Raw land

Raw land is property with no house or building on it. It may cost less to keep up than a building (no tenants, few repairs), but taxes, loan interest, weed and fire rules, access and security still cost money. And it usually earns nothing until it is built on, farmed, leased or sold. Its value depends on access, water, utilities, zoning and growth nearby.

Many cheap lots, including lots sold at county tax sales, are cheap for a reason: no legal road access, no water or power, steep or flood-prone ground, or rules that prevent building. In Arizona, a 1980 law requires subdivisions of six or more lots inside the state’s groundwater Active Management Areas (such as the Phoenix area) to prove a 100-year water supply. In Arizona, outside those areas, lots can usually be sold even when the water supply is inadequate, as long as that is disclosed (unless the county or town has adopted Arizona’s mandatory water-adequacy rule*), and lot splits of five or fewer avoided the rule. Arizona passed an ‘Ag-to-Urban’ law in 2025 that lets some builders in the Phoenix and Pinal areas use water credits from retired farmland. In Arizona, homes in Rio Verde Foothills lost their hauled water supply from Scottsdale in 2023.

Land can pay off well for patient owners when a town grows toward it, but that can take decades. Land also attracts scams: the FBI warns of impostors who pose as the owners of vacant land and sell it to buyers who never meet them. For decades, promoters also sold desert lots in California City sight unseen, with promises of future growth.

Who it suits

Who it doesn’t

Real stories

A 1998 land bet that landed Tesla 16 years later (2014)

In 1998, while Reno’s casino economy was struggling, developer Lance Gilman and a partner bought a parcel east of town larger than the city of Las Vegas, planning an industrial park. They paid for roads, water and power and worked with county leaders. Sixteen years later, Tesla chose the park for its battery factory. By then Gilman’s park had more than 165 companies.

Lesson: Land can pay off hugely, but this took deep pockets, roads, water and power, and 16 years. It is a rare outcome: most land bets don’t end with a famous tenant. Las Vegas Sun: The rise of Reno: Northern Nevada is booming; what can we learn? (Sept. 28, 2014)

Farm worth five times its price after 30 years (2025)

A diversified farmer had bought a 250-acre farm 30 years earlier. He received a $10 million offer from a data center developer, five times what he had paid, and turned it down. Around the country, landowners near growth areas have received offers above $120,000 per acre.

Lesson: The jump came from a data-center boom nearby, which few owners can count on. Plan as if your land may only keep up with inflation. University of Illinois Farm Policy News: Farmers increasingly rejecting data center bids for land (March 2026)

Land without a water supply (2023)

Cheap land and lot splits that avoided Arizona’s 100-year water rule led to a home-building boom outside Scottsdale. The area had no fixed water supply, so residents relied on haulers filling up in Scottsdale. In January 2023 the city cut off sales to roughly 500 to 700 homes. Families flushed toilets with rainwater, used paper plates and faced much higher water costs.

Lesson: Before buying land in the desert, confirm a legal, lasting water source. A well or hauled water is not a guarantee. New York Times (via Boston Globe): An Arizona suburb’s water is cut off, leading to a worst-case scenario for homeowners (Jan. 16, 2023)

Desert lots sold on promises of a boom (1977)

From the late 1950s on, a developer sold lots in a planned Mojave Desert city to more than 73,000 people. Many were recruited through a sales-training program. The developer promised the area would boom, but the growth never came. The Federal Trade Commission sued. In 1977 the company settled and was ordered to pay what was then the largest consumer refund in FTC history.

Lesson: A seller’s promise of future growth isn’t evidence. Check what is actually built, planned and selling nearby before you decide. LAist: 60 years of deception and land sales in California City: 7 takeaways from my investigative podcast (Sept. 2, 2020)

State says desert land shares were ‘near worthless’ (2019)

A company that kept selling California City land later sold shares in large tracts of desert (‘landbanking’). It paid $2,000 referral rewards. In September 2019, the California Department of Business Oversight sued it for securities fraud and shut it down. The department called the land ‘near worthless real estate.’ A receiver was trying to sell the land to repay investors.

Lesson: Pooled land investments with referral bonuses and big growth promises are a warning sign. Check with your state securities regulator first. LAist: 60 years of deception and land sales in California City: 7 takeaways from my investigative podcast (Sept. 2, 2020)

Paid $70,000 to a fake owner (2024)

A man posed as the Canadian owner of a vacant lot. He hired a local agent, sent fake Ontario driver’s licenses and sold the land for $140,000. The buyer’s first $70,000 payment went through. Then the title company ran into trouble with the second payment and reached the real owners, a Texas couple. They had never agreed to sell. The FBI says vacant land fraud rose 500% in four years.

Lesson: Verify the seller’s identity on your own, especially when they won’t meet in person and the land is vacant. Use a title company and title insurance. ABC11 / ABC News: FBI warns scammers are posing as landowners to sell properties to unsuspecting buyers (Sept. 26, 2024)

Costs

How people pay

Check before you buy

Sources