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Buying land in Texas and building a house on it takes more than browsing listings and writing a check. The land you pick controls what you can build, how long the build takes, what it costs, and whether closing day delivers a clean title or a problem. The 9 steps below are the order we walk Texas homebuyers through, drawn from over two decades of building custom homes across the Houston metro.
Three things matter most. Verify mineral rights before you sign anything. Confirm the property is not in a floodway. Get a real survey, in addition to the title commitment.
Land prices vary by region more than almost any other state. Here are the most current numbers from the Texas Real Estate Research Center at Texas A&M, using Q4 2025 data.
For Houston-area buyers shopping outside the city, the cheaper end is Piney Woods South. The American Society of Farm Managers and Rural Appraisers prices improved and native pasture there at $2,500 to $5,000 per acre, with bottomland hardwood timber at $1,500 to $2,100. Inside the metro, build-ready residential lots run far higher per acre once they have been platted and serviced.
Two things to keep in mind on price. The acre price is not the cost to build there. Site preparation, utilities, septic, well, and any flood-mitigation work can add tens of thousands before you pour a foundation.
And prices climbed every quarter of 2025. The window of sub-$5,000 statewide median pricing closed at the end of 2024.
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Each step matters. Skipping one is how a beautiful listing photo turns into an unbuildable problem six months in.
Most first-time buyers treat the land cost as the budget. The land is the smaller half.
A buildable lot in the Houston metro at $11,500 per acre on five acres is $57,500 for the dirt. The custom home that goes on it, in our pricing range of $150 to $300 per square foot, runs $450,000 to $900,000 on a 3,000 square foot home.
Then come the costs in between. Site clearing. Driveway. Septic system if you are outside city sewer. Well drilling, if you are outside city water. Electric line extension from the road, which can run thousands per foot for a long driveway. Permits and impact fees. Soil testing and engineered foundation design, which is non-negotiable on Greater Houston's expansive clay soils.
Run real numbers before you start shopping. Our cost to build a house calculator gives you a working estimate for the build itself. Add 10 to 20 percent contingency on top.
A practical rule we use with first-time buyers in Greater Houston: keep total monthly housing payment, land plus home, under 25 percent of take-home pay. For the wider cost picture, see our full breakdown of what it costs to build a house.
Region drives everything that follows. Property taxes, school district, commute, soil type, water availability, and county permitting. Buyers in our market typically choose between three patterns.
Suburban acreage in Montgomery or Grimes County. Think High Meadow Estates, Estates of Clear Creek, Canyon Crossing. One to ten acres, deed restrictions are the norm, utilities are usually nearby, and Magnolia ISD or similar districts pull a lot of buyers here. Land runs higher per acre than rural East Texas, but you spend less on infrastructure to make it buildable.
Lake Conroe waterfront. Premium pricing per acre, with the most regulatory complexity in our area. Any build within 2,075 feet of the lake requires a San Jacinto River Authority permit on top of the standard county permit. Plan for an extra two to four weeks in permitting on first-time waterfront builds.
Rural East Texas piney woods. Cheapest dirt by a wide margin. Pasture runs $2,500 to $5,000 per acre. The tradeoff is everything else. Longer commute. Septic and well almost always required. Electric line extensions that can be expensive. Minimal county building codes, often offset by layered deed and mineral restrictions.
If you are coming from out of state, focus on one question. Where can you build the home you want, for the budget you have, and still get to work?
Texas does not have statewide zoning. Counties cannot enforce zoning in unincorporated areas in most cases. That sounds like freedom, and it leads buyers to assume there are no rules. The rules live in different places.
Deed restrictions. Private rules attached to the property by a previous owner or developer, often more restrictive than any city code. Minimum square footage. No mobile homes. Architectural style requirements. Pull the deed and read every restriction before you make an offer.
HOA covenants. If the property is in a subdivision, the HOA's CCRs bind you. These are public records. Get them.
City extraterritorial jurisdiction (ETJ). Within a city's ETJ, the city can enforce subdivision rules and platting requirements even though you are unincorporated. Houston's ETJ extends well beyond the city limits, into Montgomery and Fort Bend counties.
County rules that do apply. Floodplain regulations, septic permitting, road access standards, and the Montgomery County permit office requirements for new construction.
For the Houston metro, the four counties to know are Harris, Fort Bend, Montgomery, and Brazoria. Each has its own permitting office, its own floodplain manager, and its own quirks.
This step catches more first-time buyers in our area than any other. Texas water rights work differently than what most buyers expect.
Surface water (rivers, creeks, lakes) belongs to the state. Pumping from the creek on your land for anything beyond limited domestic use requires a permit.
