Many businesses find that renting land for their operations is much better than purchasing it outright. Still, there are several steps you must take before committing to a rental agreement to ensure that the decision helps your business instead of hurting it.
There are 5 essential steps to take before renting a plot of land. First, be clear about your purpose. Then, plan your finances carefully, accounting for unexpected costs along the way. Next, explore your desired location thoroughly and ensure it has the infrastructure your business needs. Lastly, ensure you comply with local rules and regulations while checking the rental agreement before signing it.
Don’t worry if any of this seems unclear or overwhelming. This guide will dive deeper into the 5 steps you must take. You’ll also discover the risks that come from skipping these steps.
Let’s get started!
5 Things You Must Do Before Renting Land
Here are the 5 essential steps you must take before you commit to a land rental agreement:
Step 1: Be Clear About Your Purpose
First and foremost, you must be clear and honest with yourself about your purpose. In other words, you must have a clear sense of why you want to rent land in the first place.
For example, do you need an ample and open space with good accessibility? You may need a location further away from residences to minimise complaints about dust and noise.
Whatever it is, be clear about it from the get-go.
Remember: renting the right plot of land can make or break your success. So, don’t deviate from your original purpose with a less suitable option just because it’s cheaper or easier to get.
Instead, stay true to your requirements and preferences.
You’ll be glad you did!
Step 2: Plan Your Finances
The second step you must take before renting land is to plan your finances carefully. Understanding your budget and its limitations will ensure you stay within your budget financially when securing your dream plot.
Besides, many land renters need to pay more attention to the additional costs of securing a plot.
For example, the cost of permits, insurance, and land works could be necessary before you can operate on that land. Those costs will also differ depending on your business type and the operation you plan to run.
On top of that, it’s also an excellent idea to set aside some money in an emergency fund. Having that as a buffer will help you cope with any other financial hurdles that might occur along the way.
Don’t be afraid to take as much time as you need to complete this step. It’ll ensure you don’t run out of funds prematurely.
Step 3: Thoroughly Explore The Location
Once equipped with a clear purpose and budget, it’s time to shop around. You can find land in several ways, like through your personal networks, in newspaper classifieds, or online through websites like Tanahsewa.com.
As you narrow down your options, you must take the time to explore each location thoroughly.
Some places look more attractive on paper than in reality. That’s why you should visit the location first-hand and ensure it can fulfil your needs.
For instance, you’ll want to check for the plot’s natural surroundings and nearby communities. Besides that, it’s also crucial to ensure the land is accessible so your inputs can be delivered and outputs can make their way out easily.
Lastly, it’s worth ensuring that the land is close enough to essential services like healthcare facilities and police and fire stations.
Step 4: Consider Infrastructural Needs
Your dream plot of land might have all the qualities you’re looking for but don’t forget about the basics: the infrastructure.
Infrastructure quality can help or hurt your operations, regardless of whether you’re in agriculture, manufacturing, or any other business.
Some of the basic infrastructure your land must have access to include:
Electricity: Unless your operation can function off the grid, you’ll need access to electricity. That’s especially true if your business relies heavily on tech and cannot afford electrical downtime.
Water: Water is another critical infrastructure your land must have access to. That’s necessary for cleaning, irrigation, hydration, and more.
Access roads: Roads are essential for worker accessibility, incoming supplies, and outgoing products. The quality of those roads also matters if you’re dealing with heavy machinery to ensure efficient operation, minimised wear, and safe operation.
Waste management: Wherever there’s work going on, there’s bound to be waste. So, your rented land must have space and ways for your operations to handle waste effectively.
Remember that finding a plot of land with access to basic infrastructure will reduce costs and make things run smoothly. That’s because you won’t have to invest in preparing that infrastructure from scratch.
Step 5: Check Rules, Regulations, And Legal Agreements
Suppose you’ve completed the first four steps above and are ready to proceed with your chosen plot. The final step you must do before committing to anything is to do your due diligence regarding the rules, regulations, and legal agreements.
After all, you don’t want to set up shop on the land only to discover that your operation can’t begin for whatever reason.
You can do the legwork yourself or consult a lawyer to comply with local rules and regulations. The same is true when looking into the rental agreement you will sign with the landowner.
Checking all these things will give you complete peace of mind as you rent the land!
What Are The Risks Of Not Performing Due Diligence?
Some renters might overlook the steps described above in their rush to secure land. Doing so raises several risks that include:
Compliance issues: For starters, you and your business could face compliance issues with local rules, regulations, and laws. That could hinder your agricultural or commercial operations.
Unexpected costs: Additional costs you did not budget for could also hurt you financially. These costs could have been identified if enough research had been done.
Community relations problems: Aside from getting on the wrong side of regulators, your lack of research could also cause friction with the surrounding community.
Operational hiccups: Failing to perform due diligence could prevent your operations from running smoothly. That’s especially true if there is a lack or absence of the necessary infrastructure nearby.
Needless to say, you’ll save yourself money and energy while preventing headaches by devoting time towards due diligence.
Find Your Ideal Plot Of Land Now!
At this point, you’ve discovered the 5 essential steps you must take before renting your piece of land. Following these steps will reduce the odds of running into problems, giving you a smoother process from start to finish.
Now, the only thing left to do is find the ideal plot of land to suit your needs and preferences. Browse the listed plots on Tanahsewa.com, your one-stop hub for agriculture, commercial, and personal land!
Ray Hasbollah
Content Strategist
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