Conditional purchase???....lots of things to weight out.

[Thoughts-from-Jules]

Well I assumed it would be expensive but the price range was huge!  First of all they quoted me for the "residential service" and I asked what they classified as residential.....she said well if you were to build your house first and get power.  So that figure was $44,000 for 1.2 mile of above ground lines!!!!!  Then she said that the "non-residential" service would be $13,500 for the same stretch.  I asked her to clarify....she said well some people just build a shop first and stay in an RV or something while they build (what we were planning to do) and she said since it is servicing a shop it isn't residential.  So basically if we build our shop first it saves us $20,000 in power installation costs and pays for the shop structure!  Shesh!!!  Good thing we were planning to build the shop first.   So that is the first hurdle crossed, the power situation.  We can get it and we might be able to afford it too. lol  Next hurdle is well costs.

Currently we are the confusing stage of needing to apply for a conditional use permit to build. It is on big game grazing zone and we'd have to apply for conditional use and go before the planning commission.  We have some incentives to hopefully help it get approved.... by possibly agreeing to improve 1 mile of current road (add more pit run to raise the road bed and keep it from drifting as bad, as well as a good layer of crushed gravel) my DH works for my family's construction business and this would all be close to free for us.     As well as the site work, foundation, and septic being an extreme value with materials cost only (minus gravel and rock which would be free most likely).  So that might help sweeten the pot for them to approve it.


So has anyone ever done a conditional purchase.  Since the current has to go before the commission to get conditional use we'd have to buy the property not knowing if we could build. UGH.  We thought of maybe doing a conditional sale, go ahead and buy it but put in there a contigencie that if the land is not buildable after we go thru the application process for a fwelling the original owner would buy it back minus some fee for the hassle.  Does that seem reasonable?

[MountainDon]

We bought our land with several stipulated conditions. The conditions had to be met before any cash changed hands. That took a year which was a drag but also alright. A drag because it delayed building and a blessing because the land prices went up but ours price was locked in and the money sat in the bank and made some interest.

So, I'd try to get the seller to go for a sale conditional upon receiving the permit to build. I don't know if that can be done?  In our case the conditions all had to do with issues the seller had to settle and agree to. There was no third party involvement. I certainly would not want to complete the sale and transfer without knowing that I could build on it.

That's interesting on the power company hookup. And very puzzling.    The power company can't come and charge you more money once the house is built, can they? That wouldn't make sense, but neither does the cost difference between a "residence" and a shed or barn.

[Redoverfarm]

I am like you Don.  The power company works with Construction cost associated with the length of the run.  Number of poles, amount of wire, right-of-way clearing and man hours to construct.  It shouldn't make any difference what is at the other end.   

[MountainDon]

Yep. In our case there were no poles.    Service had to be underground to the property line. Then they recommended we have our part underground as well. $55K to the property; less than a mile. They would have included a transformer box on the ground just inside the property line.

[NM_Shooter]

$13500 would go a long way for a nice solar and wind setup, with a backup genny for heavy loads.

[Thoughts-from-Jules]

I don't even know how expensive a solar system is really any ballpark figures for a 1600-1800 sq ft house (we have 4 kids).  DH doesn't want the upkeep of batteries and all that jazz.  At least not if we can help it.  I didn't think $13,500 was too bad for service for that far away on fairly hilly terrain.  I think that was for a 400 amp service.  Now $44,000 seems really steep.  I don't understand either the way they do it.  It is a energy coop in our area.  Maybe I should call back again and make sure I heard her right, even though I made her repeat it to me the first time. lol  I would hope that they can't come back and backcharge us....we have to pay upfront so I don't know it would be possible.  I guess if they tried to do that I'd say no thanks we'll go solar ("you can just unhook that powerline now and guess you don't get my business afterall").  Granted we are out $13,500 but at least we won't have to pay the full $44K.  She said something about their regulations.

Anyway we got the conditional use permit and will be working on filling that out.  I notice on the form it has a place to say land owners name and applicants name so maybe we won't have to worry about a conditional purchase, if we can apply for it without owning it.  It would be March 9th at the soonest before we'd have our answer and that is only if we have it turned in before Feb 4th. 

I guess this is start of the hoops part of the process huh?

[ChuckinVa]

I can chime in on the cost of the service to a shop vs a residence. The power company looks at how long it would take for them to get their investment back in terms of usage. The theory being that a "shop" would use more KW's than a residence would. They would start making $ faster under those conditions and so with the residential service it would take longer to start making $ so they supplement their cost ( expense) by charging you more of the initial cost to build the line. In Virginia sometimes owners will build the line ( Underground) because it is less expensive to do it their selves.( (This would be on your property only) I have never heard of anyone building one as long as a mile though. Good luck with your purchase. I hope everything works out for you.

CHUCK

[Thoughts-from-Jules]

Thanks for that insight!  I guess it makes a little sense.  Do they have a problem with later hooking up the residence as well (or can/will they come back and charge us?).  It will likely be a year or more from the time we get power and shop built to when the house would be ready for power. 

We are trying to figure out what all to go after when we apply for the conditional use..... try for a temp dwelling while we build in the form or a used single wide or just keep our place in town until the house up there is finished.  Which limits our borrowing capabilities and savings capabilities too.  It would be nice to be onsite at least 9 months of the year that first year to build but not sure it is worth the hassle of rushing to get septic and everything in.  I think we'd rather pace ourselves and drive back and forth. Maybe a little distance from the project between building sessions can give us some perspective and time to think on the best way to build it etc.  Who knows.  It might take a year to build the shop. lol

How long from land purchase do most projects start the building process.  I was thinking in our case 2 years we might have the shop completed, utilities in, land improvements done, like fencing 20 acres, the house dried in and just the inside to finish.  Does that sound reasonable?  We have a family that enjoys some good old fashioned barn raising now and then so I imagine we will have a few work parties for the more labor intensive portions.  We feed them and they will come. lol

Thanks for all the replies!

[ChuckinVa]

"Do they have a problem with later hooking up the residence as well (or can/will they come back and charge us?).  It will likely be a year or more from the time we get power and shop built to when the house would be ready for power. "

I would want to get it in writing from the power company what they would do if you add a residence later. I would not expect that they would, as the line would be where you needed it at that time and it would only be a short drop to the house, but someone once told me "a sharp pencil is better than a short memory" get it in writing . 

PS  Another possibility is to build your service in the shop so that you could feed the house from the shop. Perhaps underground from the shop to the house. Then it would simply be a sub panel in the house and effectively one service / meter.

[glenn kangiser]

That is what I would do - then write the whole thing off as expense too even if you need to start a business making widgets.

[miman]

i got lucky with my power company. 200 ft. 3 poles and one transformer...free. the prices some are you paying for power..well..septic is more than my lot and cabin.   

[MushCreek]

You might want to check how much 'commercial' service is going to run you on a monthly basis. My mother had two different powerlines coming in when she bought her place- one to the house, and one to the barn. She started to get astronomical bills for the barn, which she rarely used. It turns out the minimum (in her area, at least) was quite high for commercial service. What's funny is that they down-graded it to residential for no cost, and then she paid the residential rate! They didn't change any of the equipment; they just started calling it 'residential'.