What Is the Cost of Buying Land in Austin, TX?

If you've been considering buying a parcel of land, you've likely also been wondering what the cost of buying land in Austin is. Like any question, the answer depends on several variables. Here, we'll discuss the average cost of an acre in Austin, the factors that impact the cost of land, and how partnering up with a guide can help you make the right choice. 

The Average Cost of an Acre 

What's the average cost of an acre in Austin? Because land is sold in such diverse parcels, like urban infill, estate lots, and raw tracts, the average price per acre is difficult to pin down and can be misleading. As you might imagine, there are a few answers to this question. 

Typically, in exclusive areas like Westlake Hills, you can expect $1.5M to $2M per acre. In emerging areas like South Austin or far West Austin, land might average $500K to $800K per acre. Waterfront land skews the average, with Lake Austin lots often starting at $3M+ for just the land. 

What Determines the Price of Land?

Now that we know what land costs in various regions, it's important to know what determines the cost of land in Austin. When examining land prices, several key factors come into play and change the final result. These 5 factors all work together to give you your final price.

1. Location

Location is the single most influential factor. Proximity to downtown, school districts, and sought-after neighborhoods dramatically impacts land value. Areas like Rollingwood, Westlake Hills, Tarrytown, and lots on Lake Austin will be priced higher than others.

Conversely, land is much cheaper on the eastern side of town, although the area isn't as built up. South Austin also has more accessible land purchasing price points, with prices significantly lower but still subject to upward pressure due to demand.

When you're looking at the cost of building a custom home in Austin, be sure to also consider where in the city your home will be located. 

2. Availability

Land availability is becoming increasingly more of an issue, especially in West Austin. Protected hillsides, lakes, and green space preserves make opportunities scarce. Infill lots are extremely popular but also have little room for expansion. These lots in central areas range from $500K to $900K but are extremely popular due to their location and costs.

As you venture further out, land becomes more abundant and often comes in larger parcels, but you're trading proximity for space. The further out from the city you go, the less likely you are to get into a bidding war, but you're also losing the amenities that come with living in or near Austin.

3. Utilities

Lots with existing water, sewer, and electrical services will be higher priced because of reduced development costs and a smoother permitting process. However, many of our clients also purchase undeveloped land in surrounding counties and use septic systems and wells, especially when looking for over one acre.

4. Demand

Supply and demand impact everything, including the price of land. Demand remains high for luxury, custom-buildable land in West, South, and Central Austin. This interest, coupled with a finite supply, is steadily increasing per-acre prices. You're not alone if you start looking for land during the warmer months. If you want to get ahead of the game, start browsing your options in the winter.

5. Zoning Laws

How do zoning laws affect prices? Zoning laws in Austin can either expand or limit a lot’s potential. Areas like Clarksville or Tarrytown have historic overlay zones that add red tape but preserve the neighborhood's character, adding long-term value for the right buyer.

Zoning also determines:

• Height and setback restrictions

• Whether you can build an ADU 

• Permits and requirements

All of these can impact resale and build feasibility, which is yet another reason to hire an experienced guide. You don't want to buy the perfect piece of land only to discover that it's not right for you for reasons that could've been determined beforehand. 

Is Land a Good Investment?

Absolutely, yes. It's a great investment. Land is a finite resource, especially in desirable neighborhoods, but it's also a long-lasting one. Land values in Austin have trended upward for over a decade, with consistent demand from tech transplants, luxury homeowners, and downsizing retirees.

Investing in land provides freedom, financially and economically. It also gives you design freedom. A blank canvas allows you to optimize for:

• Views and sunlight

• Outdoor living space

• Energy efficiency

• Long-term home value

Buying Land with a Trusted Guide

Should you hire a real estate agent to buy land? Without question, yes. You should work with an expert to buy land. 

Most buyers should not navigate the complexities of zoning, utilities, restrictions, and topography alone. At J. Angelo Design Build, we offer a full-service real estate brokerage with a licensed broker. Our team knows Austin well and can help you find the perfect spot, whether you're chasing hilltop views or walkability to top schools. 

Here's what you can expect when you work with us to find and buy land:

• Assistance in finding the best value lots

• Understanding of zoning and historic district rules 

• Guidance through different scenarios

• Evaluating design potential and sun orientation

• Recommendations for lenders familiar with land loans 

Financing Options

Are there financing options available for land purchases? Yes, but they're more nuanced than traditional home loans. Because of our expertise and knowledge in the industry, we're able to work with lenders experienced in land financing with options like:

• Land loans with higher down payments 
• Construction-to-perm loans that bundle the lot and build into one mortgage
• Guidance through appraisal challenges for unique or luxury parcels

Financing undeveloped or raw land often requires more documentation, but with the right partners, it's a great investment and a wise choice. Like anything in life, buying property in Austin requires the right resources and guidance. 

Working with Our Team

When you work with J. Angelo Design Build, we can walk you through every step of the process. We can help you find just the right plot of land, arrange financing, and do any site work needed before you build your custom home.

The goal at J. Angelo Design Build is to come alongside you as a guide and simplify the experience. We use our expertise to make your life easier. Our portfolio shows what happens once we start building or remodeling, but the work starts long before then.

We use a tried and true process to keep you informed every step of the way, and you don't have to bounce from expert to expert to get what you need. Check out our service area to see if we can work with you. Are you thinking about a remodel instead of building a custom home? You can access our cost guide resource and see just what your project will cost. 

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