Groundwater belongs to the landowner under the rule of capture. You own the water under your dirt and can pump it. The rule has been modified by Groundwater Conservation Districts (GCDs), which now cover most of the state and can require permits, regulate well spacing, and limit production.
For our buyers, the relevant district is the Lone Star Groundwater Conservation District, which covers Montgomery County. They have rules on well spacing and production for non-exempt wells. Check whether your tract is inside the district before you assume you can drill freely.
What to verify before you sign:
The well cost variance alone can shift your budget by $20,000 or more. Drilling depth in Greater Houston ranges widely, and a dry hole is not free.
The FEMA map is a starting point, not a verdict. We have walked Montgomery County buyers through lots that looked clean on the map but flooded every heavy rain because of upstream development.
For the deeper version of this conversation, see our notes on well and septic considerations and floodplain and drainage evaluation.
Texas land law surprises most out-of-state buyers here. The mineral estate (everything below the surface that has commercial value: oil, gas, sulfur, metals) can be owned separately from the surface estate. If it has been severed, Texas law treats the mineral estate as dominant. The mineral owner can use as much of your surface as is reasonably necessary to extract their minerals.
A real example of how this plays out. A buyer purchases a residential acre. Six months after closing, an oil company shows up claiming the right to drill, because the mineral rights were severed in 1952 and the standard title work did not catch the detail. That buyer now has a drill rig, an access road, and pipelines on land they thought they owned outright.
Standard residential title companies often miss this. Mineral severances can go back decades and may not appear cleanly in routine title work.
Before closing, do these four things:
Mineral rights are not always a problem. In many Houston-area suburban subdivisions, the developer reserved minerals decades ago, no one has ever leased or drilled, and the practical risk is low. The point is to find out, in writing, before you sign.
A title commitment tells you what the title company found in the public record. It does not tell you where the property lines run on the ground. For that, you need a current survey. Bank-required surveys are usually a "category 1A" boundary survey by a Registered Professional Land Surveyor.
What the survey tells you that the title commitment doesn't:
The title commitment tells you about recorded easements, liens, restrictive covenants, and exceptions to coverage. Read every page. Schedule B is where the exceptions live, and where surprises hide.
Both are buyer expenses, both are non-negotiable for any custom home build, and both cost less than discovering the problem after you have poured a slab in the wrong spot.
Land loans are not regular mortgages. The loan you need depends on the type of land you are buying.
Raw land loans finance undeveloped property with no utilities, no road access, no improvements. Hardest to get. Largest down payments, often 30 to 50 percent. Highest rates. Mainstream banks usually decline.
Unimproved land loans finance property with some utilities or road access but no buildings. Easier than raw land, still harder than a mortgage. Down payment 20 to 30 percent.
Improved land loans finance lots with utilities, road access, and infrastructure already in place. Most accessible. Down payment closer to 15 to 20 percent.
For a custom home build on owned land, the cleanest path is often a one-time close construction-to-perm loan. This combines the land purchase, the construction loan, and the final mortgage into a single closing. Most of our buyers use this structure because it eliminates a second closing and a second set of costs. We cover the full mechanics in our one-time close construction loan guide for Texas homebuyers.
For larger rural tracts (10 acres and up), the Farm Credit System is usually the right fit. Texas Farm Credit, Capital Farm Credit, and Heritage Land Bank specialize in rural land and understand ag exemptions, surface waivers, and the rural-loan paperwork that confuses commercial banks. They typically finance properties from 5 to 100 acres with 15 to 20 percent down.
For veterans, the Texas Veterans Land Board offers land loans up to $150,000 with 5 percent down through participating lenders.
Get pre-approved before you write an offer. The Texas land market still moves fast on well-priced tracts, and "we are talking to a lender" is not a strong position against a pre-approved buyer.
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When you make an offer on Texas land, three things matter beyond the price.
Earnest money. Typically 1 to 10 percent of the purchase price, held by the title company. Larger earnest money signals you are serious.
Contingencies. Four to put in writing on raw land:
The option period. Texas contracts allow the buyer to pay a small fee for an unrestricted right to terminate for a defined number of days, typically 7 to 14. Use it. Order the survey, pull the well report, get the mineral title opinion done.
Closing happens at the title company. You sign the deed, the closing disclosure, the loan documents (if financing), the title insurance policy, and the rest of the stack. Closing costs on Texas land typically run 2 to 5 percent of purchase price.
Once the documents are recorded, the land is yours.
If the property qualifies, file your agricultural valuation application with the county appraisal district. An ag valuation taxes the land based on its agricultural productivity rather than market value, which can drop the property tax bill by an order of magnitude. There are minimum acreage and use requirements, and the deadlines are calendar-strict. Talk to the appraisal district before you assume you qualify.
The land transfer is the start of the work, not the end.
