To sell land to a home builder, the land usually has to be further along than raw acreage. Large builders mostly want entitled land or finished lots, delivered on a schedule that matches their home sales. Most raw land reaches a builder only after a developer has entitled it, platted it and built the streets and utilities. That is why a landowner with unentitled acreage often sells to a developer first.
How large builders actually buy land
Builders do not buy every lot they will build on. D.R. Horton, one of the largest, reported 591,900 owned and controlled lots as of September 30, 2025. About 147,000 of them (25%) were owned. The other 444,900 (75%) were controlled through land and lot purchase contracts. Horton also reported that 65% of its fiscal 2025 home closings were on lots developed by its Forestar subsidiary or by third parties, up from 63% in fiscal 2024.
The pattern is common across the industry. Trade coverage describes builders locking up finished lots with option agreements backed by nonrefundable fees or deposits, instead of buying the ground outright. An option gives the builder the right to buy lots, not the duty to. The builder commits capital only as home sales justify it.
HousingWire reported that builders moved toward "land light" strategies in 2024 and early 2025, and that by 2026 the emphasis has shifted to "land right": control of lot locations, counts and delivery schedules without overcommitting capital. It listed what builders now ask for:
- less capital committed ahead of visible homebuyer demand;
- delivery schedules tied to current sales pace;
- more entitlement certainty;
- flexible deal structure.
The same article quotes Forestar's CEO saying he has not seen much change in land price, so the adjustment is happening in terms and timing. Sellers may be asked to accept phased takedowns, longer closing schedules, or more entitlement and permitting work before closing.
What "takedown schedule" means for a seller
A takedown schedule is a contract term. The builder buys lots in groups, on dates or milestones, instead of all at once. If you are selling finished lots, expect to be paid in pieces over time. If you are selling land to a developer who will sell lots to builders, the developer's cash flow follows the same pattern, and that shapes the price and terms the developer can offer you.
That is a real trade-off. A builder's pace protects the builder from a slow market. The seller carries the timing risk. Read any takedown schedule for three things: what happens to deposits if the builder walks, what happens if the builder falls behind pace, and whether unsold lots stay encumbered.
Why raw land rarely goes straight to a builder
A builder wants to start framing, not run a subdivision approval. In Arizona the work between raw land and a buildable lot is substantial.
Under A.R.S. 32-2101, a subdivision is land divided into six or more lots, parcels or fractional interests, with exceptions such as lots of 36 acres or more. Before a subdivider offers those lots for sale, A.R.S. 32-2181 requires a notice of intention filed with the real estate commissioner. That notice covers legal description and title, access, utilities, use restrictions, and assurances for off-site improvements such as roads and utilities. It also requires water proof. In an Active Management Area that means a certificate of assured water supply or a written service commitment from a designated provider. Outside an AMA it means a report from the Department of Water Resources on whether the supply is adequate. Our guide to assured water supply in Arizona explains what that takes.
Add rezoning, plats, engineering and the horizontal improvements, and you have the work a developer does. The path is laid out in our land entitlement overview. A builder paying for finished lots is paying for that work to be done and for the risk behind it.
The exceptions
Some builders do buy land that is not finished. A ProBuilder piece on controlling land describes builders signing contingent purchase agreements, where the price depends on the landowner obtaining approvals. It also reports that in some hot markets builders buy large "super pads" from master-planned communities without final maps or permits. Both are the builder taking entitlement or timing risk. The article ties this to large parcels in strong locations.
If you own a parcel that is entitled, platted or close to it, in a place where builders are already building, a direct builder sale may be a real option. A builder's diligence will likely focus on the items below.
- A recorded plat or a clear path to one.
- Proof of legal access and utility availability.
- A water source that meets state rules.
- A title commitment and survey with no surprises.
Our checklist for raw land due diligence in Arizona covers the same items from the buyer's side.
What a builder is actually buying
A builder buying finished lots is buying certainty. In Arizona, the notice of intention that a subdivider files under A.R.S. 32-2181 shows what that certainty has to cover. It asks for the legal description, the condition of title and all encumbrances, access, utilities, schools, permitted uses and use restrictions. It requires a description of off-site improvements such as roads and utilities, along with assurances they will be delivered, and a schedule and cost for on-site improvements. It also asks for disclosure of livestock and open-range status and of proximity to military or public airports.
Each item is a place where a deal can slip. A lot with a missing easement, no water source or an unfinished road is not a finished lot, and a builder will not close on it the way it closes on one that is ready for a permit. That is the gap a developer is paid to close. It is also why a landowner who can document title, access, utilities and water before talking to buyers gives every buyer, including a builder, less reason to discount.
The deposit and takedown terms matter as much as the headline price. Ask any buyer, builder or developer, what it pays at signing, what is refundable, what the minimum pace is, and who carries the cost of improvements that are not finished on time.
Who your buyer really is
For most unentitled Arizona acreage, the first buyer is a land developer or an entitlement-focused buyer, not the builder. That buyer prices the parcel on what it will take to get lots delivered. The more of that work the buyer has to do, the more it shows in the offer, and the more the buyer will need to see about the land's limits. Be ready to talk about access, water, zoning and soils before you talk price.
Selling to a builder, a developer or an entitlement buyer are different deals with different timelines. Match the buyer to the state of your land. Rules and market terms change, so verify current requirements with the county planning office or an Arizona attorney.
Selling land that needs this work
Red Dirt Property buys and entitles land across all 15 Arizona counties. It underwrites parcels against its own statewide parcel data and buys as-is, then handles entitlement after closing, with no agent commission on its purchases. If you own acreage that is not yet ready for a builder, start at selling land to a developer.