Whether you live in a rural area with lots of land around your own parcel, or an urban center where a lot abutting yours happens to be vacant, the appearance of a "For Sale" sign in front of that land might intrigue you. Is this an opportunity to enhance the value and appeal of your property by expanding your acreage? Let's look further into the practical and financial considerations of buying a vacant lot, including:
Financial considerations aside, having undeveloped open space next to your home is likely to enhance the aesthetic appeal and value of your own property (assuming the lot is not a toxin-filled mine pit or old dump).
At the same time, you're buying protection against anything that another buyer of that land might later do with it, like building a 20-story monstrosity or starting a pig farm. The benefit of forestalling such development is hard to quantify, but can be high.
If you are living in an area where real estate prices have been increasing steadily and reliably, your purchase of the abutting property could be a sound investment, which will increase in value over the years. Moreover, you might be able to purchase at a price lower than the property's market value. Unlike buying a home, you won't have to deal with tenants or upkeep of a structure.
Check online with your town's assessor department or visit town hall to get the name, address, and telephone number of the owner of the land. Check with real estate information providers like Zillow and with area real estate brokers (not the listing broker, if any!) to get a sense of the property's true market value.
Then you might want to contact the owner personally to ask about the listing price. You might ask and whether, as a neighbor, the owner would agree to grant a discount. (You can call the real estate broker listed on the sign, who will get a commission one way or the other per their agreement, but a personal approach can yield better results.)
If the owner will sell to you at a price substantially less than what you've determined is the land's market value, definitely consider buying it.
Would acquiring the abutting property increase the development value of your own property? For example, your property might have enough land for an additional building lot, but not enough road frontage to meet the legal requirements for an additional lot. In that case, does the abutting property have enough road frontage so that some of it could be added to your property without reducing the road frontage of the abutting property to less than the minimum required to make it a buildable lot?
You wouldn't need to create and sell that additional building lot immediately. It's an investment for the future, perhaps when you decide to downsize and buy a new home.
Creating a new building lot can entail surveying and engineering costs. Get an estimate from a local surveyor or civil engineer; these costs should be substantially less than the value of an additional building lot.
Or perhaps your own home has enough land, or enough road frontage, that by acquiring the abutting land you could create two additional building lots without reducing the acreage or road frontage of your own home below the minimums required in your zoning district.
This would be like buying two building lots for the price of one. As above, talk to a local surveyor or civil engineer about the additional costs involved.