If you've ever thought about buying affordable property and investing in future value, you may want to explore how to buy land bank property. Land banks offer a unique opportunity for investors, first-time buyers, or even nonprofits to buy low-cost land that can be transformed into something valuable.
Unlike traditional real estate transactions, buying from land banks involves a different process, which can often be simpler and more affordable. In this guide, we'll break down everything you need to know—from what land banks are, how to find them, and the steps to purchase land from one. Whether you're looking to flip land, build a home, or start a community project, understanding land banks can open new doors.
What Is a Land Bank?
A land bank is a government or nonprofit agency that takes control of vacant, abandoned, or tax-delinquent properties. These properties are often considered a burden by local governments because they decrease neighborhood property values and attract blight.
Land banks step in to acquire these lots, clean up the titles, and resell them to buyers who plan to improve the land. Their goal is to help redevelop neighborhoods and return properties to productive use.
Why Consider Buying Land from a Land Bank?
Buying land from land banks comes with several advantages:
Lower Prices: Land bank properties are often priced below market value.
Fewer Bidding Wars: Unlike traditional real estate markets, land banks don’t always operate on an open bidding system.
Community Impact: Purchasing and developing these lands can contribute positively to local communities.
If you’re an investor, buying from a land bank can be a smart way to build long-term wealth. If you're a homeowner or nonprofit, it's an opportunity to own property at a fraction of the cost.
Step 1: Research Local Land Banks
Your first step is to identify where land banks operate. Not all areas have a land bank, but many major cities and counties across the U.S. do. You can usually find this information by searching your county’s housing or development authority website.
Well-known examples include:
Detroit Land Bank Authority (Michigan)
Cuyahoga Land Bank (Ohio)
Cook County Land Bank Authority (Illinois)
Visit the official land bank websites to explore available properties, pricing, and application requirements.
Step 2: Understand the Purchase Requirements
Each land bank has its own rules for who can purchase land and how it can be used. Some may prioritize buyers who:
Plan to live on the property
Propose new construction or renovation
Represent nonprofits or community organizations
Are in good financial standing
Before applying, read the eligibility criteria carefully. Some land banks may also restrict the resale of properties within a certain period.
Step 3: Browse Available Properties
Most land banks have an online portal listing properties available for purchase. These listings often include:
Property photos
Parcel size and location
Zoning information
Asking price
Required redevelopment plans
Some land may come with structures needing demolition, while others may be empty lots ready for new use. Always do your due diligence by checking zoning laws, utilities access, and nearby developments.
Step 4: Submit Your Application or Offer
Once you find a suitable property, the next step is to submit an application or purchase offer. This may include:
Personal or business information
A plan detailing how you intend to use the land
Financial documentation
Proof of ability to maintain and develop the property
Land banks review applications based not just on the offer price, but also on the proposed use and potential community benefit.
Step 5: Wait for Approval and Complete the Sale
After submitting your offer, there’s usually a review period. If your application is approved, you'll be contacted by the land bank to finalize the sale. You may need to sign a development agreement, especially if the land requires improvement within a set time frame.
Make sure you:
Read all contracts thoroughly
Understand the development obligations
Follow through on promised improvements
Failure to meet the conditions could result in the land reverting to the land bank.
Tips for Success When Buying Land from Land Banks
Here are some practical tips to make your experience easier and more rewarding:
1. Work with a Real Estate Attorney
Some land bank properties have complicated histories. An attorney can help with title reviews, contract language, and local regulations.
2. Have a Clear Development Plan
Most land banks will expect you to have a vision for the property. The more detailed your plan, the better your chances of approval.
3. Budget for Improvements
While the purchase price may be low, costs like clearing land, installing utilities, or building can add up. Factor this into your total investment.
4. Be Patient
Buying from a land bank can take longer than a standard real estate transaction. Stay in communication and be prepared for delays.
Common Uses for Land Bank Properties
So, what can you do after you buy land from land banks? Depending on the zoning and property type, options include:
Building a residential home
Starting a small business
Creating community gardens
Expanding a neighboring lot
Starting a nonprofit housing project
Be sure to verify all zoning laws and local restrictions before beginning development.
Can Anyone Buy Land from a Land Bank?
In most cases, yes—but with conditions. Some land banks limit purchases to residents, nonprofits, or buyers who are not behind on property taxes. They want to avoid speculators and ensure the land is being used to benefit the community.
If you're looking to buy land from land bank programs, make sure you’re serious about redevelopment. Land banks often check that applicants have the financial means and intention to follow through.
Final Thoughts: Is It Worth Buying Land from a Land Bank?
Absolutely—if you know what you're doing. Learning how to buy land from land banks can unlock real opportunities, especially for those looking to invest in underutilized neighborhoods.
From affordable prices to the chance to improve local communities, land bank properties present a unique value. But it’s not for everyone. Success requires planning, patience, and a commitment to your development goals.
Take the Next Step with Open Field Properties
Ready to explore the potential of land banking? At Open Field Properties, we help buyers discover, evaluate, and act on opportunities to purchase low-cost land with high potential. Whether you’re a first-time buyer or a seasoned investor, our team is here to guide you through the process from start to finish.
Visit OpenFieldProperties.com and find your next property today. Let’s build something great—together.
