As a matter of fact, there are a lot of steps involved in doing environmental due diligence. Let us say for example that everything is done correctly, the risks associated with land development are significantly reduced while the possibilities for making profits are increased.
The first step before you decide to sign a contract with the seller is negotiating clearly all terms you need in environmental due diligence. You can avoid problems to arise in the future say that you and the seller as well has understood all that is expected of both sides, particularly in due diligence period. This is basically when a lawyer will come into the scene to ensure that the transaction goes smoothly and no problem will arise.
We know that buying a land is risky and it is advisable to try minimizing all potential risks from the start. Most of the time, land purchase contracts are going through numerous revisions and negotiations and it’s more difficult when the contract has been signed to get both parties agree on contract amendments. Like what mentioned earlier, there are a number of different factors that go with the entire process of environmental due diligence which can influence the decision of buying an unimproved land and these are as follows.
Number 1. Title issues – are there anything suspicious on the land title or put it simply, does the property’s title come clean? As the buyer, it’s your responsibility to review all the reports and the underlying documents that may affect the property. It is strongly recommended regardless if you’re an amateur or a seasoned developer/investor to hire a real estate lawyer to review all documents on your behalf. On the other hand, you’ve got to review the documentation yourself too.
Number 2. Survey Issues – when it comes to environmental due diligence, you have to check if there are encroachments from adjoining land on your properties or vice versa. Encroachments can be utilities, neighboring buildings, water, fences and the likes. You and the seller as well need to resolve these issues before closing on the deal if there are any of it. Some issues might not be resolved or can be resolved in a timely manner and you have to decide if you still like to continue with the purchase even if there’s unresolved issue in the land.
Number 3. Land use approvals – also, you must not forget about the zoning regulations, building permits and approvals, site plan approvals, setback issues, lot size, fire safety issues, health issues like septic disposal, sewer, storm water management, rivers, wetlands, streams and so forth in environmental due diligence.