What needs to happen between closing and groundbreaking:
The full preconstruction sequence we walk our buyers through is detailed on our permitting and preconstruction page.
Harris County. No countywide zoning. The Engineer's office handles floodplain permits and platting. Houston's ETJ covers most of the unincorporated county. Verify whether your parcel is inside the city of Houston, inside its ETJ, or fully outside.
Fort Bend County. Active floodplain management. Levee improvement districts (LIDs) and municipal utility districts (MUDs) are common, and each has its own assessment. Pull the LID/MUD assessments before you sign.
Montgomery County. Our home county. Permits flow through the Montgomery County permit office. Office hours shrank in February 2026 (now 3:00 PM closing), which tightens windows for same-day fixes. Lake Conroe builds layer SJRA permitting on top of county requirements.
Brazoria County. Coastal floodplain rules apply across much of the south county. Wind zones drive insurance and engineering requirements differently than counties farther inland. The Coastal Erosion Planning and Response Act (CEPRA) affects building near the Gulf shoreline.
For our buyers across Conroe, Magnolia, The Woodlands, and Montgomery, the practical advice is the same. Bring the builder in before you close on the land, not after.
Most Texas land loans require 15 to 20 percent down on improved land, 20 to 30 percent on unimproved, and up to 50 percent on raw land with no utilities. Texas Farm Credit, Capital Farm Credit, and Rural 1st typically work in the 15 to 20 percent range for tracts of 5 to 100 acres. Veterans can use the Texas Veterans Land Board program, which allows down payments as low as 5 percent on loans up to $150,000.
A typical land purchase from offer to closing takes 30 to 60 days. Cash deals close faster. Financed deals on raw land take longer. The option period (7 to 14 days) runs at the front of that window for due diligence. Add 2 to 8 weeks before the offer for a serious search, and another 60 to 120 days after closing for permitting and preconstruction before groundbreaking on a custom build.
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Buying land first gives you control over location and lot. The tradeoff is more upfront work: financing, due diligence, water and mineral verification, permitting. Buying a builder's lot or building in a master-planned community removes most of that work but limits your choices. For our build-on-your-lot buyers in Montgomery and Grimes Counties, the lot-first path almost always wins on long-term satisfaction. For buyers who want to be in a specific subdivision and don't care about acreage, the builder-lot path is faster.
It depends on region and finish level. In the Houston metro, land alone runs from $2,500 per acre in rural East Texas pasture up to $11,500-plus per acre per the latest Texas A&M data. The custom home itself runs $150 to $300 per square foot in our pricing range. A 3,000 square foot custom home on five suburban acres in Montgomery County typically lands in the $500,000 to $1 million range all-in, before site work. Use our cost to build a house calculator for your specific numbers.
Not legally, but a first-time buyer almost always benefits from one. A buyer's agent who specializes in land (rather than residential resale) catches issues a residential agent misses: ag exemptions, surface waivers, well disclosures, septic permits. The seller's agent is paid by the seller, so their job is the seller's interest.
Texas groundwater belongs to the landowner. You can pump as much water from a well on your land as you want, with limited exceptions: you cannot pump maliciously to harm a neighbor, you cannot waste water willfully, and you cannot drill a slant well into someone else's property. Groundwater Conservation Districts now cover most of Texas and can require permits, regulate well spacing, and limit production. The Lone Star GCD covers Montgomery County. Check whether your parcel is inside a GCD before you assume you can drill freely.
An agricultural valuation taxes land based on agricultural productivity rather than market value, which can drop the property tax bill by an order of magnitude. To qualify, the land must be used primarily for agriculture (livestock, crops, hay, timber, or wildlife management) and must meet minimum acreage and historical-use requirements set by the county appraisal district. If the land already has an ag valuation, ask whether it transfers cleanly. If you change the use after closing, you may trigger a "rollback tax" covering the prior five years of saved taxes.
Buying land in Texas does not have to feel overwhelming. Verify before you sign. Bring the builder in early. Plan for the costs that aren't on the listing.
Dunn & Stone has been building homes on owned land since 1999, across Montgomery County, Grimes County, Lake Conroe, and the wider North Houston area. We are members of the Greater Houston Builders Association and the National Association of Home Builders, and we are BBB Accredited. You can browse our completed builds to see the floor plans and finishes our buyers have chosen, on lots from suburban acreage to lakefront.
If you want a candid conversation about a specific property or a build you are planning, schedule a free consultation with our team. Bring your questions about the lot, and we will tell you what we would flag if it were our build.
Fred Loucks has worked in custom home building since 2010 and leads Dunn & Stone Builders as CEO. The company has been building homes on customer-owned land across Montgomery County, Lake Conroe, and the wider North Houston area since 1999. We are members of the Greater Houston Builders Association and the National Association of Home Builders, and we are BBB Accredited.
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