When it comes to buying land, Georgians are a decidedly cash-oriented bunch. In fact, of the 10 metro areas tracked by Attom, Atlanta is tops for investors buying land in the state. Whether that’s because it offers better investment returns, the lack of mortgages available for rural areas, or the perception that cash purchases have fewer strings attached, the majority of land buyers in the state pay with all-cash.
All-cash buyers often use their own funds, drawing from retirement accounts, repurposed stock profits, or even the proceeds of selling previous homes. They may also buy land as an investment and then flip it to another buyer, or they may plan to build on the property over time. Regardless of why they’re doing it, there are some important things that all-cash buyers need to keep in mind when buying land in Georgia.
A common reason people sell their land is that they no longer need it or want to maintain it. In some cases, this is simply because they moved from the area and no longer have access to their land. In other instances, the land is unsuitable for farming or has too many trespassers.
Other reasons people sell their land in Georgia include a desire to retire and downsize, a change in investment strategy, or a need for cash for other needs. Lastly, some people inherit land and find they are unable or unwilling to deal with its tax obligations and other issues.
In the first half of the 19th century, Georgia used a series of land lotteries to give away public lands for free. These were aimed at boosting the state’s economy and settling land that Georgia had little control over because it was occupied by Native Americans. Despite these efforts, the Georgia land sales for cash ultimately failed. The state was forced to cede land west of the modern border after Andrew Jackson’s victory in the Yazoo land conflict.
The land lottery system in Georgia was significant because it helped to change the state’s power structure, shifting from large planter aristocrats to small yeoman farmers who grew their own crops and hired enslaved labor. However, there were still concerns about fraud and corruption in the sale process.
Buying and selling land for cash is a great way to save money on real estate transactions. However, buyers should be aware of some additional costs associated with all-cash purchases. The first is an intangibles tax, which varies by state but can be as high as $1.50 per $500 in loaned funds. The next is the prorata share of ad valorem taxes, which are property taxes that are paid based on the amount of time each owner has owned the land. These costs can add up quickly. Buyers should also consider the cost of any improvements they plan to make on their new land. For example, if a buyer is planning to build a cabin or pond on their property, the cost of materials could easily exceed $10,000.
