How to Build a House – Lesson 2 – The Construction Lot – Part VI – Due Diligence
Real EstateWhat to do after the purchase contract is accepted
1. Rights of way of public service lines
Contact the company that owns the pipeline or power line that crosses the property and find out what it can or cannot do with your easement. Some companies, like Colonial Pipeline, will fly these rights of way almost daily by plane or helicopter. If you start disturbing the ground at this right-of-way without your knowledge, they will close the job.
2. Percolation test
If you don’t have access to a sewer line, you probably have a septic tank. If you have a septic tank, you will perform, in conjunction with the county health department, what we call a percolation or “benefit test.” Most county health departments will allow you, the owner, to take this benefit test. Due to my busy schedule, I usually hire the surveyor to do it. The health department will provide you with instructions on how to perform the benefit test; it is simple. If you don’t pass this benefit test, it could mean you can’t have a septic tank. Make sure you have completed the benefit test and that the property is approved for a septic tank. If the property does not pass a benefit test, many people think that it is “impossible to build” for a house because they think that you cannot have a septic tank, it is not! There are other alternatives; For example, you could use what is called an aerobic treatment unit. This system is more expensive than the conventional septic tank, but it would allow you to build on what some would consider a non-buildable lot. Be sure to check with your health department because the aerobic system may or may not be approved for your area.
3. Soil test
In North Georgia we have “good ole” red clay. If you’ve never been to Georgia, it’s really red and it’s a real pain to take off your clothes and carpet. However, this red clay is very stable as a base. There are many parts of the country and Georgia where the ground is very unstable for a base. In those areas where the ground may not look “good”, you may need to perform soil testing and / or engineering to properly install a home foundation. If you fear a problem with the soil, I recommend that you call a “soil engineer”. A soil engineer can analyze the soil and tell you if it is stable enough to support your home. If it is not stable, the soil engineer can tell you what can be done to stabilize it. You may also need a “structural engineer” to design the foundation for any unstable terrain. You can find these engineers in the Yellow Pages under Engineer – Geothermal and Engineer – Structural. The construction of a house is basically the same throughout the country. The base is what changes a lot from one place to another due to the soil. If you install the foundation correctly, the chances of something major happening to your home, from a structural point of view, are very slim. You don’t want a foundation problem. Therefore, check your flooring and seek professional advice if the flooring doesn’t test well or doesn’t look “just” right.
4. Wetlands
Wetlands can be a real and serious problem. The department that oversees and regulates wetlands is the US Army Corps of Engineers The Army Corps of Engineers has mapped many wetland areas and can give you brochures to help you determine if your property contains wetlands. What is confusing are those areas that appear tall and dry that are designated as wetlands. If you unknowingly build in these areas, your home construction may be stopped because it is illegal to disturb a wetland environment. If in doubt, check with the Army Corps of Engineers and find out if there could be a problem. For more information on the U.S. Army Corps of Engineers, visit their website.
5. Floodplain
A floodplain is another type of land area designated and regulated by the US Army Corps of Engineers.The Corps of Engineers will designate an elevation point called the “100-Year Floodplain Mark.” In theory, only once in 100 years would there be a floor where the water level would rise above this point of elevation. Your surveyor may indicate this 100-year mark on your survey. Most cities and counties will not allow you to build in an area designated as a floodplain. In some floodplain areas, you may be allowed to add fill soil to raise the elevation of the house above the flood mark. However, in many flooded areas, you may not be allowed to do this, because without adequate drainage the problem would be exacerbated by flooding. It is like placing a stone in a glass of water; you will raise the water level. I remember a property that I put under contract for a subdivision and there was a small stream on the property. I didn’t think there was any problem. It turned out that more than half of the property was in a designated flood area. It was also the type of flood area that he was unable to complete. The seller was surprised; They said they had lived there for 30 years and had never seen the stream flood. If the landlord was correct, they could possibly do the necessary paperwork to remove your property from the designated flood area. It didn’t matter to me, it was a dead deal. You can view these designated flood areas by purchasing copies of the flood insurance rate maps [FIRM]. The easiest way to obtain a copy of a FIRM map for your area is to go to the Federal Emergency Management Agency website. [FEMA]. It is not unusual for part of a parcel to be in a floodplain. The problem arises when any part of the house structure is within the designated area of the floodplain. If the home is in the floodplain area, your lenders will ask you to purchase flood insurance. The maximum amount available for flood insurance is $ 285,000.00 and the flood insurance premium can be expensive. Many lenders don’t even make a loan for a home where part of the structure is in the floodplain.
