that focuses on giving incentives for businesses choosing to do business in Tampa. Buying land for sale in Tampa would unlock the opportunity for benefits. The more that your upcoming project benefits the community, the more likely it is that there are multiple incentives in place. This is even more the case when it comes to bringing jobs to the area.

#3 – Check for Easements

An easement is simply the right for someone else to use another person’s property for a well defined purpose. An example of an easement is when the utility company has the right to go onto private property to handle a power line or other utility-related task.

Not all easements are bad, but they are something to be aware of when purchasing land.

Easements transfer with the sale of a property, but they are easily discovered during the title search process.

#4 – Make Use of Existing Services

The primary difference between improved and raw land is that improved land already comes with key services, like water, sewer, and electricity. If those services aren’t already handled, the budget has to include bringing those services to the property.

In the case of land for sale, this also means that there’s room to negotiate if you have to put in additional essential services.

The quotes to install existing services will certainly vary, so make sure that second and third estimates are provided from a wide variety of contractors. This is extensive development and has to be handled with care.

#5 – Triple Check Boundaries

Boundaries are important, and ignoring where the boundaries are on a piece of land can create messy legal problems. Even before any formal agreement to buy the land occurs, it’s a good idea to check where the boundary lines are.

#6 – Let Accessibility Become a Top Priority

Acreage doesn’t mean much without access, so every offering of land for sale has to be examined for accessibility. What are the roads like coming in and out of the property? What are other infrastructure projects in the area? Knowing what’s available regarding current and future access is very important.

#7 – Determine Real Market Value

The price offered for any land for sale in Tampa, FL has to be measured against its real market value. Sometimes that’s tricky to determine, but building comparables is the key to determining whether the land is being offered at real market value or just overpriced.

#8 – Don’t Skip Over Insurance Concerns

Building a strong insurance package before the acquisition is about looking at what’s required with an insurance professional. The right blend of insurance products will depend on the specific plans for the land. Building self-storage facilities or logistics centers will have different insurance needs than a commercial farm.

#9 – Examine Topography Thoroughly

Buying a piece of land is about looking at its unique features. How sloped in the land? Land that’s too sloped can pose problems and create additional costs. Examining topographic maps of Tampa can help give a new dimension to the land you’re most interested in.

#10 – Good Documentation Is Priceless

It seems like common sense to advise investors to have the proper documentation set up for financing, but it is a common mistake. The thrill of hunting for new land for sale in Tampa, FL, is kind of like going to the grocery store. It’s much more fun to buy groceries to cover all the delicious dishes, but it’s not as much fun to do the actual cooking.

Ensure that all business financial statements are in good shape, along with an overall plan for financing. Will you go through a lender or pursue private money? Are you looking at a partnership just for this acquisition, or is this a solo project?

Average Cost Per Acre of Land in Florida

When looking at the average cost per acre in Florida, be aware that prices can undoubtedly fluctuate. Multiple factors are involved, including whether the discussion is just on farmland or includes urban areas as well. The most popular counties for land purchases are provided below, along with the average cost per acre of land in the county.

Orange County: $88,722;
Sarasota County: $76,928;
Seminole County: $73,144;
Hillsborough County: $39,993.

Again, cost per acre in Florida can vary wildly as more demand for usable acreage increases the prices. These numbers also do not reflect private sales that could easily skew the prices in either direction.

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