What Is a Lot When Building a Home?

Setbacks

• Before breaking ground for your new home, the contractor will determine the available space on which you can build as well as the property setbacks. Setbacks, which are invisible boundaries that determine where you can build on your property, create a uniform look in the neighborhood. They prevent one home from sitting near the street and the next home from sitting at the back of the lot. Setbacks also serve the purpose of deterring the spread of fire. In older developments, the homes may sit within feet of one another, but in new developments, the homes must sit a specified distance from the side property lines to reduce the risk of fire jumping from home to home.

Easements

• An easement is a section of your lot that another entity has a right to use. You will maintain this easement as you would any other part of your yard: plant grass, water and mow. Easements often run along the front of a lot next to the street or at the back, sometimes in a designated alleyway. Local utility companies may run waterlines, gas lines, phone cables and television cables in the easements.

Covenants

• Covenants are not building codes, but they are similar. During the planning stage of a residential neighborhood, the developer makes rules that determine what you can build on your lot. These rules might include the pitch of your home's roof, whether the home must have masonry on the exterior, the basic style of the home or whether you can put up a fence or build a storage shed.

Homeowners' Associations

• Other factors may affect what you can build or how you must maintain your lot, and they deserve careful consideration when choosing where to build. A homeowners; association (HOA) is a group of property owners who form a corporation that makes decisions about the neighborhood. HOAs may establish covenants for the development. Laws governing HOAs differ from state to state, but, generally, if you build in a neighborhood with an HOA, you must pay dues to belong, and you may have to pay additional fees for improving "common" areas, including parks or a community building. In some states, if you do not pay the fees and dues set by the HOA, they can legally foreclose on your home, forcing you out of your house.

Buying an Older Lot

• Occasionally, an empty lot in an older neighborhood will come up for sale, giving you the chance to build in an established neighborhood. Property taxes may be less on older lots because the neighborhood residents have probably paid off the "specials," which are charges for installing streets, power lines, water and sewer. Find out if a home once sat on the lot, and, if so, whether the foundation and debris from the old home were buried on the lot. If this is the case, before you can build on the lot, you must excavate the old debris, which adds substantially to the cost of building your new home.