6. Tax setbacks
If there is a creek or creek on the property, even if it is not in a designated floodplain area, there may be restrictions on how close you can build to that creek or creek. These restrictions are federally mandated to minimize sediment runoff in a particular stream or stream. Check this with your city or county building department.
7. Study of hydrology
Some houses I build are very expensive; I treat them like a commercial job and hire an engineer to do a “hydrology study.” The hydrology study will indicate if there will be a water runoff problem after the house is built. If there is a problem, this engineer will design a solution to the problem. The type of engineer who does this is a “civil engineer.” If you ever have a problem with your water drainage and need to correct it, contact a civil engineer. You will find them in the yellow pages under Engineer – Civil. Some areas of the country may require a hydrology study in each home. The Building Department in the city or county you will be building in should be able to tell you. Don’t let the fact that I recommend these engineers scare you. In any case, you should be afraid if there are no engineers involved in the project. Don’t spend a ton of money on these engineers and shop around, you will see a huge variation in price from one engineer to another. Don’t be afraid to hire these engineers; I’d rather you spend some money up front to find and solve a problem than spend a lot more money later to solve a problem.
8. Hazardous waste and buried trash
I am beginning to see that more and more builders are required to provide a certified document stating that there is no buried trash or hazardous waste on the property. There are engineering companies in any area that can perform these tests and provide these documents if you need them.
9. Rock test
Even if you don’t see any rock on the surface, if you have serious doubts about the rock, you can hire companies to check for rock. Contact a soil engineer to find out who to use. They can drill or dig test holes in the ground to tell you how deep the rock is below the surface. This way you will know if you are going to have trouble installing a driveway, basement, swimming pool, sewer line, or septic tank.
10. Survey
Once you have the property under contract to buy, I recommend that you go ahead and get a current survey (no more than 6 months) by a licensed surveyor. The survey will clear up many potential problems. For example, the survey will show any easements on the property that you cannot see with the naked eye. The survey will also show any area of the property that is in a floodplain. I know people who believed their lot was 200 feet wide on the road and 2 acres in size. Their dad even told them it was 2 acres with 200 feet on the road. They would sell the property based on this information, only for the new owner to order a survey and find that the property is 1½ acres in size, not 2, and there is only 150 feet on the road, not 200 feet. The deal could fall through right there. If you have an old survey, you may be able to have the original surveyor update it for as little as $ 50.00. If there is a flat subdivision filed with the court, find out who made the original subdivision and they may be willing to inspect the lot for a cheaper fee. Remember to shop around; You will see a large variation in price from one surveyor to another. One last item, ask the surveyor to provide a legend on the survey for clarification. A person new to the industry may not understand that “IPF” in a corner of the property stands for “Iron Pin Found”.
11. Topographic map
The topographic or “topo” map will show the contour of the terrain. If your property is relatively flat, you may not need to spend money on a mole. The surveyor is who we hired to do the topo. Like the survey, to get the best price you will need to shop around.
If you are designing a home for a certain lot and / or working with steep or rolling terrain, a topographic map will be very beneficial. The ideal mole is what we call a “2 foot mole” (as opposed to a 4 foot mole). What this means is that the distance between each line represents a 2-foot drop or rise in the ground. In the grading world, a slope of 2% or less can have problems with drainage and a slope of 15% or more could cost you money to fill in the soil, remove excess dirt, or build retaining walls. The topographic map can show you if you are going to need $ 10,000 in fill earth or a $ 20,000 retaining wall. These are issues you want to know about before buying a lot. If you are in a major metropolitan area, check with your county highway or engineering department. They may have on file a topo of the property you are interested in buying.